WEBVTT Kind: captions Language: en do you ever feel like everyone's talking do you ever feel like everyone's talking do you ever feel like everyone's talking about Bitcoin but nobody's explaining it about Bitcoin but nobody's explaining it about Bitcoin but nobody's explaining it clearly I've got you covered do you want clearly I've got you covered do you want clearly I've got you covered do you want to sound like the smartest person in the to sound like the smartest person in the to sound like the smartest person in the room next time someone brings up Bitcoin room next time someone brings up Bitcoin room next time someone brings up Bitcoin here are 21 terms that you need to know here are 21 terms that you need to know here are 21 terms that you need to know Bitcoin is a revolutionary technology Bitcoin is a revolutionary technology Bitcoin is a revolutionary technology the world's best money and a way to the world's best money and a way to the world's best money and a way to truly own your finances but what exactly truly own your finances but what exactly truly own your finances but what exactly is Bitcoin and how does it work I'm is Bitcoin and how does it work I'm is Bitcoin and how does it work I'm going to walk you through the 21 going to walk you through the 21 going to walk you through the 21 essential terms you need to understand essential terms you need to understand essential terms you need to understand Bitcoin the best money in the world if Bitcoin the best money in the world if Bitcoin the best money in the world if you've ever felt lost in a maze of you've ever felt lost in a maze of you've ever felt lost in a maze of Bitcoin jargon you're not alone but Bitcoin jargon you're not alone but Bitcoin jargon you're not alone but here's the Good News by the end of this here's the Good News by the end of this here's the Good News by the end of this video you'll understand bitcoin's most video you'll understand bitcoin's most video you'll understand bitcoin's most essential terms like a pro no fluff just essential terms like a pro no fluff just essential terms like a pro no fluff just the facts that you need to master this the facts that you need to master this the facts that you need to master this game-changing technology so let's start game-changing technology so let's start game-changing technology so let's start with the basics Bitcoin is a digital with the basics Bitcoin is a digital with the basics Bitcoin is a digital currency created by the pseudonymous currency created by the pseudonymous currency created by the pseudonymous Satoshi Nakamoto it's Global Satoshi Nakamoto it's Global Satoshi Nakamoto it's Global decentralized and doesn't rely on banks decentralized and doesn't rely on banks decentralized and doesn't rely on banks or governments instead it's powered by or governments instead it's powered by or governments instead it's powered by software that started recording software that started recording software that started recording transactions on January 3rd 2009 and it transactions on January 3rd 2009 and it transactions on January 3rd 2009 and it hasn't stopped since you've probably hasn't stopped since you've probably hasn't stopped since you've probably heard the buzzword blockchain before but heard the buzzword blockchain before but heard the buzzword blockchain before but what does it actually mean think of it what does it actually mean think of it what does it actually mean think of it as a public unchangeable record of every as a public unchangeable record of every as a public unchangeable record of every transaction ever made on the Bitcoin transaction ever made on the Bitcoin transaction ever made on the Bitcoin Network imagine it as a chain of digital Network imagine it as a chain of digital Network imagine it as a chain of digital receipts each one securely linked to the receipts each one securely linked to the receipts each one securely linked to the next creating a history that's nearly next creating a history that's nearly next creating a history that's nearly impossible to alter every new entry on impossible to alter every new entry on impossible to alter every new entry on the blockchain is called a block each the blockchain is called a block each the blockchain is called a block each block is a package of transactions added block is a package of transactions added block is a package of transactions added to the blockchain forming a to the blockchain forming a to the blockchain forming a chronological Ledger and a new block is chronological Ledger and a new block is chronological Ledger and a new block is created about every 10 minutes so how created about every 10 minutes so how created about every 10 minutes so how are these blocks created through a are these blocks created through a are these blocks created through a process called Bitcoin mining mining is process called Bitcoin mining mining is process called Bitcoin mining mining is the process of adding new transactions the process of adding new transactions the process of adding new transactions to the blockchain and creating new to the blockchain and creating new to the blockchain and creating new Bitcoins miners use powerful computers Bitcoins miners use powerful computers Bitcoins miners use powerful computers that perform a cryptographic hash that perform a cryptographic hash that perform a cryptographic hash function and in return they earn Bitcoin function and in return they earn Bitcoin function and in return they earn Bitcoin not only does Bitcoin mining help add not only does Bitcoin mining help add not only does Bitcoin mining help add new transactions to The Ledger it also new transactions to The Ledger it also new transactions to The Ledger it also helps secure the network you can think helps secure the network you can think helps secure the network you can think of Bitcoin as this big Treasure Chest of Bitcoin as this big Treasure Chest of Bitcoin as this big Treasure Chest that we all use and Bitcoin mining forms that we all use