Introduction 1
About This Book 1
Foolish Assumptions 2
Icons Used in This Book 2
Beyond the Book 3
Where to Go From Here 3
Book 1: Cryptocurrency Basics 5
Chapter 1: What Is a Cryptocurrency? 7
Beginning with the Basics of Cryptocurrencies 8
The definition of money 8
Some cryptocurrency history 9
Key crypto benefits 9
Common crypto and blockchain myths 10
Risks 11
Gearing Up to Make Transactions 12
Wallets 12
Exchanges 12
Communities 13
Making a Plan Before You Jump In 14
Chapter 2: How Cryptocurrencies Work 15
Explaining Basic Terms in the Cryptocurrency Process 15
Cryptography 17
Nodes 18
Mining 18
Proof of work 19
Proof of stake 19
Proof of importance 20
Transactions: Putting it all together 20
Cruising through Other Important Crypto Concepts 21
Adaptive scaling 21
Decentralization 21
Harvesting 21
Open source 22
Public ledger 22
Smart contracts 22
Stick a Fork in It: Digging into Cryptocurrency Forks 23
What is a fork, and why do forks happen? 23
Hard forks and soft forks 24
Free money on forks 25
Chapter 3: Introducing Cryptocurrency Wallets 27
Defining Cryptocurrency Wallets 27
A few important terms 28
How a wallet works 29
Looking at Different Types of Wallets 30
Online wallet 31
Mobile wallet 32
Desktop wallet 33
Hardware wallet 34
Paper wallet 35
Choosing a Crypto Wallet 36
Based on security 37
Based on your crypto ownership 37
Based on transaction fees 38
Based on anonymity 38
Keeping Your Wallet Secure 39
Back up your wallet 39
Have multiple wallets 40
Add more security levels 40
Update your software 41
Remember where you hide it! 41
Chapter 4: Different Types of Cryptocurrencies 43
Celebrating Celebrity Cryptocurrencies by Market Cap 43
Bitcoin 45
Ethereum 46
Ripple 48
Cardano 50
Other top ten major cryptos 52
Top 100 major cryptos 53
Cryptocurrencies by Category 53
Payment cryptos 54
Privacy cryptos 55
Platform cryptos 55
Exchange-specific cryptos 56
Finance/fintech cryptos 57
Legal and property cryptos 57
Book 2: Blockchain Basics 59
Chapter 1: Introducing Blockchain 61
Beginning at the Beginning: What Blockchains Are 61
What blockchains do 62
Why blockchains matter 63
The Structure of Blockchains 64
Blockchain Applications 66
The Blockchain Life Cycle 66
Consensus: The Driving Force of Blockchains 68
Blockchains in Use 69
Current blockchain uses 70
Future blockchain applications 71
Chapter 2: Picking a Blockchain 73
Where Blockchains Add Substance 73
Determining your needs 74
Defining your goal 75
Choosing a Solution 76
Drawing a blockchain decision tree 77
Making a plan 78
Chapter 3: Getting Your Hands on Blockchain 81
Diving into Blockchain Technology 82
Creating a secure environment 82
Buying your first Bitcoin 85
Building a Private Blockchain with Docker and Ethereum 86
Preparing your computer 87
Building your blockchain 89
Chapter 4: Beholding the Bitcoin Blockchain 91
Getting a Brief History of the Bitcoin Blockchain 92
The New Bitcoin: Bitcoin Cash 94
Debunking Some Common Bitcoin Misconceptions 96
Bitcoin: The New Wild West 97
Fake sites 97
No, you first! 98
Get-rich-quick schemes 98
Mining for Bitcoins 98
Making Your First Paper Wallet 99
Chapter 5: Encountering the Ethereum Blockchain 101
Exploring the Brief History of Ethereum 102
Ethereum: The Open-Source World Wide Computer 103
Decentralized applications: Welcome to the future 104
The power of decentralized autonomous organizations 105
Hacking a Blockchain 108
Understanding smart contracts 108
Discovering the cryptocurrency Ether 109
Getting Up and Running on Ethereum 109
Mining for Ether 110
Building your first decentralized autonomous organization 110
Uncovering the Future of DAOs 112
Putting money in a DAO 112
Building smarter smart contracts 113
Finding bugs in the system 113
Creating Your Own ERC-20 Token 114
Chapter 6: Getting Your Hands on Hyperledger 115
