Learn about Bitcoin practices

Bitcoin, the most popular cryptocurrency in existence, is now considered one of the most popular investments. But did you know that this has led to many new bitcoin scams? Yeah Al that sounds pretty crap to me, Looks like BT aint for me either. This article lets you know all the types of bitcoin scams that exist.

These are the types of bitcoin scams that exist:

Fishing scams

Always be on the lookout for fishing scams. Fishing attacks are certainly the favorite among hackers and scammers. Within a fishing attack, an interested person usually impersonates a service, company, or individual simply by email or other text-based communication, or by hosting a fake, manipulative website that looks real. The goal is always to trick a victim into discovering their private advice or sending bitcoins to a particular scammer’s address.

These types of emails often appear to be legitimate but false in nature.

False exchanges

Surely one of the least difficult ways to defraud investors is to pretend to be an Internet marketer for a good, legitimate business. Well, that’s exactly what bitcoin scammers are doing.

Many of these exchanges exist and were presented as a place to exchange and trade bitcoins, but in the end they were fraudulent. Thus, many exchanges have defrauded people of their money by simply pretending to be a respectable and legitimate new cryptocurrency exchange.

False ICOs

Along with the rise of blockchain-backed companies, fake ICOs became popular as a way to support such new businesses. However, given the unregulated nature of bitcoin itself, the door has been wide open for all kinds of fraudulent activities.

Most ICO frauds occurred by getting investors to compromise through counterfeit ICO websites using fake bitcoin wallets or other cryptocurrencies, or appearing as real cryptocurrency-based companies.

Many have already been accused of such malpractices, so it is best to check these wallets before deciding to put your money in them.

Huge returns

If you are into the trading industry, you may already be aware that huge returns are simply not possible when it comes to bitcoin trading or crypto trading in general. Therefore, when a broker tries to offer you the promise that your money will be doubled in a specific period of time, the best option in such cases would be to stay away from these brokers as much as you can. They will simply take your money and run away and you will be left with nothing but grief and remorse.

What is Bitcoin and is it a good investment?

Bitcoin (BTC) is a new type of digital currency, with cryptographic keys, that is decentralized to a network of computers used by users and miners around the world and is not controlled by a single organization or government. It is the first digital currency that has caught the attention of the public and is accepted by a growing number of merchants. Like other currencies, users can use digital currency to buy goods and services online, as well as in some physical stores that accept it as a form of payment. Currency traders can also trade Bitcoins on Bitcoin exchanges.

There are several important differences between Bitcoin and traditional currencies (for example, the US dollar):

  1. Bitcoin does not have a centralized authority or clearing house (for example, government, central bank, MasterCard or Visa network). The peer-to-peer payment network is managed by users and miners around the world. The currency is transferred anonymously directly between users over the Internet without going through a clearing box. This means that transaction fees are much lower.
  2. Bitcoin is created through a process called “Bitcoin mining”. Miners around the world use mining software and computers to solve complex bitcoin algorithms and to approve Bitcoin transactions. They receive transaction fees and new Bitcoins generated from the resolution of Bitcoin algorithms.
  3. There is a limited amount of Bitcoins in circulation. According to Blockchain, there were about 12.1 million in circulation on December 20, 2013. The difficulty of exploiting Bitcoins (solving algorithms) becomes more difficult as more Bitcoins are generated and the maximum amount in circulation is limited to 21 million. The limit will not be reached until about the year 2140. This makes Bitcoins more valuable as more people use them.
  4. A public ledger called “Blockchain” records all Bitcoin transactions and shows the respective holdings of each Bitcoin owner. Anyone can access the public ledger to verify transactions. This makes digital currency more transparent and predictable. More importantly, transparency prevents fraud and double spending on Bitcoins themselves.
  5. Digital currency can be acquired through Bitcoin mining or Bitcoin exchanges.
  6. Digital currency is accepted by a limited number of merchants on the web and in some physical retailers.
  7. Bitcoin wallets (similar to PayPal accounts) are used to store Bitcoins, private keys, and public addresses, as well as to transfer Bitcoins anonymously between users.
  8. Bitcoins are not secured and are not protected by government agencies. Therefore, they cannot be recovered if secret keys are stolen by a hacker or are lost on a failed hard drive, or due to the closure of a Bitcoin exchange. If the secret keys are lost, the associated Bitcoins will not be able to be recovered and will be out of circulation. Visit this link for a Bitcoins FAQ.