and Bitcoin mining forms that we all use and Bitcoin mining forms an impenetrable energy shield around it an impenetrable energy shield around it an impenetrable energy shield around it keeping everyone's funds safe from keeping everyone's funds safe from keeping everyone's funds safe from hackers a node is any computer that's hackers a node is any computer that's hackers a node is any computer that's connected to the Bitcoin Network you can connected to the Bitcoin Network you can connected to the Bitcoin Network you can imagine nodes as digital referees in the imagine nodes as digital referees in the imagine nodes as digital referees in the game verifying every transaction and game verifying every transaction and game verifying every transaction and keeping everyone honest with a copy keeping everyone honest with a copy keeping everyone honest with a copy these nodes store the entire history of these nodes store the entire history of these nodes store the entire history of Bitcoin starting from the Genesis block Bitcoin starting from the Genesis block Bitcoin starting from the Genesis block January 3r 2009 there are hundreds of January 3r 2009 there are hundreds of January 3r 2009 there are hundreds of thousands of nodes worldwide all working thousands of nodes worldwide all working thousands of nodes worldwide all working together to verify and back up The together to verify and back up The together to verify and back up The Ledger proof of work is the system that Ledger proof of work is the system that Ledger proof of work is the system that keeps Bitcoin secure it's like a keeps Bitcoin secure it's like a keeps Bitcoin secure it's like a competition where miners race to solve competition where miners race to solve competition where miners race to solve cryptographic puzzles to add new blocks cryptographic puzzles to add new blocks cryptographic puzzles to add new blocks to the blockchain miners compute to the blockchain miners compute to the blockchain miners compute cryptographic hash functions which cryptographic hash functions which cryptographic hash functions which require pure guesswork and a lot of require pure guesswork and a lot of require pure guesswork and a lot of electricity to perform the discovery of electricity to perform the discovery of electricity to perform the discovery of the correct hash by these computers the correct hash by these computers the correct hash by these computers proves that they've done the physical proves that they've done the physical proves that they've done the physical work this process protects the network work this process protects the network work this process protects the network from tampering transforming real world from tampering transforming real world from tampering transforming real world energy into organized computing power energy into organized computing power energy into organized computing power the power of miners is measured by their the power of miners is measured by their the power of miners is measured by their hash rate basically how many guesses hash rate basically how many guesses hash rate basically how many guesses their computers can make per second to their computers can make per second to their computers can make per second to solve the puzzle the higher the hash solve the puzzle the higher the hash solve the puzzle the higher the hash rate on the network the more secure the rate on the network the more secure the rate on the network the more secure the network is and in terms of the machine network is and in terms of the machine network is and in terms of the machine the higher the hash rate the greater the higher the hash rate the greater the higher the hash rate the greater chance that your machine will make the chance that your machine will make the chance that your machine will make the right guess that leads to a block right guess that leads to a block right guess that leads to a block forming and getting the reward if you forming and getting the reward if you forming and getting the reward if you own Bitcoin then you've got a private own Bitcoin then you've got a private own Bitcoin then you've got a private key which is like your personal password key which is like your personal password key which is like your personal password to access your Bitcoin if someone steals to access your Bitcoin if someone steals to access your Bitcoin if someone steals your private key they can steal your your private key they can steal your your private key they can steal your Bitcoin so keep it safe and don't share Bitcoin so keep it safe and don't share Bitcoin so keep it safe and don't share it with anyone when people want to take it with anyone when people want to take it with anyone when people want to take custody of their own Bitcoin offline custody of their own Bitcoin offline custody of their own Bitcoin offline away from potential hackers they use a away from potential hackers they use a away from potential hackers they use a signing device also known as taking your signing device also known as taking your signing device also known as taking your money into Cold Storage the point is money into Cold Storage the point is money into Cold Storage the point is that no internet connected device should that no internet connected device should that no internet connected device should ever have your private key information ever have your private key information ever have your private key information because if it did then it's possible because if it did then it's possible because if it did then it's possible that an online hacker can steal your that an online hacker can steal your that an online hacker can steal your private key and steal your for Bitcoin private key and steal your for Bitcoin private key and steal your for Bitcoin therefore having an offline device that therefore having an offline device that therefore having an offline device that stores your private key and signs your stores your private key and signs your stores your private key and signs your Bitcoin