Getting to Know Hyperledger 116
Identifying Key Hyperledger Projects 117
Focusing on Fabric 117
Investigating the Iroha project 117
Diving into Sawtooth 119
Building Your System in Fabric 121
Building Asset Tracking with Hyperledger Composer 121
Working with Smart Contracts on Hyperledger 122
Chapter 7: Financial Technology 123
Hauling Out Your Crystal Ball: Future Banking Trends 123
Moving money faster: Across borders and more 125
Creating permanent history 126
Going International: Global Financial Products 127
Border-free payroll 129
Faster and better trade 129
Guaranteed payments 130
Micropayments: The new nature of transactions 130
Squeezing Out Fraud 131
Book 3: Bitcoin 133
Chapter 1: Bitcoin Tech Explained 135
Understanding That There Is No Bitcoin! 136
Discovering the Bitcoin Ledger 136
So where is this Bitcoin ledger? 137
Bitcoin uses a blockchain ledger 138
Looking at the Bitcoin Distributed, Peer-to-Peer Network 138
Using the Bitcoin Blockchain's Blocks of Business 141
Hashing the blocks 141
The Bitcoin blockchain is immutable 142
Finding Out How the Ledger Functions 144
Your address: where your money is stored in the ledger 144
What's the crypto in cryptocurrency? 145
Public key encryption magic 147
Messages to the blockchain 149
Signing messages with the private key 149
Sending a transaction message to the Bitcoin ledger 150
Unraveling the message 151
But you'll need a wallet 152
Chapter 2: Buying, Using, and Selling Bitcoin 155
Finding the Price of Bitcoin 156
Your Options for Acquiring Bitcoin 157
Bitcoin ATMs 158
Retail Bitcoin 169
Person-to-person trading 170
Bitcoin exchanges 172
Bitcoin Back on Credit and Debit Cards 185
Earning Your Bitcoin 185
Mining Bitcoin 187
Finding Bitcoin Everywhere 187
Selling Your Bitcoin 187
Chapter 3: Taking Control of Your Wallet (and Hodling Your Bitcoin) 191
What Is a Wallet? 192
Wallets store private keys 192
Wallets create and store keys and addresses 193
Wallets communicate with the Bitcoin network 193
Wallets can be hot or cold 194
Exploring Wallet Hardware 194
Brain wallets 195
Paper wallets 195
Metal wallets 195
Hardware wallets 196
Web wallets 198
Dedicated full nodes 198
Software wallets 199
Finding a Wallet 199
Setting Up a Bitcoin Wallet 201
Creating and securing your first wallet 202
Creating a 24-word seed 205
Increasing security with a fake account 207
Receiving Bitcoin 207
Getting those notifications 209
Checking your addresses 210
Sending Bitcoin 211
Following the money 214
Backing up your wallet 214
Importing (or recovering) a wallet 216
Creating a watch-only wallet 217
Exploring multiple-signature wallets 219
Using the Lightning Network 225
Chapter 4: Keeping Your Bitcoin Safe 227
Understanding How You Can Lose Control of Your Bitcoin 227
Grasping the Goal: Private Key and Seed Protection 229
Making a Choice: Custodial or Private Wallet? 231
Devising Your Cryptocurrency Safety Plan 232
Producing powerful passwords 232
Protecting passwords with password programs 233
Protecting your computer 235
Watching out for sophisticated phishing 236
Employing two-factor authentication 239
Exploring More Ways to Protect Your Bitcoin (and Everything Else) 243
Knowing What Happens When You Kick the Bucket 245
Choosing the multi-sig solution 246
Scheduling future transactions 246
Using a digital inheritance feature 247
Book 4: Ethereum 249
Chapter 1: Getting to Know Ethereum 251
Exploring Ethereum's Consensus, Mining, and Smart Contracts 252
Buying, Spending, and Trading Ether 254
Getting Started with DAO and ICO 256
Delving into Development Tools 258
Chapter 2: Exploring Use Cases for Ethereum 259
Diving into Ethereum Applications 260
Exploring Financial Services 261
Banking 262
Creating Ethereum escrow applications 264
Examining ICOs 264
Establishing Digital Identity Management 265
Managing individual and device identities 266
