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this post was submitted on 22 Aug 2024
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There are only really two cryptocurrencies you should care about:
That's it. Which wallet you use is up to you, and there are plenty of easy ones freely available for phones (e.g. I use Monerujo on Android).
Bitcoin is the most widely used coin, and Monero is the most privacy-friendly. You can exchange between them using something like Kraken (perhaps the best place to buy/exchange crypto). Bitcoin transactions are slow (processed every 4 hours, I think?), expensive (like multiple dollars), and publicly traceable (if you have the wallet id, you can see everyone you've transacted with and how much), which is where Lightning comes in, which dramatically reduces transaction time, reduces fees, and improves privacy. Monero is private by default, and the way it handles transactions discourages mining farms, so there's usually a bit less speculation and generally way lower fees (usually <$0.01).
As for why you'd do it, it's because you value your privacy or you do a lot of international transactions (cryptocurrencies don't care what country the two parties are in). If you buy a pre-paid card w/ credit or debit, the banks can track that transaction and potentially figure out what you used the pre-paid card for, and if they work w/ the government, it's trivial to track that down (e.g. if you live in or visit a place like China). With Monero, they can only track interactions w/ fiat (i.e. buying or selling at an exchange), they can't tell where you used those funds or anything of that sort. And that's true even if they collude with the buyer or seller, they can't track Monero wallet details to an individual on either end of the transaction.
Some stores offer a discount for buying w/ Monero (and potentially other coins), such as the YouTuber "Mental Outlaw," who hosts based.win and offers a 10% discount for buying in Monero.
That said, there aren't a ton of place that accept cryptocurrency, which is a bummer. But the more people start to use it for even small things, the more likely stores are to accept it. That's my dog in this race, I want to use Monero where it's available so the few stores that accept it continue to, and hopefully they'll find enough value in it to get other stores on board. I don't hate fiat or anything, I just hate how much tracking there is with other digital payment systems.
What is needed before crypto can actually be useful:
There’s more, but I won’t bother as the above issues are more than enough to confirm that crypto is a scam.
If you think of cryptocurrencies as the same as cash, just digital, with all the same protections as physical currency (i.e. physical possession), then it makes a lot more sense. You shouldn't be putting your life savings into any cryptocurrency IMO, you should be only using it for spending, like a checking account. Keep your savings somewhere else. In my mind, cryptocurrencies are ready today to replace a checking account for some transactions, but it's not ready to be your primary checking account, nor is it ready to be used as savings.
Saying crypto is pretty much the same as cash is disingenuous.
You don’t need to make an account to spend cash. You don’t need to pay fees to give cash to someone else. You don’t need to pay fees to process cash transactions. You don’t need an internet connection to acquire or spend cash. Cash transactions are executed in person, where mistakes can be reversed. If my personal info is compromised, my cash on hand is safe. Cash is generally much more stable, and is generally accepted everywhere.
And let’s address a biggie- cash doesn’t destroy the earth, unlike crypto. For all the protest I see about AI’s energy consumption, crypto was worse in 2022 than AI is projected to be in 2027. Let that sink in.
Ok, I should clarify. Cryptocurrencies are like cash, but digital. Like cash, there's no tracking, minimal protections (you'd file a police report like you would w/ cash), etc. You do need internet access to process the transaction, but that's the same for every other form of digital cash (e.g. debit/credit).
The only reason you'd ever need an account anywhere is to use a public exchange. You can trade directly P2P with your own generated key if you want (i.e. you can hand someone $200 and they'll transfer some crypto to your wallet address), and the only requirement is to have some kind of wallet to manage your key (also technically optional, but looking up your balance would suck w/o a wallet). And the only reason you'd need an account at all is because of government, which is there to reduce tax evasion and money laundering.
So if you think of it like a privacy-respecting checking account, it'll make a lot more sense.
Technically true, but generally speaking your cash transactions are the same price as debit/credit transactions, so a portion of your payment goes to subsidize those. Some places have a cash discount, but that's pretty rare. Likewise, some places have a crypto discount, which at least for based.win, more than compensates for the crypto transaction fee.
Cryptocurrencies bake in the payment processing network, and on average, Monero's fees (<$0.01) are much cheaper than debit fees, which are much cheaper than credit card fees (usually around 3%).
The same goes with cryptocurrencies, you can do transactions in person if you want. Depending on some factors, it can take a little while for transactions to finalize (but generally shorter than debit/credit transactions), but you'll see the updated balance pretty much immediately. Yes, you'll need an internet connection, but that's the case for pretty much everyone these days, and I think only one party needs the connection to process the transaction.
Same with your crypto. As long as I control my wallet, every exchange could be compromised and my crypto would be 100% fine. As long as you never upload your keys anywhere, it can only get compromised through physical theft, just like cash. But unlike cash, if I have a backup key, I can potentially move my cash before the thief has an opportunity to, and if my key is locked, they can't access it w/o breaking the encryption.
Cryptocurrencies can be as secure as you want them to be. If you follow the 3-2-1 principle of digital backups, you should be fine:
If you upload your keys somewhere, encrypt them with a password you know, and consider having backups of that password as well.
That's absolutely true, but that's because it's so broadly used. This is a chicken-and-egg problem. Cryptocurrencies are primarily used for speculation because they haven't been adopted by vendors, and vendors won't adopt it because it's too volatile due to speculation.
That's why I like Monero. It makes mining unprofitable, so the only people mining are those who care about the network and are willing to take a net loss. What this means is that there's a lot less speculation, so prices seem to be a bit more stable (esp. over the last 2 years or so). But if you're using it as regular spending money, fluctuations will be relatively small since you'll only be holding it for a couple weeks or so. Since there are only a handful of vendors that I currently use with it, I put in much less than $100/month, so if it goes up or down by 5%, it really doesn't impact me all that much. Bigger moves will generally happen over a longer term than regular expenses, so it doesn't really matter.
As more people use cryptocurrencies for regular transactions, prices should stabilize. It'll probably stabilize to be inflationary, so maybe it will become a good store of value in the future, but for now, I only recommend it for short-term storage for regular expenses (e.g. a VPN or online shopping).