transactions keeps your funds Bitcoin transactions keeps your funds Bitcoin transactions keeps your funds safe no internet connection means that safe no internet connection means that safe no internet connection means that it's almost impossible for it to be it's almost impossible for it to be it's almost impossible for it to be stolen next is a seed phrase this is stolen next is a seed phrase this is stolen next is a seed phrase this is like your master password that unlocks like your master password that unlocks like your master password that unlocks access to your Bitcoin you'll see it as access to your Bitcoin you'll see it as access to your Bitcoin you'll see it as 12 or 24 random words so write it down 12 or 24 random words so write it down 12 or 24 random words so write it down and protect it like your life savings and protect it like your life savings and protect it like your life savings depend on it because they do this is the depend on it because they do this is the depend on it because they do this is the seed that produces your public private seed that produces your public private seed that produces your public private key pair and because the private key key pair and because the private key key pair and because the private key comes from the seed phrase it is equally comes from the seed phrase it is equally comes from the seed phrase it is equally as important to protect in fact most as important to protect in fact most as important to protect in fact most people are never really exposed to their people are never really exposed to their people are never really exposed to their actual private key rather they record actual private key rather they record actual private key rather they record these 12 or 24 words on a piece of paper these 12 or 24 words on a piece of paper these 12 or 24 words on a piece of paper or stamped in metal keeping these words or stamped in metal keeping these words or stamped in metal keeping these words secure and secret is of the utmost secure and secret is of the utmost secure and secret is of the utmost importance to keeping your Bitcoin safe importance to keeping your Bitcoin safe importance to keeping your Bitcoin safe your Bitcoin address is like your public your Bitcoin address is like your public your Bitcoin address is like your public facing account number it's the string of facing account number it's the string of facing account number it's the string of letters and numbers that you share with letters and numbers that you share with letters and numbers that you share with others to receive Bitcoin but don't others to receive Bitcoin but don't others to receive Bitcoin but don't worry that doesn't Reveal Your private worry that doesn't Reveal Your private worry that doesn't Reveal Your private key it's best to never reuse a Bitcoin key it's best to never reuse a Bitcoin key it's best to never reuse a Bitcoin address more than once for privacy address more than once for privacy address more than once for privacy purposes xpub stands for extended public purposes xpub stands for extended public purposes xpub stands for extended public key this is the public key that key this is the public key that key this is the public key that generates all of the children Bitcoin generates all of the children Bitcoin generates all of the children Bitcoin addresses this is what you provide addresses this is what you provide addresses this is what you provide wallet software so that you can view wallet software so that you can view wallet software so that you can view your balance in an app this leads us to your balance in an app this leads us to your balance in an app this leads us to the term Bitcoin wallet a wallet the term Bitcoin wallet a wallet the term Bitcoin wallet a wallet software is an app that acts like a software is an app that acts like a software is an app that acts like a window into the Bitcoin blockchain to window into the Bitcoin blockchain to window into the Bitcoin blockchain to give you an overview of your Bitcoin give you an overview of your Bitcoin give you an overview of your Bitcoin balance and your transaction history balance and your transaction history balance and your transaction history this is also the app that communicates this is also the app that communicates this is also the app that communicates with the network when when you want to with the network when when you want to with the network when when you want to sign a transaction and broadcast that sign a transaction and broadcast that sign a transaction and broadcast that transaction once it's been signed with transaction once it's been signed with transaction once it's been signed with your signing device hot wallets are your signing device hot wallets are your signing device hot wallets are Bitcoin wallets that are connected to Bitcoin wallets that are connected to Bitcoin wallets that are connected to the internet these are less secure the internet these are less secure the internet these are less secure because your private key is saved on an because your private key is saved on an because your private key is saved on an app that is connected to the internet app that is connected to the internet app that is connected to the internet these are easy to use but should only these are easy to use but should only these are easy to use but should only contain a small amount of Bitcoin given contain a small amount of Bitcoin given contain a small amount of Bitcoin given their security risks if you want more their security risks if you want more their security risks if you want more security multi- signature custody security multi- signature custody security multi- signature custody requires multiple private keys to access requires multiple private keys to access requires multiple private keys to access your Bitcoin it's like needing two keys your Bitcoin it's like needing two keys your Bitcoin it's like needing two keys to open a vault making it extra secure to open a vault making it extra secure to open a vault making it