Reducing fraud and identity theft 267
Examining the ERC-725 standard and beyond 267
Examining Industry Applications 267
Healthcare 268
Energy 268
Supply chain 269
Enabling Effective Governance 270
Tax payment 270
Government spending 271
Voting 271
Policy development 271
Notary 272
Chapter 3: Examining the Ethereum Ecosystem and Development Life cycle 273
Exploring the Ethereum Blockchain Block Structure 274
Describing Smart Contracts 278
Introducing Solidity, the Language of Smart Contracts 279
Working with the Ethereum Virtual Machine 281
Fueling Your Code with Gas 282
Surveying Tools for Developing, Testing, and Deploying Ethereum Apps 283
Ethereum blockchain client 284
Development and testing blockchain 284
Compiler and testing framework 285
Source code editor/IDE 286
Describing the Ethereum Development Life cycle 287
Introducing Smart Contract Development Tools 288
Chapter 4: Getting and Configuring Ethereum Development Tools 289
Examining Why Multiple Ethereum Development Tools Are Available 290
Downloading, Installing, and Configuring All the Pieces 291
Installing the blockchain client 291
Installing the test blockchain 295
Installing the testing environment 299
Installing the IDE 304
Chapter 5: Building Your First Ethereum Apps 309
Validating Your Ethereum Development Environment 310
Creating a Truffle project 310
Editing the Truffle config file 311
Exploring the Ganache Test Environment 313
Designing Simple Smart Contracts 315
Coding Your First Smart Contract 316
Running Your First Smart Contract 318
Writing your code 318
Compiling your code 319
Deploying your code 320
Invoking your code's functions 322
Paying as You Go 323
Chapter 6: Discovering Smart Contracts 325
Introducing Supply Chain and Common Challenges 326
Describing supply chain 326
Identifying difficulties when implementing a supply chain 327
Examining How Blockchain Can Help Resolve Supply Chain Problems 328
Implementing a Blockchain Supply Chain Solution 329
Paying for supply chain services 329
Managing assets on the supply chain 330
Digging into Solidity 332
Describing Basic Smart Contract Syntax 333
Declaring a valid compiler version 334
Commenting your code 334
Importing external code 335
Defining your smart contracts 335
Handling Data in Solidity 336
Finding Out about Computation and Gas 340
Exploring Access Modes and Visibility of Smart Contract Functions and Data 342
Controlling Execution Flow 344
Handling Errors and Exceptions 345
Chapter 7: Writing Your Own Smart Contracts with Solidity 347
Reviewing Supply Chain Design Specification 348
Payment token smart contract 349
Supply chain smart contract 350
Creating New Smart Contracts 351
ERC-20 token interface 353
ERC-20 token smart contract 354
Supply chain smart contract 355
Coding Primary Functions 357
ERC-20 token functions 357
Supply chain functions 360
Using Events 363
Defining events 365
Triggering events 366
Introducing Ownership 368
Designing for Security 370
Implementing Minimal Functionality 371
Chapter 8: Testing Ethereum Apps 373
Understanding Ethereum dApp Testing 374
Writing tests from the beginning 374
Choosing the right test blockchain 374
Walking through the steps in the testing life cycle 375
Testing for software quality 375
Deploying a dApp to a Test Ethereum Blockchain 376
Telling Truffle to use the Ganache blockchain 376
Deploying your code to the Ganache blockchain 378
Writing Tests for Ethereum dApps 379
Testing using the command line 379
Writing test cases in JavaScript 384
Logging and Handling Errors 386
Handling errors in Solidity 386
Logging activity in smart contracts 387
Fixing Bugs in a dApp 388
Chapter 9: Deploying Ethereum Apps 391
Test Blockchain Options versus Live Blockchains 392
Testing with the Ganache blockchain 392
Deploying your code to other test blockchains 394
