Easing into Crypto

Warning: If you're new to this podcast and jumped straight to this episode, I suggest you instead start at the beginning. I know that learning the secrets of investing and making money in crypto sounds appealing, but this episode relies on a lot of concepts I've been slowly explaining in a very intentional order across the previous 17 episodes. This is complex stuff, and I think you'll be best served by listening to everything.

- Everything you need to know about specific security practices to keep yourself safe (including seed phrase best practices, more info on hardware wallets, 2FA, browser extensions, specific scams I've been seeing lately, and one more important security risk that I just realized I'd been neglecting)
- Why a token like "Shiba Inu coin" can never reach $1, and how you can use an understanding of market caps to predict how high it’s possible for any coin or token to rise in value
- Learning the concept of "expected return" to give you a more precise way of choosing between two opportunities

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The corresponding blog post with links and images:

https://www.michaelcaloz.com/2021/12/03/easing-into-crypto-part-18-more-preparing-to-invest-security-understanding-what-price-targets-are-realistic-and-using-expected-return-to-choose-between-opportunities/

Warning: If you're new to this podcast and jumped straight to this episode, I suggest you instead start at the beginning. I know that learning the secrets of investing and making money in crypto sounds appealing, but this episode relies on a lot of concepts I've been slowly explaining in a very intentional order across the previous 16 episodes. This is complex stuff, and I think you'll be best served by listening to everything.

- Deciding how much money you have to work with and what percentage you feel comfortable putting into crypto
- How to approach asset allocation, deciding between lump-sum investing and dollar-cost averaging, and choosing between DeFi and CeFi
- Setting up your crypto wallets (including which wallet I use for each blockchain), and several approaches for using your cash to get the coins and tokens you want
- The centralized exchanges I recommend, and figuring out which ones offer which cryptocurrencies
- Understanding different blockchains, how those fit in with exchanges, how to transfer between blockchains, and how to make sure you're getting a coin rather than its token version

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The corresponding blog post with links and images:

https://www.michaelcaloz.com/2021/10/29/easing-into-crypto-part-17-preparing-to-invest-how-much-to-put-in-how-to-split-it-up-to-mitigate-risk-setting-up-your-wallets-buying-the-coins-tokens-you-want-and-dealing-with-different-blockchains/

Warning: If you're new to this podcast and jumped straight to this episode, I suggest you instead start at the beginning. I know that learning the secrets of investing and making money in crypto sounds appealing, but this episode relies on a lot of concepts I've been slowly explaining in a very intentional order across the previous 15 episodes. This is complex stuff, and I think you'll be best served by listening to everything.

- Investing 101: How to think about all this and make money with crypto
- What it takes to beat the market
- Where you might fit in, what kind of investing could be right for you (whether it's in the form of money, time, or energy): synthesizing info, technical focus, psychology & networking, arbitrage, art, gaming, law, collecting, etc.
- What could go wrong (and what to do about it): user error, psychology, unstable stablecoins, centralized stablecoins, market manipulation, scams, regulation, hacking, coordinated attacks

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The corresponding blog post with links and images:

https://www.michaelcaloz.com/2021/10/29/easing-into-crypto-part-16-intro-to-investing-what-could-go-wrong-where-you-might-fit-in-and-what-kind-of-investing-could-be-right-for-you/

- What yield means, and the difference between APR and APY
- Explaining liquidity staking again: key definitions, why liquidity is important, how ICO's work, and a real step-by-step example using the Raydium DEX on the Solana network
- How to choose where to provide liquidity, how to calculate returns, and some information on yield aggregators
- 6 major categories of risk in DeFi: scams, bugs and hacks, high gas fees, rug pulls, foundational risks, and user error
- Where this leaves the TradFi industry

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The corresponding blog post with links and images:

https://www.michaelcaloz.com/2021/09/21/easing-into-crypto-part-15-wrapping-up-defi-lp-tokens-yield-farming-calculating-return-yield-aggregators-and-major-risks/

- DeFi use case #2: insurance
- DeFi use case #3: payments
- DeFi use case #4: derivatives
- Gas fees and alternative blockchains
- DeFi use case #5: currency exchange and liquidity staking, what liquidity is, where DEX's like Uniswap get their coins and tokens, and impermanent loss

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The corresponding blog post with links and images:

https://www.michaelcaloz.com/2021/09/21/easing-into-crypto-part-14-more-defi-insurance-payments-derivatives-blockchains-exchanges-liquidity-staking-and-impermanent-loss/

