The Realistic Trader – Siam Kidd – Crypto Currencies
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Siam Kidd, aka The Realistic Trader, is a former RAF pilot turned trader and investor, whose educational work is intended as an antidote to the many get-rich-quick schemes often found in the same space.
In this interview with the Two Blokes Trading podcast, he speaks to Tom and Owen about trading’s current hot cake: Cryptocurrencies.
In the episode, Kidd is open about the reasons why he used to be against Crypto, and outlines the key reasons why he has since changed his mind and now believes that they are here to stay…
On defining Cryptocurrencies…
When I first got into this, I was confused. Because I was like, well what the hell is a Cryptocurrency? And the easiest way to say it is, “online currency”. But then that made me think, well how is it different than PayPal? With PayPal, you have a lot of intermediaries: you basically put your money onto PayPal, and then you send money to someone else’s PayPal account, but along the way there will be middlemen, i.e. banks, exchanges, and you’ll have commissions and what not.
So it wasn’t a true Internet currency, so to speak. It was just like sending it to another bank. Whereas Cryptos is a true internet currency, and really peer-to-peer. So I can send Bitcoin or any other Cryptocurrency directly to you, from my wallet into your wallet and no one else will touch it, there will be very minimal fees. That’s what a Cryptocurrency is.
Explaining Blockchain through history…
You can’t really talk about Cryptos without taking a little look at Blockchain. Blockchain is something which really confused me for a while, because in essence it’s an online “spreadsheet” so to speak: it’s a distributor ledger. If you understand Blockchain then you sort of understand Cryptos a lot easier. So the first explanation of Blockchain is the Yapese.
There’s a civilization in Micronesia called the Yapese, and for a long long time they had a money system with these things called Rai Stones. They’re huge stones with holes in the middle, and that’s what their money is. Basically whenever someone did a transaction with someone, all they are doing is swapping ownership of these stones, which are dotted around the island. So if Joe sold a pig to Bob, they’d both go “right, I now own part of this stone, do you agree?”, “yes I agree”. And then they would tell the village: “right I now own this part of the stone”. And everyone would agree. They’ve done that for thousands of years. So that is basically the world’s first Blockchain, because everyone knew about that transaction…
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