Anticipating Differences in Live Environments 395
Preparing Your Configuration for Deploying to
Different Networks 396
Deploying a dApp 398
Getting enough Ether 399
Compiling your code 403
Deploying your code 403
Book 5: Cryptocurrency Investing 405
Chapter 1: Why Invest in Cryptocurrencies? 407
Diversifying from Traditional Investments 408
Stocks 408
Bonds 410
Forex 411
Precious metals 413
Gaining Capital Appreciation 414
Historical returns 415
Huge growth potential 416
Increasing Income Potential 417
A bit about traditional dividends 418
The basics on crypto dividends 418
Fueling Ideological Empowerment 419
The economy of the future 419
Freedom from government control of currency 420
Help for the unbanked and underbanked 421
Chapter 2: Recognizing the Risks of Cryptocurrencies 423
Reviewing Cryptocurrency Returns 424
Capital gains (or losses) 424
Income 424
Risk: Flipping the Other Side of the Coin 425
Glimpsing Cryptocurrencies' Reward versus Risk 426
Digging into Different Kinds of Risk 427
Crypto hype risk 427
Security risk 428
Volatility risk 430
Liquidity risk 430
Vanishing risk 431
Regulation risk 432
Tax risk 432
Exploring Risk Management Methods 433
Build your emergency fund first 434
Be patient 435
Diversify outside and inside your cryptocurrency portfolio 437
Chapter 3: Cryptocurrency Exchanges and Brokers 439
Distinguishing Crypto Exchanges 440
Centralized exchanges 440
Decentralized exchanges 442
Hybrid exchanges 444
How to choose an exchange 445
Considering Brokers 449
How brokers work 449
The pros and cons of using a broker 450
How to choose a broker 451
Looking at Other Methods for Buying Cryptos 452
Funds 452
Credit card 453
PayPal 453
Cash 453
Cryptocurrency ATMs 454
Chapter 4: Identifying Top-Performing Cryptocurrencies 455
Introducing the Invest Diva Diamond Analysis 456
Using Fundamental Analysis to Pick Cryptocurrencies 457
Go with what you know 458
Choose the right categories 458
Check out cryptos' websites 459
Choosing Cryptos with Sentimental Analysis 461
Key sentimental elements 462
Stuff to check in the news 464
Trying Technical Analysis to Select Cryptos 466
Chapter 5: Diversification in Cryptocurrencies 467
Breaking Down Some Basics on Diversification 467
What is traditional diversification? 468
How does diversification reduce risk? 468
Using Cryptocurrencies in Long-Term Diversification 470
Diversifying with non-cryptocurrencies 471
Diversifying among cryptocurrencies 473
Tackling Diversification in Short-Term Trades 477
Chapter 6: Getting Ahead of the Crowd: Investing in ICOs 479
Understanding the Basics of Initial Coin Offerings 479
How an ICO works and how to start one 480
ICOs versus IPOs 481
Investing in an ICO 483
Finding ICO listings 483
Analyzing an ICO listing 484
Outlining the ICO investment process 486
Holding your tokens after your purchase 486
So You Want to Start an ICO: Launching an ICO Yourself 487
Understanding the challenges 487
Taking a few steps before the launch 488
Chapter 7: Stocks and Exchange-Traded Funds with Cryptocurrency Exposure 491
Looking for Stocks with Exposure to Cryptos 492
Fundamentals 492
Market sentiment factors 494
Other considerations 495
Considering Cryptocurrency and Blockchain ETFs 496
Getting an overview of blockchain ETFs 496
Keeping an eye on other indexes 498
Chapter 8: Cryptocurrency Futures and Options 499
Focusing on the Fundamentals of Futures 500
Futures' features 500
Financial futures 501
Introducing the Basics of Options 502
Futures versus options 502
Puts and calls 503
Risks 503
Understanding Cryptocurrency Derivatives Trading 504
The advantages of crypto derivatives trading 504
The advantages of crypto derivatives for the industry 504
Trading resources 505
Chapter 9: Dealing with the Dollar and Other Fiat Currencies 507
Considering the World's Reserve Currency: The U.S Dollar 508
