A Beginner’s Guide to Bitcoin

Total beginner to Bitcoin? Good. This video is exactly for you. Right off the get go, beginner’s guide. This assumes that you’re just, yeah, I’ve heard of cryptocurrencies. I’ve heard of Bitcoin, but
I, that’s pretty much it. I’ve heard of it. I don’t know much else about it. This is the video for you. If you’re sitting there saying, hey, look, is this video gonna,
when I’m done with it, I’m gonna be making millions
of dollars per week trading? No, no, that’s not what this is about. I don’t need any people showing
up in the comments section, oh, click bait. No, no, no, this is just, fair warning. You can turn it off right now. I’m not offended. But if you just have no idea
what any of this really is, perfect, this is the video for you. Let’s break it down from
just the very kind of root word of things and
we’ll go from there. So first part, currency. Currency is just a form of money. All different countries have
their own form of currency. The United States has the dollar. Japan has the yen. The European Union has the euro. You know, the United Kingdom,
England, has the pound. Those are just all different currencies, or in other words, types of money. So currency is just a type of money. But what I wanna focus on
here is the word crypto. So what exactly does crypto mean? Let me get the definition up there, then we’ll talk about it. Now that we have crypto up
here, what does that mean? A combining form meaning hidden or secret. That probably is like,
okay, that helps me zero. All right, so, let’s break it down. Let’s look at combining form, and this will mean a little bit more sense when we get to the whole
mining part of things. But just keep in mind
mining form, and secret. Yeah, that’s okay, it’ll work. But I’m just gonna eliminate that. The main thing that I wanna
focus on here, though, is once again hidden. Combining form and hidden, and that’s where the whole
currency is coming from, which leads into, okay, well, yeah, okay Clay, that’s, I get it. It’s a currency. It’s a form of money, but still, where is cryptocurrency coming from? Why does it have value? Well, let’s address that real quick. Why does it have value? Simply put, what does value come from? Right here. Value equals belief. Guess I’m kind of broke. I have a dollar though. Is this worth anything? No, it’s not. Well, I don’t know. If I took this to the recycle
company maybe I could get a half a penny because it’s paper. It’s got some ink on it. So no, this is not worth anything. But you’re saying, what
are you talking about Clay? That’s a dollar bill,
that’s worth a dollar. Why is that worth a dollar? Because you believe it is. Why do you believe it is? Well, because it’s backed by
the United States of America, and that’s what’s giving
this actually value. So that is where value comes from. What is value actually
defined as other than belief? What can value get you? Let’s see. I remember the days when
this, dollar matinees. I could go to the movie theater. Here, take a dollar, and that would get me some
sort of service, right? I would be able to see a movie. So that’s what value does. It gets you some sort
of product or service. So you’re saying, well, okay, I get it. But how does Bitcoin
have any sort of value? Where is all this belief coming from? You know, that’s kind of a good question, but there’s enough belief out there now where Bitcoin, as a
currency, as a form of value in terms of getting a product
or a service, is out there. Now, not everybody takes Bitcoin, but there’s more and
more merchants and such that are starting to take it. Why? It’s just why, it’s pretty
much why it’s kind of an amazing story, why it’s such a phenomenon. Because people are believing it. And more and more people
are believing in it, and that’s why prices, at least
at the time of the recording of this video, have gone up and up and up because the more people
that believe in something, the more value that it has. And of course, the less
people that believe, well, then that’s how prices
are fluctuated in the market. So how, why are people believing? Why, hey, that’s the
million-dollar question. That’s what makes it such
a phenomenon in itself. But the point being, is
enough people do believe in cryptocurrency, particularly Bitcoin, where it does now have value. So that is where the value is coming from, it’s just strictly enough
people are believing in it, are supporting it as some sort of means to purchase products and services. But where exactly is it coming from? How is it being created? The good old US of A, we have
probably a printing press down in the basement of the White House and we just spit out money left and right. Not really, it’s all,
like, which is kinda scary, you just press a button, hey, there we go, I just created a million dollars. But how is Bitcoin actually created? Well, created isn’t
necessarily the word to use. What needs to be used is mining. So instead of mining for
gold, silver, diamonds. You are mining for Bitcoin. So how exactly is this mining working? Well, let’s come back
here with combining forms. And the combining form
here is you just have, and this is gonna be a
good time, let’s see, I’m gonna go back to school here. So we have for you
Calculus fans out there, and I’m just totally making this up, I’m not even sure if this
even makes any sense anymore, but the summation and then, yeah, we have, I forget what these are
called but I think that makes it positive, then
we have the square root, then you can throw numbers over here. And then, I don’t know,
let’s just divide this by x times y, and then you
gotta divide that by the square root of five squared,
and then you have to divide all this by pi
