Crypto Basics — NEWBEE School

IN THIS TOPIC

01 · What is cryptocurrency?02 · What problem does Bitcoin try to solve?03 · What is Ethereum?04 · What is a blockchain?05 · Coins vs tokens 06 · Circulating supply vs total supply 07 · Market cap and FDV 08 · How consensus works 09 · Nodes, validators and miners 10 · Your first crypto rule

LESSON 01

What is cryptocurrency?

Crypto is a broad term for digital assets and the networks that let people store, transfer or use them with cryptographic authorization. A blockchain is one common way to record ownership and transactions.

MENTAL MODEL / EXAMPLE
Mental model: digital value + a shared network + rules. A token is not automatically valuable or safe just because it exists.

CHECK YOURSELFBeginner check: Can you explain what asset you are holding and which network it lives on?

LESSON 02

What problem does Bitcoin try to solve?

Bitcoin was designed as a peer-to-peer electronic cash system that can operate without a central settlement authority. Its monetary policy and network rules are enforced by software and consensus.

MENTAL MODEL / EXAMPLE
Bitcoin combines a native asset, a public ledger, and Proof-of-Work security.

CHECK YOURSELFDo not confuse a fixed-supply narrative with a guaranteed price outcome.

LESSON 03

What is Ethereum?

Ethereum is a general-purpose blockchain that supports a native asset, ETH, plus programmable smart contracts and decentralized applications.

MENTAL MODEL / EXAMPLE
Think of Bitcoin as a specialized monetary network and Ethereum as a programmable settlement platform.

CHECK YOURSELFDifferent chains have different execution, fee and security models.

LESSON 04

What is a blockchain?

A blockchain is a replicated record of transactions or state changes maintained by a network. Blocks link together using cryptographic techniques and consensus rules.

MENTAL MODEL / EXAMPLE
Imagine many computers maintaining compatible copies of a shared notebook.

CHECK YOURSELFPublic does not mean correct: users still need to verify contracts, addresses and claims.

LESSON 05

Coins vs tokens

A coin is normally the native asset of its own blockchain, such as BTC on Bitcoin or ETH on Ethereum. A token is commonly created by a smart contract on an existing chain.

MENTAL MODEL / EXAMPLE
An ERC-20 token can use ETH for Ethereum network fees even though the token is a separate asset.

CHECK YOURSELFAlways verify the token contract address; names and symbols can be copied.

LESSON 06

Circulating supply vs total supply

Circulating supply describes units considered in public circulation. Total supply describes the broader issued amount under the project’s rules. Different data providers can define these metrics differently.

MENTAL MODEL / EXAMPLE
A token can have a small circulating supply but a much larger future allocation.

CHECK YOURSELFRead the actual token contract and published allocation rules instead of trusting a graphic.

LESSON 07

Market cap and FDV

Market cap is commonly price multiplied by circulating supply. Fully diluted valuation, or FDV, commonly uses a larger supply figure such as maximum or total supply. Neither number equals cash available to sell.

MENTAL MODEL / EXAMPLE
Low liquidity can make a market-cap headline very different from the amount that could actually be exited.

CHECK YOURSELFPrice × supply is a metric, not a guarantee of liquidity or future value.

LESSON 08

How consensus works

Consensus is the mechanism a network uses to agree on valid state changes. Proof of Work and Proof of Stake are two major approaches with different trade-offs.

MENTAL MODEL / EXAMPLE
Consensus is a technical and economic system, not simply a popularity vote.

CHECK YOURSELFLearn the chain’s security model before assuming another chain behaves the same way.

LESSON 09

Nodes, validators and miners

Nodes participate in a network by receiving, validating, relaying or storing blockchain data. In some systems, validators propose or attest to blocks; in Proof-of-Work systems, miners compete using computation.

MENTAL MODEL / EXAMPLE
Different networks use different roles and terminology.

CHECK YOURSELFNever assume “validator” means every chain has the same security model.

LESSON 10

Your first crypto rule

The first skill is not picking a coin. It is learning to identify the asset, chain, custody model, contract, supply, liquidity and risks.

MENTAL MODEL / EXAMPLE
If you cannot explain what you own in two sentences, keep learning before committing money.

CHECK YOURSELFNEWBEE rule: Learn → Verify → Protect.

NEWBEE RULE

Learn → Verify → Protect.

Before moving money, connecting a wallet, trusting a claim or signing a transaction, slow down. Identify the exact asset, network, contract, source, permissions and risks.

Crypto BasicsBeginnerSecurityVerification

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