Thread by @acav

As I talk to more people about crypto/NFTs, the aha moments have come from real world analogies. Although web3 is new, the concepts are not. Here's my oversimplified explainer of the space for newbies. Don't let the lingo turn you away, it's not as complicated as it seems! 1/X 🧵

First, let's talk about "the blockchain". It's a system of recording information. That's it. And it's used to record transactions. Imagine a general store in the 1800s. They had a paper ledger where they kept track of who bought what & who owed who & how much everything cost 2/X

But if the ledger was stolen, lost or burned, you lost track of all of that information. 3/X

Today you might keep that on your computer in an Excel sheet. But if your computer breaks or is stolen, you'll still lose that critical data. Enter the cloud: Dropbox or Google sheets has taken it one step further in making you not reliant on that one version on your computer 4/X

Most of us don't think about it, but that information is still centralized. If Google decided to (or had some sort of outage or major issue), you could still lose that data. Or if the servers on AWS that power your cloud account are down, you could lose access for some time 5/X

The blockchain is the next step in that progression. It's a digital ledger of transactions that is not kept in one place (centralized) but is instead duplicated and distributed on every computer in the network of computer systems on the blockchain (decentralized) 6/X

Why is it called the blockchain? Because it consists of a number of "blocks" each with transactions executed in a given period of time. The transaction data can be anything from crypto purchases to voting records to medical data 7/X

To go back to our paper ledger analogy, it's like having a book where you start on page 1 and once page 1 is done, you start on page 2. Then page 3 and so on. Data is stored in order. And each page is a block. 8/X

Since blocks are linked together using cryptography (like a code or cypher, à la WWII encoded telegrams), it's pretty near impossible to change the data in blockchains since it would require a shit ton of computing power to go back and edit something 9/X

So you always have access to the data, and the data is always the same. And that's a surprisingly big deal 10/X

The other thing about data on the blockchain is that it's transparent. You can look up and see every transaction. So you can see the price paid by each person for an individual NFT for example, and if it went up or down. 11/X

Ok, so that's the blockchain. Lots of *really* interesting applications, but not super important to understand how it works in detail if you're just here to buy an NFT. So on to the next topic: cryptocurrencies. 12/X

When people think of cryptocurrencies, the first one they think of is #Bitcoin. There are more than 8,000 cryptocurrencies in existence as of December 2021, most of which we'll never hear of and many of which aren't worth much. So what are they? 13/X

Cryptocurrencies are just like regular currencies (also called "fiat currencies" when they're government-issued). Just like I need to convert my US Dollars to Euros if I want to buy a croissant 🥐in Paris, I need to convert that same USD to ETH or SOL if I want to buy an NFT 14/X

Some people buy cryptocurrencies to buy things (like NFTs) and others do it as an investment. Why as an investment? The exchange rate between fiat currencies like USD and any given cryptocurrency changes over time. Same as USD-EUR 15/X

The huge difference in the crypto space has been the % changes in those exchange rates. Some fiat currencies have less variability (the EUR-USD chart from 1999 to 2021 shows a low of 0.85 and high of 1.56). Some have more (see USD-MXN from 1995 to 2021) 16/X

Now check out Bitcoin (BTC) and Ether (ETH). This is how you end up with crypto millionaires. They bought up a bunch of Bitcoin at 1 BTC = $100 in 2013 or $1,000 in 2017 and sold it at 1 BTC = $50,000 17/X

If you're entering the space today, you may choose to buy some lesser known/newer cryptocurrencies in hope of realizing some of those gains too. Or you may be going to Paris for croissants (want to buy an NFT) and need to purchase the right currency for that (ETH) 18/X

Now, let's get to #NFTs. Let's get the acronym out of the way. NFT = non-fungible token. The person who named it was not a branding person 🤦‍♀️. Think of fungible as interchangeable. If it's exactly the same as any other, it's fungible. If it's unique, it's non-fungible 19/X

For all intents and purposes, the dollar bill in my wallet is fungible. If you and I swap $1 bills, they have the same worth & utility. I don't care which exact bills I get from the ATM. The painting I bought in a gallery is non-fungible. It's unique and not interchangeable 20/X

NFTs allow for digital ownership. Like cryptocurrencies, they are stored on the blockchain, and they are proof that you own something digital. If I buy a gorgeous piece of #NFTart from @Saranahaeata, someone else can enjoy it but only I can sell it 21/X

@Saranahaeata They have been game changers for artists in particular (though NFTs can be much more than art), because unlike IRL, artists can benefit from future sales of their art in perpetuity by setting their own royalties. And this applies globally 🤯 22/X

@Saranahaeata With physical art, if an artist sells a painting for $200, gets super famous and that piece is auctioned off later for $5M, the artist usually gets nothing. With NFTs, the artist would get royalties of any future sales, baked into the "smart contract" of the original sale 23/X

@Saranahaeata So why would anyone buy an NFT? @randizuckerberg has a great video on the 3 main reasons: investment, identity & community.



Unless you're a savvy investor & spending lots of time doing research, you're likely in the other 2 categories 24/X

@Saranahaeata @randizuckerberg Personally, I've bought NFTs that either support missions/projects I'm excited about (like @CuriousAddys and @FlowerGirlsNFT) or artists whose work inspires me (like @Saranahaeata) 25/X

@Saranahaeata @randizuckerberg @CuriousAddys @FlowerGirlsNFT So what to do if you're curious to learn more, or ready to jump in and buy your first NFT?

First rule of NFTs, courtesy of @AshleyLLouise is "Do. Not. Rush."

That's the #1 way to make a mistake 26/X

@Saranahaeata @randizuckerberg @CuriousAddys @FlowerGirlsNFT @AshleyLLouise I recommend starting with some of the great resources from @CuriousAddys (including @mai_on_chain's scam quiz): curiousaddys.com/resources.

Their Discord is also a great resource (ℹ️ for people who have never used Discord, it's just like Slack. It's a chat room/community) 27/X

@Saranahaeata @randizuckerberg @CuriousAddys @FlowerGirlsNFT @AshleyLLouise @mai_on_chain And if you're still unsure about what the fuss is all about, I recommend reading @Intenex's epic piece medium.com/coinmonks/nfts… 28/X

@Saranahaeata @randizuckerberg @CuriousAddys @FlowerGirlsNFT @AshleyLLouise @mai_on_chain @Intenex I'll stop there for now! I hope many of you will reply to share other great resources you found helpful as you entered the space to pay it forward to others. 29/X

@Saranahaeata @randizuckerberg @CuriousAddys @FlowerGirlsNFT @AshleyLLouise @mai_on_chain @Intenex And please follow @meta_angels & join our Discord full of problem solvers who want to roll up their sleeves & help others: discord.gg/nYcdG2d2W7

We're an NFT membership community harnessing the metaverse to unlock real life opportunities. Mint early 2022. END 🧵

@Saranahaeata @randizuckerberg @CuriousAddys @FlowerGirlsNFT @AshleyLLouise @mai_on_chain @Intenex @meta_angels Back to the top of the thread! 📌

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