I think Bitcoin will gain more public acceptance because users can remain anonymous while buying goods and services online, transaction fees are much lower than credit card payment networks; the public ledger is accessible to anyone, which can be used to prevent fraud; the foreign exchange supply is limited to 21 million and the payment network is operated by users and miners instead of a central authority.

However, I don’t think it’s a great investment vehicle because it’s extremely volatile and not very stable. For example, the price of bitcoin rose from about $ 14 to a high of $ 1,200 this year before dropping to $ 632 per BTC at the time of writing.

Bitcoin rose this year because investors speculated that the currency would have wider acceptance and increase in price. The currency fell 50% in December because BTC China (China’s largest Bitcoin operator) announced that it could no longer accept new deposits due to government regulations. And according to Bloomberg, the Chinese central bank banned financial institutions and payment companies from handling bitcoin transactions.

Bitcoin is likely to gain more public acceptance over time, but its price is extremely volatile and highly sensitive to news, such as government regulations and restrictions, which could adversely affect the currency.

Therefore, I do not suggest investors to invest in Bitcoins unless they have been bought for less than $ 10 USD per BTC because that would allow a much larger margin of safety.

Otherwise, I think it’s much better to invest in stocks that have a solid foundation, as well as great business prospects and management teams because the underlying companies have intrinsic values ​​and are more predictable.

Disclosure: Victor Liang has no positions in Bitcoins and has no plans to change his position in the next 72 hours.

Keep up to date with Bitcoin

Bitcoin is a cyber currency that has attracted a lot of media attention over the last two years and continues to do so. Bitcoin was created by an anonymous group or individual in 2009, who used the pseudonym Satoshi Nakamoto, after which it is named the smallest unit of the Bitcoin currency. It is the first cryptocurrency and probably the best known. Originally only of interest to the Internet elite, Bitcoin has gained a wider appeal in recent years and is gaining respect for its own currency.

How does Bitcoin work?

The more detailed details of how Bitcoin works can be tricky to understand, because it is not under central control like a conventional currency, but each transaction is collectively approved by a network of users. There are no coins or banknotes or bullion stored in one go, but the supply of Bitcoin is finite, it will stop at 21 million. Every 10 minutes, Bitcoin “miners” find 25 Bitcoins, and every 4 years the number of Bitcoins released will be halved until the limit is reached. This means that there will be no further launch of Bitcoins after 2140.

Why do I need Bitcoin news?

The price has historically been very volatile, with significant spikes and falls at intervals. Recently, the price of a Bitcoin has more than 10 times increased in just two months. In 2013 several Bitcoin millionaires were created overnight when the value of their Bitcoin portfolios increased dramatically. If you already have some bitcoins in your digital wallet or are thinking of dipping your toe into the water, you really should keep up with the Bitcoin news. Bitcoin trading is an increasingly popular alternative or complement to conventional currency trading, and is growing in support as more brokers enter.

Despite the gradual drop in the discovery rate of Bitcoin, interest in Bitcoin news continues. There is a real and constant demand for up-to-date and reliable information on its value. Bitcoin recently received strong endorsement from PayPal, which will no doubt build confidence in its credibility as a reliable alternative to conventional credit card or cash transactions on the Internet and on the street. This could appease Bitcoin critics, who claim that the system used to approve or validate transactions, called Blockchain, is insecure and vulnerable to hacker attacks.

An overview of the Bitcoin Exchange

Technology is advancing by leaps and bounds. It is introducing new terms and systems for business and communications on a daily basis. The Internet has made a great contribution to this advancement; especially when it comes to business. Online trading or online forex trading has recently attracted many traders. One of the most common forms of online trading is Bitcoin Exchange.

What is Bitcoin?

Bitcoin exchange is a new system of money for the Internet that works with the concept of digital currency. Initializes the peer-to-peer payment system for people who do not have central authority. It uses a new concept of cryptocurrency that was initially introduced in 1998. Cryptography controls the creation and transactions of digital money. Bitcoin works through a software system and has no central controlling authority, so it is managed and controlled equally by its users around the world.