times two, divided by four. ‘kay, there we go. So this is a combining of a
whole bunch of just stuff, but what this is really getting
at is there is some sort of complex math problem. Complex number problem. AKA, you don’t know the answer to it. You have to figure it out. So it’s hidden, right? It is hidden, and you need to
try to figure out a solution. Well, I should say, if you want a Bitcoin. If you want to create a Bitcoin, you need to be able to figure that out. Now you may be thinking, well, Clay, I do not have a degree in mathematics. I don’t have anything of that sort. Well, the people that are
working on this complex problems are gonna be just computers. You could probably call
’em supercomputers, but some people, I mean, you
can see, and they just have hallways and hallways full of computers that are trying to crack
these complex math problems. Again, don’t leave in
the comments section, Clay, that’s mathematically impossible. I don’t even know what that means, okay, I just made it up and I was having fun. But it’s supposed to
represent a complex issue that’s hidden and it’s
combining a bunch of things, and when you combine
this stuff, it’s just, you know think about cryptotography, and other words where crypto
is within the root word. But that’s what’s going on, and computers are trying to solve these. If they do solve them,
then a Bitcoin is created. And these are not, like,
you know, I don’t know, the quadratic formula where even I could probably still figure that one out. No, these are very, very, did
I say very, complex problems. So it’s not like Bitcoins
are coming into creation all over the place over and over again. There’s a very structured
manner behind it, but that is how they are figured out. And I’m not going to go
into the history of how this was all created, but somebody
very smart created it, blockchain technology is the term of it. And, again, why do people
believe in this stuff? Hey, that’s what makes it a phenomenon. It’s crazy, but it’s working,
and I’m sure people could tell you why it’s believing,
’cause the technology is there and more and more people are
believing the technology. And that is why, but as far as why has it caught on as much as it has? Well, that’s just what makes
some people say it’s a bubble, other people say it’s here to stay. So I don’t know, your
opinion, that’s up to you. But as far as what a cryptocurrency is, and in this case Bitcoin, there
are lots of other Bitcoins, or other cryptocurrencies out there. So whether you replace
Bitcoin with one of the other currencies, there seems to
be a new one every week. That is what’s going on here. It is just a digital
currency that has been formed by computers, algorithms,
big complex problems that when they’re solved, it creates
a form of that currency. And why is the belief there? Where is all the value coming from? Well, valuing comes from
enough people have faith in it, and when people have faith in something, they are willing to believe in it and offer products and services for it. I guess for me personally,
as of a few weeks ago, we started to accept
Bitcoin on claytrader.com. So chalk me up in the believer. Because I’m a believer,
I take value in it, and I accept it as a form of payment. So that’s a real-world example. Why do I personally believe in it? I don’t know, I guess because
enough other people do now so I’m just jumping on the bandwagon, and sure, that doesn’t make me a pioneer, but, hey, it is what it is. But there’s a little
real world example of how Bitcoin has expanded
out a little bit more. I now accept it, like I
said, as payment for courses and the chatroom and all that. So that is what Bitcoin is. I realize this was not how to
trade it or anything like that but this is how it all breaks down. So don’t be intimidated by this. It’s just a form of
money that’s been formed through all these processes
and now that enough people believe in it, it does have
value associated with it. But again, value is
gonna shift with belief. The more belief, the higher the value. If all of a sudden less people
and more and more people, let’s say, start to not believe in it, well then values are gonna go down, and that’s just basic supply and demand. But hopefully this helps,
and if you enjoyed this, click that like button. If you’d like for me to
do more Bitcoin videos, then definitely click the like button, leave comments down below, and throw out questions that you have that maybe I can help
answer with some more future Bitcoin cryptocurrency-type videos. But hopefully this helps you out, and now you have a good
idea of what exactly is a cryptocurrency and
where it all comes from. If you are out there
trading alone currently, and maybe are in the market
looking for a community to join to assist you in your
trading or to just help you, give you another set of eyeballs, then I do have a private
trading community where you can trade alongside me and
other experienced traders so what you see popping
up on the screen right now is both an information link, so if you click on the inner circle one, that is going to take
you to the page where I explain all the details
of what exactly come with the community, both the
chatroom and the newsletter, and then the other
image that has popped up is a behind the scenes
tour where you can see exactly what is going to be
contained within the community. I take you through, like I
said, a behind the scenes tour of everything and that way you’ll know precisely what you are
getting when you join. So definitely check that stuff
out if you are interested and thinking about wanting
to join a community and let me know if you have any questions.

