Hi, this is Klaus.
In the past, for a very long time,
when someone spoke of Bitcoins,
I’d think, "This is a scam."
I first heard about virtual currencies in 2015.
Back then, a friend’s friend lost a lot of money on Bitcoins.
At the time, a Bitcoin was US$200~300.
Then in 2017, I came across virtual currencies again
when I was a Master of Finance student.
Cryptocurrency was neither a compulsory course nor an elective.
A teacher from Singapore was invited to give two public lectures.
Although the teacher recommended buying some Bitcoins,
I ignored the advice.
At that time, a Bitcoin was $4,000.
I came across Bitcoins again last June
when a Bitcoin was nearly $70,000.
My previous landlord kicked me out, so I had to look for a new home.
He’d made a fortune by investing in virtual currencies since the pandemic started.
He was going to sell the house to buy a villa by the sea.
I had heeded the warnings of a big Vlogger on finance and invested in gold.
In the past two years since the pandemic began, the overall market value of virtual currencies has increased fivefold.
Some virtual currencies have even grown in value several hundredfold or thousandfold.
By contrast, gold, remaining around $1,800/ounce, has not outperformed inflation.
I moved to a new home in June, regained my peace of mind,
and was determined to figure out what virtual currency was all about.
Half a year later, I’m going to share what I’ve learned in today’s episode.
Before we start, let’s hear a story.
In 1929, Oil tycoon Rockefeller (some say Joe Kennedy) was having his shoes polished on a street corner.
The shoeshine boy gave him some stock tips.
This surprised him.
If even a shoe-shining kid could recommend stocks,
then the stock market must be close to a crash.
He returned to his company and immediately emptied all his stock.
Soon, the stock market depression of the 1930s took place.
This is the well-known "inverse indicator".
Similarly today,
if you were to ask middle-aged street cleaners about virtual currency,
I believe 99% of them would say that virtual currency is a scam.
If you want to be extraordinary, then you have to think outside the box.
Many ordinary folks’ biggest misunderstanding about virtual currency
is the idea that virtual currency is equal to virtual economy,
and that it is unsupported, lacks practical value, and is just pure hype.
The biggest feature of virtual currency is decentralization.
So what is centralization?
We often hear about someone "being the center"
which the Party Central Committee revolves around and is led by.
This is centralization,
which manifests itself in politics in the form of despotism and dictatorship,
and economically in the form of industry monopoly by state enterprises and giants.
What virtual currency does is decentralization.
Thus, it’s bound to be prohibited by autocracies and industry giants.
It is illegal to mine, buy or sell virtual currency in China.
In the US and Canada, most banks do not support the purchase of virtual currencies.
Even YouTube has only lifted the ban in the past two years.
Previously, videos on virtual currencies would be demonetized.
Despite great fluctuations, the overall market value of virtual currencies has been on the rise.
In other words, in theory, there must have been more winners than losers.
But most of us ordinary people are constantly told by the media
that virtual currencies are insecure and risky.
We keep hearing about someone being deceived and losing money.
Whether in China or abroad, everyone has been brainwashed to some extent.
Brainwashing is just a matter of degree.
So how do virtual currencies achieve decentralization?
If I transfer $100 to you through the bank,
the bank will take $100 from my account
and add $100 to your account.
The transaction takes place via the bank.
You can’t do anything if the bank makes a mistake or simply denies you the money.
By contrast, the virtual currency settlement system is open
and does not require a central system.
Simply put, if I transfer $100 to you, everyone can see it.
If I renege, I would have to erase everyone's memory.
In a public network that every ordinary PC can join,
we get paid for ledgering virtual currency; thus, we become miners.
These bills are packaged into blocks, which become chains in chronological order.
This is the blockchain.
Virtual currency is also a currency.
It is decentralized, highly secure, and private.
It allows fast transactions and incurs low fees.
The currency itself is a kind of technological innovation and advancement.
A new technology is bound to have negative implications.
However, the old inevitably gets replaced by the new.
Bitcoin is the first virtual currency to achieve decentralization via blockchain technology.
It is known as digital gold.
As a big Vlogger said,
“Gold has remained a safe-haven asset for thousands of years.
People have always bought gold in troubled times."
However, mankind has in the past century made scientific and technological progress
far greater than in the past millennia combined.
Human life expectancy has doubled many times in the past 100 years,
whereas it remained almost unchanged over the past few thousand years.
Gold has been a safe-haven asset for thousands of years
That's because for millennia humans haven't invented anything
that is as rare as gold, difficult to copy,
and can be stored for a long time,
until now: the digital currency has all the aforementioned qualities and more.
In troubled times, gold is bulky and not easy to carry.
Safe storage is an issue, and carrying it with you could harm your personal safety.
Digital money, however, can be stored in an online wallet or a hard drive.
You own it and no one would know. There is no such thing as “owner of digital currency”.
All you need to remember is your own password.
Bitcoin is not called “digital gold” for no reason.
On top of the decentralized encryption technology brought about by Bitcoin,
"smart contracts" are added to the blockchain.
It's open source for everyone to see.
Once formed, it is automatically executed, unmodifiable, and irreversible.
This allows virtual currency to be applied to all walks of life.