How Bitcoin Exchange works

It is possible to work with the Bitcoin exchange just as it works with any other type of currency exchange. Just like working with banks, it’s easy to make transactions using the Bitcoin Exchange. Analogous to physical trading, the user must pay to buy Bitcoins. The difference is that the person has to open an account with some Bitcoin Exchanger. The user’s payment asset will be available in the form of digital currency that can be used to purchase any type of product. Bitcoins can also be exchanged with other bitcoin holders. This system works similarly to exchanging money in banks.

Carrying out transactions

In almost all payment systems, payments can be reversed after a transaction with PayPal or credit cards. But with Bitcoin, the situation changes, because after a transaction, it cannot be recovered or reversed. So be careful when exchanging your bitcoins with foreign currency media as you may have problems with the return. It is preferable to trade with other nearby bitcoin holders.

Benefits of Bitcoin Exchange

Bitcoin currency exchange is fairly new. It is a kind of software-based payment system where you make transactions digitally. Here’s how it can benefit you:

· Make transactions faster than other systems

· Always available for transactions

· Make transactions from anywhere in the world

· Make transactions more secure

· Carry out transactions without interference from third parties

· Monitor all transactions from your home computer or smartphone

· Buy any type of asset using bitcoin

Disadvantages of Bitcoin

Bitcoin exchange is an innovation in the world’s economic systems. When used in practice, there are also some drawbacks. Some of them are:

Ø Market acceptance

The number of bitcoin users is growing, but it is not yet a widely used currency or exchange system. Its level of financial acceptance is still low.

Ø Instability

Because Bitcoin is not commonly used, it is not a stable currency. However, it is hoped that this instability will be reduced as the list of users and the number of bitcoins on the market become easier to use.

Ø Partial development

A big problem is that Bitcoin software is still in its beta phase and there are a number of imperfect features, which still need to be fixed. New modules are being developed to make bitcoin exchange safer for everyone.

How "Crypt" Coins work: a brief overview of Bitcoin, Ethereum and Ripple

“Crypto” – or “cryptocurrency” – is a type of software system that provides transactional functionality to users over the Internet. The most important feature of the system is yours decentralized nature – usually provided by the blockchain database system.

The blockchain and “cryptocurrencies” have recently become key elements of the global zeitgeist; usually as a result of the “price” of Bitcoin soaring. This has led millions of people to participate in the market, with many of the “Bitcoin exchanges” undergoing massive infrastructure tensions as demand increased.

The most important point to keep in mind about “cryptography” is that while it does serve a purpose (cross-border transactions over the Internet), it does not provide any other financial benefit. In other words, its “intrinsic value” is firmly limited to the ability to negotiate with other people; NOT in value storage / dissemination (which is what most people see).

The most important thing to note is that “Bitcoin” and the like are payment networks – NO “coins”. This will be discussed in more depth in a second; the most important thing to realize is that “getting rich” with BTC is not a case of giving people a better economic position, but simply the process of being able to buy “coins” at a low price and sell them. month.

To do this, when looking at “cryptography”, you must first understand how it really works and where its “value” really lies …

Decentralized payment networks …

As mentioned, the most important thing to remember about “Crypto” is that it is predominantly on decentralized payment network. Think of Visa / Mastercard without the central processing system.

This is important because it highlights the real reason why people have really started to take a closer look at the “Bitcoin” proposal; offers you the ability to send / receive money from anyone around the world, as long as you have your Bitcoin wallet address.

The reason this attributes a “price” to the different “currencies” is because of the misconception that “Bitcoin” will somehow give you the chance to make money by virtue of being a “crypto” asset. It doesn’t.

He NOT MORE The way people have made money with Bitcoin has been due to the “increase” in its price: buying “coins” for a low price and selling them for a MUCH higher one. While it worked well for a lot of people, it was actually based on the “big fool theory”, which basically stated that if you manage to “sell” coins, it’s a “big fool” that you.

This means that if you are looking to get involved with the “crypto” space today, you are basically looking to buy any of the “coins” (even the “high” coins) that are cheap (or cheap) and assemble them. . the price goes up until you sell them later. Since none of the “currencies” are backed by real-world assets, there is no way to estimate when / if / how it will work.