- How you can make money in crypto while helping to reinvent the banking industry
- DeFi vs. CeFi
- Stablecoins
- 4 reasons DeFi is awesome: passive income, composability (and transparency), less bureaucracy and increased access, peer-to-peer finance
- DeFi use case #1: borrowing and lending (plus yield farming)

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The corresponding blog post with links and images:

https://www.michaelcaloz.com/2021/09/21/easing-into-crypto-part-13-defi-cefi-reinventing-banking-with-peer-to-peer-finance-stablecoins-and-borrowing-lending/

- How DAO's (Decentralized Autonomous Organizations) offer an alternative to traditional corporations, and how they work: membership, voting, governance tokens, identity, collective ownership
- Collective bargaining and the "network state"
- Six DAO's I find interesting: MakerDAO, Universe, Uniswap, Moloch, IndexCoop, and Flamingo

Edit from 10/12: Added a section at 13:21 on DAO's acting almost like unions or lobbyists to advocate on behalf of their members.

Edit from 12/22 (I also ended up updating the audio itself in this episode on January 2, 2022):

In this episode, I say that "If you want to contribute your skills and knowledge to a DAO, it doesn’t matter how old you are, what race or gender you are, or where you live."

I want to clarify, because there's an important nuance here.

When I say that your race and gender "don't matter," I mean it in two senses: (1) that you can choose to stay anonymous if you want, and (2) that, because of the reduced bureaucracy in crypto and DAO's, there are fewer hoops to jump through, and you can deal with smart contracts instead of loan officers or other human bureaucrats who might be racist, sexist, or have other conscious or unconscious biases toward certain identities. 

However, despite all that, identity always matters in a different sense: All races and genders have not been given equal access and opportunity in general in the world, and there's inherent privilege simply in being white, male, heterosexual, non-disabled, etc.

For example, whether or not they're able to be anonymous in crypto, people from historically-marginalized groups (e.g., Black, Indigenous, LGBTQIA+, etc.) have faced many barriers in their lives that have made it harder to accumulate the wealth that could act as their initial investment into crypto and DAO's.

It's ok if all that is confusing or you feel defensive or angry reading it. It's a big subject, and I invite you to read the series I wrote about race in the United States for more information (https://www.michaelcaloz.com/race-for-white-people-part-1/). It's non-political and written in the same style as this crypto series—aiming to be gentle, approachable, and starting from the basics.

Also, here's an excellent thread (by Karsen Daily) on how it's problematic to say that "race and gender don't matter" in regards to crypto and Web3 specifically: https://twitter.com/karsendaily/status/1473534549355155459.

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The corresponding blog post with links and images:

https://www.michaelcaloz.com/2021/08/01/easing-into-crypto-part-12-daos-organizations-managed-by-algorithms-governance-tokens-collective-ownership-and-the-network-state/

- What you can actually do with NFT's: online galleries, digital frames, physical printing, real-world displays, profile pictures, remixes
- Upsides, downsides, and risks
- Where you can find NFT's, and whether or not you should buy them

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The corresponding blog post with links and images:

https://www.michaelcaloz.com/2021/08/01/easing-into-crypto-part-11-wrapping-up-nfts-what-you-can-actually-do-with-them-upsides-downsides-risks/

- NFT category #4: Art. Are physical pieces of art more valuable than digital ones? *Must* they be? *Should* they be? Since Ethereum is programmable, what kind of dynamic art could that allow?
- NFT category #4a: Generative art, artists Tyler Hobbs & Dmitri Cherniak, and how all this makes art more accessible and gives artists more options. Couldn't the artist cheat you? How do you know NFT's are truly unique?
- NFT category #5: Video game characters, in-game items, and objects in virtual reality. The Sandbox, VR trends, and where all this could lead in the future

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The corresponding blog post with links and images:

https://www.michaelcaloz.com/2021/07/31/easing-into-crypto-part-10-more-categories-of-nfts-art-video-games-virtual-reality/

- Quick review of Ethereum (plus some additional details)
- NFT's will seem ridiculous at first, but I'll explain why I changed my mind about them
- NFT's are unique digital assets, which could mean anything from a piece of art, to a digitized DNA sequence, to a weapon in an online video game world, to a virtual pet, to a digital file representing the deed of a house
- Fungibility, and why you should care about NFT's
- NFT category #1: collectibles, how the concept of rarity can work in a digital world, and why rarity can still be desirable even if digital items are technically infinitely copyable
- NFT category #2: research funding and historical significance
- NFT category #3: music, and generative music

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The corresponding blog post with links and images:

https://www.michaelcaloz.com/2021/07/30/easing-into-crypto-part-9-intro-to-nfts-collectibles-research-funding-historical-significance-and-music/