For example, if I have a building with a hundred rooms,
As opposed to an IPO, I can issue 10,000 virtual coins.
Buyers of my coins will own a part of the building.
This is called ICO, which is more open and transparent than an IPO.
The rental contracts of the rooms can be made into smart contracts on the blockchain.
After payment, your exclusive password will be automatically generated.
If you don't pay the rent when it's due, the smart housekeeper robot will kick you out.
Once my coins are in circulation, it can be exchanged with other currencies.
You can provide liquidity for currency transactions.
Smart contracts will actively match the "buyer" with the "seller".
Profits are automatically distributed to investors according to the contracts.
There is no need for banks as middlemen. This is known as Di-Fi.
These 100 rooms can also be made into NFT.
Each room becomes a unique digital asset,
publicly verifiable on the blockchain, the ownership of which unquestioned.
The NFT of the room can be turned into a virtual space of the Metaverse.
Above mentioned are some of the most popular sectors of virtual currency.
Virtual currency is the future, the main reason being that decentralization is inevitable.
The entire human society is going in the direction of democracy, freedom, equality and respect for individuality.
The number of democracies has grown from 30 a century ago
to over 100 today.
The development of democracy is itself a kind of decentralization.
In addition, as the society grows and humanity improves,
everyone is bound to be more and more aware of their privacy.
I lived in the countryside when I was a child.
Back then it was okay for 7- and 8-year-olds to run butt-naked in the village.
Such things would never happen today.
After learning about virtual currency over the past few months,
I can remove the PayPal donation link from my channel.
After all, that account has my personal information.
I can replace it with a link to a virtual currency deposit address.
In this way, my personal information is more secure.
But unfortunately, since I entered the virtual market,
due to global interest rate hikes and new COVID variants,
the market has been tanking, and even though my assets have been shrinking,
I haven’t sold them, and have had more and more coins.
Don't have a gambler mentality if you think virtual currency is the future.
Now the market is recovering, it is a good time to enter.
Buying virtual currency starts with exchanges.
Be careful when choosing a trading platform.
A few days ago, a friend contacted me,
saying he’d been defrauded of over 200,000 RMB by a supposedly hometown fellow online,
who claimed to be a master of investment and help people earn money.
He would invite you to buy coins on a certain platform. Once you’ve earned money,
you will invest more and more, and when you have invested all your assets,
the platform will suspend your account,
with all your money sealed inside.
I already know several people who’ve been defrauded on such platforms.
I know a girl who met her boyfriend online.
They also dated in reality. The boyfriend would invite her to buy coins.
In the end, over $200,000 got swallowed by a fraudulent platform.
The most practical way to choose a reliable trading platform is to look at the ranking.
Choose a top platform whose daily trading volume is preferably over a billion US dollars.
Do your own research if someone invites you to join an unknown trading platform.
Below the video are several trading platforms that I recommend.
I use them all myself. They’re beginner-friendly, and the fees are low.
You can get a discount if you use my invite link below.
There is also a relatively low-risk way to invest in virtual currencies.
Remember the ledgering services for the settlement system mentioned above?
You get paid a certain amount of virtual currency, which is commonly known as mining.
Mining has become very popular in recent years.
Investment in mining machines generally pays back in about a year.
The monthly rate of return is between 5% and 10%.
All right. If you’re interested, subscribe to my virtual currency channel.
I will share more information in the future. Now time to read your comments.
In our last video, we analyzed China's leap backwards from multiple angles.
Netizens Love & non-attack said,
“China's major achievements since the reform and opening up,
essentially, are due to the Communist Party loosening its control over the whole of society.
It's like being disturbed by your deskmate in the first semester
who stops you from concentrating in class during class time which leads to your bad grades,
whereas in the second semester, your deskmate suddenly stops disturbing you
and you become a top student as a result.
Somehow, your deskmate says that you get good grades thanks to him.”
Netizen Tearmalice said,
“Grandpa Xi asked his grandson,
‘What if I leave the farm to you, and the pigs complain about the food,
the dogs want higher wages, and the donkey hate the poor working environment?’
The grandson thought about it and said,
‘I will give the pigs better food, raise the dogs’ wages, and improve the mill environment.’
Grandpa Xi sighed, ‘Then our farm would be doomed.
You should tell them to stay inside for there are wolves outside.’”
Netizen Sasaki Akira said,
"’Our China is the most democratic country in the world. Any objections?’[
‘I object!’
Boom! ‘Well, the person who opposed democracy just now has been shot dead.
Speak your mind, everybody. Don't be afraid.’”
The following comments have a story to tell.
Netizen Diao Fei said,
“There is no such thing as ‘insulting a state leader’ in the criminal law.”
Netizen Tocix Kadea said,
“Say that in China, and I'm afraid you’ll be behind bars for a whole year.”
Diao Fei said, “I said it in a detention center.
The criminal law can be accessed on the touch screen on the cell wall, and I’ve checked it.”
Netizen Joey Cheney said,
“I insulted Xi on Zhihu, and the police came and asked me to write a guarantee only.”
Netizen Diao Fei said, “I was detained for 15 days.”
I don't know how you feel about this.
Alright, that's it for this video.
Please like, subscribe, comment and share.
This is Klaus. See you next time.