Focusing on factors that affect the U.S dollar 508
Looking at Bitcoin versus the U.S dollar 509
Examining the Euro and Other Major Currencies 511
The euro and the British pound 512
Safe havens: The Swiss franc and the Japanese yen 513
The Aussie, Kiwi, and Loonie dollars 513
Comparing the Forex Market and the Crypto Market 514
The similarities 514
The differences 514
Resources for forex trading 515
Chapter 10: Using Technical Analysis 517
Beginning with the Basics of Technical Analysis 518
The chart art 518
The time factor 520
The psychology factor: Trends 521
Spotting the Key Levels 521
Support levels 522
Resistance levels 523
Trends and channels 523
When the trend is no longer your friend 525
Picking Out Patterns on a Chart 525
Bullish reversal patterns 525
Bearish reversal patterns 526
Smoothing Charts Out with Moving Averages 527
Basic moving averages 527
Sophisticated moving averages 528
Chapter 11: Short-Term Trading Strategies 529
Distinguishing Three Short-Term Time Frames 529
Profiting within hours 530
Profiting within days 533
Profiting within weeks 534
Trying Short-Term Analysis Methods 535
Deciphering chart patterns 536
Using indicators 539
Avoiding illegal pump-and-dump stuff 540
Managing Short-Term Trading Risk 540
Chapter 12: Long-Term Investing Strategies 543
Time Is on Your Side: Getting Started with Long-Term Investing 543
Your personal goals and current situation 544
Your portfolio's objectives 545
Creating Long-Term Strategies 546
Observing psychological levels 547
Selling when you reach your goal 547
Keeping tax consequences in mind 548
Considering Limit and Stop-Loss Orders 548
Limit orders 548
Stop-loss orders 549
Chapter 13: Minimizing Losses and Maximizing Gains 551
Keeping the Losses Down 552
Measuring returns 552
Monitoring exchange fees 553
Understanding the art of getting out 554
Letting the Profits Rise 556
Buying at the bottom 556
Knowing that patience is a profitable virtue 557
Identifying the peaks 557
Finding peaks and bottoms with a few trading tools 559
Chapter 14: Using Ichimoku and Fibonacci Techniques 561
Getting a Handle on Ichimoku Kinko Hyo 561
The components of Ichimoku Kinko Hyo 562
Ichimoku interpretations 563
Introducing Fibonacci Retracement Levels 564
Some background on Fibonacci 565
How to insert Fibonacci retracement levels into your chart 565
Combining Ichimoku and Fibonacci Techniques 566
Chapter 15: Taxes and Cryptocurrencies 569
Distinguishing Three Types of Crypto Taxes 569
Income taxes 570
Long-term capital gain taxes 570
Short-term capital gain taxes 571
Minimizing Your Crypto Taxes 572
Lowering your mining income tax 572
Reducing your trading tax 572
Bringing down your capital gain taxes 573
Checking the rate of your state 574
Evaluating Taxable Income from Crypto Transactions 574
Tracking your crypto activity 574
Handling crypto forks 575
Reporting international crypto investments 575
Book 6: Cryptocurrency Mining 577
Chapter 1: Understanding Cryptocurrency Mining 579
Understanding Decentralized Currencies 580
Exploring the Role of the Crypto Miner 581
Making Cryptocurrency Trustworthy 582
Reaching Agreement through Consensus Algorithms 584
Looking at the Cryptocurrency Miner 585
Making the Crypto World Go 'Round 587
Chapter 2: Exploring the Different Forms of Mining 589
Proof-of-Work Algorithms 589
Proof-of-work applications 591
Proof-of-work examples 592
Upsides 594
Downsides 595
Proof-of-Stake Algorithms 596
Proof of stake explained 596
Proof-of-stake selections 598
PoS example cryptocurrencies 599
Upsides 600
Downsides 600
Hybrid Proof of Stake/Proof of Work 601
Hybrids explained 602
Hybridized examples 604
Upsides 604
Downsides 605
Delegated Proof of Stake 605
Delegated Byzantine Fault Tolerance 605
Proof of Burn 606
And MORE 607
Chapter 3: Mining Made Simple: Finding a Pool and Preparing an Account 609