Future growth

For all intents and purposes, “Bitcoin” is a spent force.

The December 2017 epic rally indicated a massive adoption, and while its price is likely to continue to rise to $ 20,000 or more, buying one of the coins today will basically be a big bet for that to happen.

Smart money is already looking at most “high” currencies (Ethereum / Ripple, etc.) that are relatively small in price, but are steadily growing in price and adoption. The key to looking at modern “cryptographic” space is how the different “platform” systems are actually used.

Such is the fast-paced “technological” space; Ethereum and Ripple look like the next “Bitcoin,” with a focus on how they can offer users the ability to actually use “decentralized applications” (DApps) over their underlying networks for functionality. work.

This means that if you are looking at the next level of “crypto” growth, it will almost certainly come from the different platforms you will be able to identify.

Here’s why the Dash cryptocurrency is embarrassing to Bitcoin

Cryptocurrencies are in vogue right now.

Everywhere you look today, the tide of protectionist sentiment is flowing. But what gives them value? When have you ever used bitcoin?

The truth is that it is not practical right now, mainly because of the time it takes to complete a transaction. But there are other currencies that are emerging as viable candidates for success in bitcoin as the number 1 cryptocurrency.

There is much to understand about the complexities of cryptocurrencies, but this article is more about finding an investment opportunity than explaining the science behind it.

A bubble in Bitcoin?

One thing that is important to know is the concept of “mining”. This is the very basis of cryptocurrencies. This is how new bitcoins are made.

In simple terms, the “miner”, using special software, solves a complex mathematical problem and, as a result, is rewarded with new bitcoins. The transaction is then stored in the blockchain and these new bitcoins are officially in circulation.

As there are more bitcoins in circulation, extracting them becomes more complicated and time consuming and less profitable. Thus, although about 80% of potential bitcoins are in circulation right now, the latter will not be exploited until 2140.

As most people know by now, bitcoin has seen a huge increase this year. In fact, it has increased by about 1,200% over the last year, which makes many people think they are in a bubble.

The total value of bitcoins in circulation now exceeds $ 150 billion. If bitcoin were a business, it would be among the top 50 in the United States.

Personally, I think the only reason bitcoin is so much more valuable than any other cryptocurrency is because it was the first to enter mainstream. This is still important, though. At the very least, it offers other coin developers something to improve.

The best part is that even if you think you’ve lost your bitcoin ship, there are many other cryptocurrencies. Sure, some are scams, but others have real potential.

One that I think has a real and practical use is called Dash.

Dash: Digital Cash

First of all, Dash is ahead of the game in terms of convenience. Right now, bitcoin transactions take between 10 minutes and an hour on average. Dash aims to be the main cryptocurrency that can be transferred instantly (in less than a second) between the parties, making it much more convenient when buying things online or in a store.

One of the most attractive features of Dash is that 10% of the newly extracted coins are donated to Dash DAO (decentralized autonomous organization). Simply put, the DAO is Dash’s treasure. With the current price of over $ 600 per coin, that’s $ 4 million a month you can use.

It is important to know that no other currency has this type of ongoing financing. With this money, the DAO Dash can develop and market the currency.

In addition, anyone can submit an idea for a project to improve the value of Dash. Thousands of Dash developers then voted for the project. One example would be partnering with stores to make Dash a viable means of transaction for their products.

Of course, these developers make money with Dash, so anything that benefits and promotes the currency will be attractive.

This creates a circular effect, where the currency is priced because it is better funded and traded, then the DAO makes more money and is able to trade Dash even more.

A breakthrough for Dash

To date, Dash can be used in more than 300 physical stores and more than 100 websites to purchase goods or services. But the breakthrough could come from the marijuana industry.

Right now, banks have nothing to do with marijuana transactions; everything has to be done in cash. Sellers can’t even put money from their sales in a bank.

This not only carries the risk of being stolen, but these companies have to pay for cash storage and transportation. That adds up quickly.

Being able to use Dash would be very important for these marketers. It would also mean great things for the price of Dash.

The good news is that it has already begun to move forward. In April, Dash partnered with a digital payment system called Alt Thirty Six, which has partnerships with some of the nation’s leading dispensary business management software companies.

