Intro to Crypto and Defi

Intro to Crypto and Defi

Why Store coins on a Ledger?

If you keep your coins on an exchange, they’re not your coins! If you hold coins on a Ledger (a hardware wallet) for years, there’s no profit to report on your taxes until you sell.

The more crypto you have, have another hardware wallet, like a Ledger. You can store them in different places.

It makes sense to buy a hardware wallet direct from Ledger and not a used one.

I would not buy crypto through a mutual fund or ETF. Look up the fees at your brokerage and compare returns with HODLing BTC or ETH.               

My Picks: BTC/ETH/LINK/SPELL

Binance.us is an easy-to-use brokerage. There are other brokerages that are much more complicated. With Binance, it’s simple to put your coins on a Ledger. You can loan your coin (defi) on Binance. This is a good way for a beginner to get into defi.

Misc.

  1. Google and read the whitepapers of the cryptocurrencies you’re interested in. Whitepapers are similar to a prospectus. Whitepapers describe the purpose, goals, # of coin, and the hurdles the coin faces. The Satoshi Papers are Bitcoin’s whitepaper. (I enjoyed The Bitcoin Standard.)
  2. You can see when major holders of a coin buy and sell crypto at whalealert.io.
  3. Astronomical defi yields (10,000%, etc.) are very risky. There is a real possibility of total loss.
  4. “Bitcoin maxis” are more political and do not seek “alpha” like other traders will normally attempt to do. (We are still pretty early to cryptocurrencies, however.)
  5. The Twitter account “BowTied Bull” offers a defi education substack you should find very helpful if you want to dive deep into defi.
  6. You can lend stable coins for interest. We learned stable coins are risky too.
  7. Chainlink ($LINK) hopes to make stocks available on the Blockchain.
  8. Cryptocurrencies and the NASDAQ tend to move together. But then what would you anticipate happening if the big banks failed? In that case you might be glad you had coins on a Ledger.

If you want to announce you’re “dropping alpha,” click here.

If you purchase or open accounts through the links to Ledger and Binance.us, I will receive a small commission. Please limit crypto purchases to what you can afford to lose.

You may find our Glossary page helpful.