extra secure for large balances this is great for for large balances this is great for for large balances this is great for businesses or anybody storing large businesses or anybody storing large businesses or anybody storing large amounts of Bitcoin and it greatly amounts of Bitcoin and it greatly amounts of Bitcoin and it greatly reduces the risk of physical theft of reduces the risk of physical theft of reduces the risk of physical theft of your your your Bitcoin the lightning network is a Bitcoin the lightning network is a Bitcoin the lightning network is a second layer that makes Bitcoin second layer that makes Bitcoin second layer that makes Bitcoin transactions faster and cheaper instead transactions faster and cheaper instead transactions faster and cheaper instead of processing it on the main blockchain of processing it on the main blockchain of processing it on the main blockchain or the base layer it handles or the base layer it handles or the base layer it handles transactions offchain and settles them transactions offchain and settles them transactions offchain and settles them later typically this comes in the form later typically this comes in the form later typically this comes in the form of an app on your phone and makes of an app on your phone and makes of an app on your phone and makes Bitcoin transactions incred simple fast Bitcoin transactions incred simple fast Bitcoin transactions incred simple fast and cheap and it's like using the and cheap and it's like using the and cheap and it's like using the Express checkout lane instead of Express checkout lane instead of Express checkout lane instead of standing in a long line when you send standing in a long line when you send standing in a long line when you send Bitcoin it waits in the M Pool until the Bitcoin it waits in the M Pool until the Bitcoin it waits in the M Pool until the miners put it in a block you can think miners put it in a block you can think miners put it in a block you can think of this as a waiting room for your of this as a waiting room for your of this as a waiting room for your transactions to make sure that miners transactions to make sure that miners transactions to make sure that miners pick up your transaction faster you can pick up your transaction faster you can pick up your transaction faster you can pay transaction fees these transaction pay transaction fees these transaction pay transaction fees these transaction fees incentivize miners to process your fees incentivize miners to process your fees incentivize miners to process your transaction first if you set them higher transaction first if you set them higher transaction first if you set them higher the higher the fee the sooner the miners the higher the fee the sooner the miners the higher the fee the sooner the miners will process your transaction and will process your transaction and will process your transaction and transaction fees contribute to the transaction fees contribute to the transaction fees contribute to the Bitcoin reward that miners receive for Bitcoin reward that miners receive for Bitcoin reward that miners receive for their services every 4 years Bitcoin their services every 4 years Bitcoin their services every 4 years Bitcoin experiences a having where the reward experiences a having where the reward experiences a having where the reward for miners is cut in half this process for miners is cut in half this process for miners is cut in half this process creates scarcity and is a reason that creates scarcity and is a reason that creates scarcity and is a reason that Bitcoin is often compared to gold in Bitcoin is often compared to gold in Bitcoin is often compared to gold in 2009 each block rewarded a minor 50 new 2009 each block rewarded a minor 50 new 2009 each block rewarded a minor 50 new Bitcoin per block 4 years later that Bitcoin per block 4 years later that Bitcoin per block 4 years later that block reward was reduced to 25 Bitcoin block reward was reduced to 25 Bitcoin block reward was reduced to 25 Bitcoin and today that reward is at 3.125 and today that reward is at 3.125 and today that reward is at 3.125 Bitcoin until the year 2028 having are Bitcoin until the year 2028 having are Bitcoin until the year 2028 having are going to continue until until the year going to continue until until the year going to continue until until the year 2140 where no new Bitcoin will be 2140 where no new Bitcoin will be 2140 where no new Bitcoin will be created a Bitcoin exchange is a platform created a Bitcoin exchange is a platform created a Bitcoin exchange is a platform where you can buy or sell Bitcoin here where you can buy or sell Bitcoin here where you can buy or sell Bitcoin here people will exchange fiat currency like people will exchange fiat currency like people will exchange fiat currency like dollars for Bitcoin and finally we have dollars for Bitcoin and finally we have dollars for Bitcoin and finally we have SATs which is short for Satoshi they're SATs which is short for Satoshi they're SATs which is short for Satoshi they're the smallest unit of Bitcoin just like a the smallest unit of Bitcoin just like a the smallest unit of Bitcoin just like a dollar has cents a Bitcoin has Satoshi dollar has cents a Bitcoin has Satoshi dollar has cents a Bitcoin has Satoshi and one Bitcoin equals 100 million sets and one Bitcoin equals 100 million sets and one Bitcoin equals 100 million sets now you're ready to speak the language now you're ready to speak the language now you're ready to speak the language of Bitcoin from nodes to SATs you've got of Bitcoin from nodes to SATs you've got of Bitcoin from nodes to SATs you've got the knowledge to navigate this the knowledge to navigate this the knowledge to navigate this revolutionary world so which term was revolutionary world so which term was revolutionary world so which term was new to you drop it in the comments and new to you drop it in the comments and new to you drop it in the comments and let's see how far you've come