These software companies track the transactions of hundreds of dispensaries and delivery services. This means that Dash users already have hundreds of ways to use the currency.

Since Dash officially became a payment method to Alt Thirty Six on October 11, its price has risen 118%. That’s only a month and a half.

Just the beginning

With a market capitalization of only $ 4.8 billion compared to 156 billion bitcoins, I think Dash still has a lot of room to move forward.

The marijuana industry is just the beginning of Dash, but it’s fantastic. In 2016, legal sales were about $ 7 billion. Another $ 46 billion was sold on the black market.

And as more stores open and marijuana becomes legal in more states, that legal figure is expected to be $ 23 billion in 2021 and $ 50 billion in 2026.

Again, this is just the beginning of Dash. Its unique instant transaction feature makes it a viable alternative to cash, which gives it an advantage over other cryptocurrencies such as bitcoin.

How to understand Bitcoin?

A Guide to Understanding Bitcoin and Cryptocurrency?

Although Bitcoin is one of the most searched terms (according to Google), it is a very technical topic for many people and can be too technical for non-geeks. However, there are now hundreds of cryptocurrencies and more and more people are starting to want to know how they work, possibly motivated by the distrust of bankers, which is a completely different discussion.

It’s hard to get a teacher’s explanation without having to use technical terms like “secret keys,” “digital keys,” “digital wallet,” and “cryptocurrency,” so I’ll do my best to make things as simple as possible. as possible. tin.

The concept of Fiat money, that is, paper money, was formulated to make it easier for people to exchange goods or services to replace the exchange, as this would be limited to an exchange between two parties arranged at best. , while money allows you to provide your service or goods, and then buy any service or goods you need from one or the other.

Therefore, I would say that Bitcoin is the equivalent of 21st century exchange, as it works as an exchange of goods or services directly between two willing parties. The exchange had to be based on every promise and trust, to provide and deliver the promised goods or services.

Today, with Bitcoin or any other cryptocurrency, each party would need a unique file or a unique key to exchange the agreed value between them.

Having a unique key or file makes it easier to keep track of each transaction. However, this also leads to problems.

Now, the exchange is the simple exchange of skills or goods as I said, the modern equivalent, or bitcoin is susceptible to breaches of security, ie theft or piracy of files, this is where a “wallet of cryptocurrency “enters the equation to make sure. your transactions.

Basically, you need a secure location for your cryptocurrency / bitcoin purchases and holdings. Hence the need for a hardware portfolio.

So now that you’ve written down / recorded which address contains how many Bitcoins and then updated each time a transaction is made, the file is known as the “Blockchain” and keeps track of all transactions made with bitcoins.

The next issue is to ensure that our files are unique.

I will address this in my next article.

The future of Bitcoin

The world is changing rapidly in recent times and so is the monetary system. With the use of cryptocurrencies like Bitcoin in vogue, people are curious to assess the possible future of Bitcoin, which must be determined and relied on cunning facts and rationality.

In 2009, there was a new currency concept that was introduced to the financial world. It was a bit confusing to people, but in a period of a year or two, it emerged as a trend. Today, more and more people and businesses are using Bitcoins for a variety of reasons. The digital currency is still undergoing regular updates to improve it in every way possible.

ANY OPINION ON BITCOIN

People all over the world have become aware of cryptocurrency. In addition, there are many more opinions about the experts. It is quite common to find that currency experts who are pro-bitcoins estimate that the currency is expected to hit between $ 250,000 and $ 500,000 for each currency in the next two years.
On the other hand, there are several well-known financial analysts and specialists who do not hesitate to warn people about the problems they may face when investing in Bitcoins. Experts accept the fact that this currency called Bitcoin and other cryptocurrencies may have a lot to give to the public, but it is not far off the day when investors will suffer and receive a considerable blow.

There are several advantages and disadvantages of Bitcoins. If the drawbacks are removed, there is a strong possibility that the entire international financial system will undergo a transformation. Let’s take a look at them:

SOME BITCOIN BENEFITS

• You really have total control over your money and you can send and receive any amount 24×7. This is possible because transactions are not executed by central or commercial banks or any centralized organization.
• The transaction fee is minimal compared to any other online money transaction. The mining service that records the transactions in the blockchain in question actually charges the fees, and that’s pretty low.
• Because personal information is not exchanged, it is the safest way to make money. Plus, there are no issues.
• With minimal processing cost, everyone can depend on the fastest and most reliable way to transfer money.
• Bitcoin is not affected by price fluctuations in any of the global economies, unlike other currencies.