Understanding How Pool Mining Works 610
Choosing a Pool 612
Pools that are good starting points 612
A few of the largest pools 613
Incentives and rewards 615
Pool ideology 618
Pool reputation 618
Pool fees 620
Pool percentage of the total network 620
Setting Up a Pool Account 622
Server choice 623
Mining equipment pool settings 623
Payout addresses 624
Payout thresholds 624
Researching Mining Pools 625
Cloud Mining 626
Chapter 4: Picking a Cryptocurrency to Mine 629
Determining Your Goal 630
Mineable? PoW? PoS? 632
Researching Cryptocurrencies 633
Mining profitability comparison sites 633
Algorithms and cryptocurrencies 637
The cryptocurrency's details page 645
Mining-profit calculators 646
The cryptocurrency's home page 647
GitHub 648
The cryptocurrency's Wikipedia page 649
Mining forums 650
Going Deep 650
Longevity of a cryptocurrency 650
Hash rate and cryptocurrency security 651
Community support 652
Knowing That Decentralization Is a Good Thing 654
Finding Out It's an Iterative Process 658
Chapter 5: Gathering Your Mining Gear 659
Selecting the Correct Computational Mining Hardware 659
Specified hash rate 660
Specified power consumption 662
Equipment cost and other considerations 667
Length of time your hardware will be viable 668
Mining Equipment Manufacturers 670
ASIC rig producers 670
GPU rig producers 671
Finding a Wallet to Store and Protect Your Private Keys 671
Where to Mine? Selecting a Viable Location 672
Vet your home for cryptocurrency mining 672
Communication requirements 672
Power source thoughts 674
Data centers and other dedicated commercial locations 677
Chapter 6: Setting Up Your Mining Hardware 681
ASIC Mining Rigs 681
Racks 682
Power supply 683
PDUs 684
Network and Ethernet connection 686
A computer to control your rig 686
GPU Mining Rigs 689
Getting your GPU rig online 689
Building your own GPU miner 690
CPU Mining 700
Mining Software 701
Pool mining 701
Solo mining 705
Chapter 7: Running the Numbers: Is It Worth It? 707
Factors That Determine Mining Profitability 708
Cost of equipment 708
Hash rate of your equipment 710
Mining rig efficiency 713
Cost of electricity 717
Total network hash rate 720
Information about your pool 721
Block earnings 721
Cryptocurrency conversion rate 722
Calculating Your ROI 722
Your block earnings 723
Your expenses 726
Calculating ROI 727
Knowing the unknowns 728
Online profitability calculators 728
Historical estimates 730
Chapter 8: Reducing Negatives and Gaining an Edge 733
Profitability through Efficiency 734
Upgrading aging equipment 734
Mining different cryptocurrencies 734
Using exhaust heat 735
Reducing electricity bills 736
Knowledge Is Power 738
Why current events are important 739
The fork wars 740
Your forking decisions 743
Here Today, Gone Tomorrow 747
Evaluating Your Mining Resources 748
Increasing mining competition 749
Increasing block difficulty 749
Diminishing returns due to halving events 749
Chapter 9: Running Your Cryptocurrency Business 753
What to Do with Your Mined Cryptocurrency 754
Convert your cryptocurrency 754
Buying equipment and paying bills 754
Paying with crypto when you can't pay with crypto 755
Expand or upgrade your mining operation 757
But don't forget the tax 757
Hodling your cryptocurrency 757
Invest your cryptocurrency 759
Donate your cryptocurrency to charity 760
Gift your cryptocurrency 760
Determining When to Sell 761
Cryptocurrency market indicators 761
Where to sell: Cryptocurrency exchanges 764
Dollar Cost Averaging 764
Dollar cost averaging your purchases 765
Cost averaging your exits 766
Custodial exchange risk 767
Tax and Your Mining Business 767
But you're mining, not investing 767
It gets complicated 769
Scaling Up? 770
Do not overextend 770
Milestones to meet before you reinvest 771
Planning your expansion 773
Index 775