33 thoughts on “A Beginner’s Guide to Bitcoin”

  1. Have you thought of doing a course on Crypto/blockchain (not necessarily just bitcoin) and adding it to your CTU lineup?

  2. This is going to be interesting to learn from. You break things down like the pastor at my church. Kind of like expository preaching except for this is expositional teaching of money. 😉 anything expository is good. It's the best form of teaching and also to learn from.

  3. I remember when I can go to the movie theater on 99 cents. And I'm only 39, and I'll be 40 on January 30th. 😂 lol

  4. I have apps on my tablet that I think it's learning me Satoshi / Bitcoins. Are those things any good? It's actually link to my Bitcoin account in coinbase.

  5. Yup its all about confidence.. the problem with confidence is its fragile, very difficult to earn, very easy to lose and once its lost its almost impossible to regain.

  6. Good video. I particularly like the "value = belief" part. With stocks, I could look at fundamental and technical analysis but with Bitcoin it just wasn't clear to me what was going on. I was trying to figure out what in the hell was the justification for Bitcoin's skyrocketing value. This part answered it for me, it's just positive belief in Bitcoin.

  7. Beginner's guide to cryptocurrency: Stay far away and watch the crash from a distance. There, LOL saved you a ton of time and money.

  8. Hi Clay…..you still trading options much? I've never traded an option in my life, but think I'm ready to give it a try and thinking of buying your first options course. Just wanted to know if you're still trading them.

  9. Hey Clay nice to see you are making these kinds of videos about crypto, and you are right at this point it is too big to ignore.

    In regards to taking Bitcoin as payment on your site there are measures you can take to safeguard your earnings to make sure you at least break even on cost of goods. Not sure how your Bitcoin payment processor works if it is actual physical delivery of Bitcoin or just the converted fiat value at the time of the transaction, but if it is physical delivery you can benefit no matter where the market moves. My friends and I are into mining and also occasionally take Bitcoin payments for various services and what we usually do is cash-and-carry arbing to hedge against our earnings to make sure that no matter where the market moves we are protected.

    We use a site called BitMEX (Bitcoin Mercantile Exchange) and is one of the most robust crypto derivatives markets out there and they offer 3-month, 6-month, and perpetual swap contracts on Bitcoin. Their contracts tend to trade at crazy premiums vs spot which I have seen be upwards of 50-60% adjusted annually. So since you are already earning the underlying asset through your website you can just short an equivalent amount of futures contracts and at the settlement date you can sell the underlying and profit that premium no matter if Bitcoin ends up at $100 or $100,000 at the settlement date.

    Also to all the nonbelievers and haters out there you are welcome to come on BitMEX or any other derivatives market and short all the coins you want at 20x leverage. If you think it's all a scam and going to crash come put your money where your mouth is.

  10. I'm actually still confused after watching this video which is a first for me. Like who creates the math problems and how does solving math problems create you bitcoin out of thin air? I'm so lost lol.

  11. Hi Clay- I've just started watching your videos today, I'm a complete noob, but I'm going to put in the hours and get started. Do you think there is a specific amount of time (roughly) one should invest in (time wise) before one starts to trade?

  12. Gday mate, Just enjoying your trading advice, I’m just wondering if you have an update on what software etc you use now

  13. I like your video. You tried your best to explain it and I GET it’s selling points…It just seems horribly volatile and open for criminal exploitation

Leave a Reply

Your email address will not be published. Required fields are marked *