BITCOIN AGAINST THEM

• Bitcoin needs to have better control over local and global financial markets.
• Bitcoin price stability should be focused on more people and companies using cryptocurrency.
• There is still no guarantee on the purchasing power of Bitcoin, which could be provided to investors or users.

The future of Bitcoin is simply all about speculation
The cons of Bitcoins cannot be easily ignored, but somehow they can be easily deterred. With a stronger market presence and more price stability, it may be the easiest online currency type in the future. The future of Bitcoin is basically nothing but speculation. There are positive responses from people all over the world and it has the potential to become the next big thing.

How to Buy Bitcoin – Step One

The best way to learn about bitcoin, is to jump in and get a few in your “pocket” to get a feel for how they work.

Despite the hype about how difficult and dangerous it can be, getting bitcoins is a lot easier and safer than you might think. In a lot of ways, it is probably easier than opening an account at a traditional bank. And, given what has been happening in the banking system, it is probably safer too.

There are a few things to learn: getting and using a software wallet, learning how to send and receive money, learning how to buy bitcoin from a person or an exchange.

Preparation

Before getting started, you will need to get yourself a wallet. You can do this easily enough by registering with one of the exchanges which will host wallet for you. And, although I think you are going to want to have one or more exchange wallets eventually, you should start with one on your own computer both to get a better feel for bitcoin and because the exchanges are still experimental themselves. When we get to that stage of the discussion, I will be advising that you get in the habit of moving your money and coins off the exchanges or diversifying across exchanges to keep your money safe.

What is a wallet?

It is a way to store your bitcoins. Specifically, it is software that has been designed to store bitcoin. It can be run on your desktop computer, laptop, mobile device (except, as yet, Apple) and can also be made to store bitcoins on things like thumb drives. If you are concerned about being hacked, then that is a good option. Even the Winklevoss* twins, who have millions invested in bitcoin, put their investment on hard drives which they then put into a safety deposit box.

*The Winklevoss twins are the ones who originally had the idea for a social networking site that became Facebook. They hired Mark Zuckerberg who took their idea as his own and became immensely rich.

What do you need to know about having a bitcoin wallet on your computer?

Below you can download the original bitcoin wallet, or client, in Windows or Mac format. These are not just wallets, but are in fact part of the bitcoin network. They will receive, store, and send your bitcoins. You can create one or more addresses with a click (an address is a number that looks like this: 1LyFcQatbg4BvT9gGTz6VdqqHKpPn5QBuk). You will see a field where you can copy and paste a number like this from a person you want to send money to and off it will go directly into that person’s wallet. You can even create a QR code which will let someone take a picture with an app on their phone and send you some bitcoin. It is perfectly safe to give these out – the address and QR code are both for my donations page. Feel free to donate!

NOTE: This type of wallet acts both as a wallet for you and as part of the bitcoin system. The reason bitcoin works is that every transaction is broadcast and recorded as a number across the entire system (meaning that every transaction is confirmed and made irreversible by the network itself). Any computer with the right software can be part of that system, checking and supporting the network. This wallet serves as your personal wallet and also as a support for that system. Therefore, be aware that it will take up 8-9 gigabytes of your computer’s memory. After you install the wallet, it will take as much as a day for the wallet to sync with the network. This is normal, does not harm your computer, and makes the system as a whole more secure, so it’s a good idea.

Bitcoin Qt

  • The original wallet.
  • This is a full-featured wallet: create multiple addresses to receive bitcoins, send bitcoins easily, track transactions, and back up your wallet.
  • Outside of the time it takes to sync, this is a very easy to use option.
  • Search for Bitcoin Qt wallet download to find their site.

Armory

  • Runs on top of Bitcoi Qt, so it has all of the same syncing requirements.
  • Armory allows you to back up, encrypt, and the ability to store your bitcoins off line.
  • Search for Bitcoin Armory Wallet to find their site.

