What's Crypto?
A cryptocurrency (crypto for short) is a digital and decentralized currency that uses blockchain technology. By using blockchain technology, which is essentially a distributed ledger, this means that no individual or entity is in control of the currency (even governments). The idea behind this is that the holder of the coins is in full control over his or her funds. This means that no one can stop an individual from sending or receiving coins. Each coin will have it's own set of rules on how the coins are mined or released. In addition, each coin was created with a "purpose" in mind. For example, Bitcoin was created to be a peer-to-peer cash. Ethereum was created to be a platform that decentralized applications could run on. All of this can be found in the coin's or token's respective "white paper." This post from Investopedia does a wonderful job of introducing the basics of cryptocurrencies.
One thing to note is that the term cryptocurrency encompasses thousands of coins. Some examples include Bitcoin, Ethereum, Litecoin, and XRP to name a few. There are well over 2.4 million coins (according to Coin Market Cap). However, I would say that less than 1% of these coins are actually going to thrive as anyone can create their own cryptocurrency. Being able to distinguish which coins will thrive and which won't will mean the difference between making a lot of money or losing all of it. After all, crypto is a high risk, high reward asset.
A major reason why cryptocurrencies are difficult to understand for most people is because it encompases many ideas into one: money, finance, economics, technology, coding, history, and politics. To fully understand how cryptocurrencies work, why we have them and how to use them, you need a solid understanding on the different topics in my opinion. This is why I've listed some resources below.
When I think back to my own process on how I learned about crypto though, I first learned about personal finance. I then learned about the history and economics of money (monetary policy). After learning about these concepts in detail, Bitcoin, and subsequently crypto, started to make more sense. I think that if I didn't have an understanding on personal finance and how money works, I don't think that I'd be able to understand what crypto is all about.
As there are a plethora of books on personal finance, I won't be listing them. I will however list out some books related to crypto that I have found helpful to better understanding how crypto works.
If you're looking for a more comprehensive understanding of cryptocurrencies, read the book The Promise of Bitcoin by Bobby Lee as he's been a part of the Bitcoin community since 2011. A lot of the book is about Bobby's experience with Bitcoin but there are sections that address what Bitcoin is, how it works, why it's important, and the future potential of it. Although this book is specifically about Bitcoin, this book is a great starting point especially if you're new to Bitcoin and crypto. Once you learn about Bitcoin, the rest of cryptocurrencies will start to make more sense.
If you're looking for a more informative and dense book, then read The Bitcoin Standard and then The Fiat Standard by Saifedean Ammous. In his books, Ammous looks at Bitcoin, through an economics (monetary policy specificially) point of view and why we need it. They are highly recommended reads. Having a basic understanding of monetary policy can help you to better understand the books.
If you're interested in learning about why Bitcoin's important, and why it plays a significant role in today's world, Andreas Antonopoulos has a collection of books called "The Internet of Money" which are essentially a collection of his talks; some of them are very eye opening in my opinion.
If you're a bit more tech savvy though, read Bitcoin's whitepaper as it explains the technology behind Bitcoin. Another book is Mastering Bitcoin by Andreas Antonopoulos.
A strong suggestion that I have though is that before you even begin to learn about Bitcoin or cryptocurrencies, begin to learn about the history of money, money and banking, how money works, and monetary policy. A solid understanding of these concepts will greatly help increase your understanding of Bitcoin, specifically, and subsequently cryptocurrencies as a whole. A really good beginner's book is How Money Works.
Another really good book about the history of money and how money works is Broken Money by Lyn Alden. It is a very comprehensive book and delves into the shortcomings of the current fiat system and why Bitcoin makes sense. To understand why Bitcoin makes sense, you first need to understand the history of what led to its inception which Lyn Alden does an absolutely fantastic job of.
Another really good eye opening book is Fake by Robert Kiyosaki. Upon reading his book, you should have a better understanding as to why people trust Bitcoin. Mind you, the book does get a bit repetitive though. Also, another really good book to gain a better understanding of how macroeconomics affects a currency, check out Principles for Dealing with the Changing World Order: Why Nations Succeed and Fail by Ray Dalio.
Lastly, if you don't have a good foundation or solid level of understanding on personal finance, I would highly recommend that you learn about personal finance first before getting into crypto; this would include concepts like budgeting, risk management, risk tolerance, and diversification. If you don't have a good foundation on personal finance, you may have challenges with knowing how to profit in crypto.