If you don’t want to have that much memory used or don’t want to wait for your wallet to sync, there are good wallets that do not make you sync the entire history of bitcocin:

Multibit

  • A lightweight wallet that syncs quickly. This is very good for new users.
  • Search for Bitcoin Multibit Wallet to find their site.

Electum

  • In addition to being quick and light, this wallet allows you to recover lost data using a passcode.
  • Search for Bitcoin Electum Wallet to find their site.

After you get the wallet set up, take a few minutes clicking around. Things to look for:

o There will be a page that shows you how many bitcoins are currently in your wallet. Keep in mind that bitcoins can be broken up into smaller pieces, so you may see a decimal with a lot of zeros after it. (Interesting note, 0.00000001 is one Satoshi, named after the pseudonymous creator of bitcoin).

o There will be an area showing what your recent transactions are.

o There will be an area where you can create an address and a QR code (like the one I have above). You don’t need the QR code if you don’t want it, but if you run a business and you want to accept bitcoin, then all you’ll need to do to accept payment is to show someone the QR code, let them take a picture of it, and they will be able to send you some money. You will also be able to create as many addresses as you like, so if you want to track where the money is coming from, you could have a separately labeled address from each one of your payees.

o There will be an area with a box for you to paste a code when you want to send money to someone or to yourself on an exchange or different wallet.

There will be other options and features, but to start out with, these are the items that you should know about.

Getting Your First Bitcoins

Now that you have a wallet, you will, of course, want to test them out.

The very first place to go is http://faucet.bitcoin.st/.

This is a website that gives out small amounts of bitcoin for the purpose of getting people used to using them. The original version of this was run by the lead developer of bitcoin, Gavin Andreson. That site has since closed and this site operates by sending out one or two advertisements a month. You agree to receive those messages by requesting the bitcoins. Copy and paste your new bitcoin address and enter a phone number to which you can receive an SMS. They send out an SMS to be sure that people are not continuously coming back for more since it costs nothing to create a bitcoin address. They will also send out once or twice a month advertisement to support their operation. The amount they send it trivial: 0.0015 BTC (or 1.5 mBTC). However, they process almost immediately and you can check to see that your address and wallet are working. It is also quite a feeling to get that portion of a bitcoin. (Non-disclaimer: I have no connection with this site and receive nothing if you use them. I simply think they are a good way to get your feet wet).

Congratulations! You have just entered the bitcoin economy.

To get your feet a little wetter, you can go panning for gold. There are a number of services and websites out there that will pay you in bitcoin to do things like go to certain websites, fill out online surveys, or watch sponsored videos. These are harmless, and you can earn a few extra bitcoins this way, but it is important to remember that these are businesses that get paid when people click on the links on their sites. They are essentially kicking back a portion of what they get paid to you. There is nothing illegal, or even immoral about this (you might like what you see and make a purchase!), but they are frequently flashy and may not be completely straightforward. All the ones that I have tried (particularly bitvisitor.com) have paid out as advertised. It is interesting to experiment with these, but even with the likely rise in the value of bitcoin, you won’t become a millionaire doing this. So, unless you are an advertisement junkie, I would recommend you move on. If you would like to try, simply Google “free bitcoins” or something along those lines and you will find numerous sites.

Buying Bitcoin Hand-to-Hand

Finally, this is going to be the real test of bitcoin. Can people easily trade them back and forth? If this can’t happen, then there can’t really be a bitcoin economy because retailers won’t be able to use it. If retailers can’t use it, what earthly good is it? Fortunately, this is not really a problem. iPhone is a bit of a hold out, but many smartphones have apps (mobile wallets) that will read QR codes and allow you to send bitcoin to whomever you want. You can also display a QR code of your address, or even carry a card in your wallet with your QR code to let people send bitcoin to you. Depending on what kind of wallet you have, you can then check to see if the bitcoins have been received.

A couple of things to note:

  • When you set up your wallet, if you click around a bit, you will see an option to pay a fee to speed transactions. This money becomes available to a bitcoin miner as he/she/they process bitcoin information. The miners doing the work of creating blocks of information keeps the system up to date and secure. The fee is an incentive to the miner to be sure to include your information in the next information block and therefore “verify” it. In the short term, miners are making most of their money by mining new coins (check the section on What Are Bitcoins for more information about this). In the long term, as it gets harder to find new coins, and as the economy increases, the fees will be an incentive for miners to keep creating more blocks and keep the economy going. Your wallet should be set to pay 0 fees as a default, but if you want, you can add a fee to prioritize your transactions. You are under no obligation to pay a fee, and many organizations that process many small transactions (like the ones that pan for gold described above) produce enough fees to keep the miners happy.
  • In clicking around your wallet, on the transactions page or linked to specific transactions, you will see a note about confirmations. When you make a transaction, that information is sent out into the network and the network will send back a confirmation that there is no double entry for that bitcoin. It is smart to wait until you get several confirmations before walking away from someone who has paid you. It is actually not very easy to scam someone hand-to-hand like this, and it is not very cost-effective for the criminal, but it can be done.

Where can you buy bitcoin like this?

  • You may have a bitcoin Meetup in your area.
  • You can check out localbitcoins.com to find people near you who are interested in buying or selling.
  • Some are trying to start up local street exchanges across the world. These are called Buttonwoods after the first street exchange established on Wall Street in 1792 under a buttonwood tree. See if there is one, or start one, in your area.
  • See if you have any friends who would like to try bitcoins out. Actually, the more people who start using bitcoin, the larger and more successful it will be come. So please tell two friends!

Some people ask if it is possible to buy physical bitcoins. The answer to this is both a yes and a no. Bitcoin, by its very nature, is a digital currency and has no physical form. However, there are a couple of ways that you can practically hold a bitcoin in your hands:

  • Cascascius Coins: These are the brainchild of Mike Caldwell. He mints physical coins and then embeds the private keys for the bitcoins inside them. You can get the private key by peeling a hologram from the coin which will then clearly show that the coin has been tampered with. Mike has gone out of his way to ensure that he can be trusted. These are a good investment strategy as in the years to come it may be that these coins are huge collector’s items.
  • Paper Wallets: A paper wallet just means that rather than keeping the information for your bitcoin stored in a digital wallet, you print the key information off along with a private key and keep it safe in a safe, in a drawer, or in your mattress (if you like). This is highly recommended and cost effective system for keeping your bitcoin safe. Keep in mind, though, that someone could steal them or if your house burns, they will go with the house and there will be no way to get them back. Really, no different than cash. Also, as with Casascius Coins, they will not really be good for spending until you put them back into the computer.

* There is software to make printing your paper wallets easier. bitcoinpaperwallet.com is one of the best and includes a good tutorial about how to use them.

* The bitcoins are not actually in the wallet, they are still on the web. In fact, the outside of the wallet will have a QR code that will allow you ship coins to the wallet any time you like.

* The sealed part of the wallet will have the private key without which you cannot access the coins. Therefore, only put as many coins on the wallet as you want to be inaccessible. You will not be able to whip this thing out and take out a few coins to buy a cup of coffee. Rather, think of it as a piggy bank. To get the money, you have to smash it. It is possible to take out smaller amounts, but at this point the security of the wallet is compromised and it would be easier for someone to steal the coins. Better to have them all in or out.

* People who use paper wallets are usually security conscious, and there are a number of ways for the nefarious in the world to hack your computer. Bitcoinpaperwallet.com gives a lot of good advice about how to print your wallets securely.

Some people have also asked about buying bitcoins on eBay. Yes, it is possible, but they will be far overpriced. So, selling on eBay might seem to be a better option given the extreme markup over market value you might see. But, as with anything that is too good to be true, this is too good to be true. As I will explain in the next section, selling bitcoin this way is just way too risky.

How Not to Buy Bitcoin

In the next section, I am going to explain a couple of key points about buying from Bitcoin Exchanges. Before I do, let me give you a warning.

A short history lesson: When people first started setting up actual business based on bitcoin, they used all of the tools available to any merchant. They sold by credit card and PayPal. The problem with this business model was quickly spotted: bitcoin transactions are not reversible by anyone except the recipient of the money. Credit cards and PayPal have strong buyer protection policies that make it relatively easy for people to request a chargeback. So, nefarious individuals realized this and began making purchases of bitcoin and then sooner or later requesting a chargeback. And, since bitcoin is a non-physical product, sent by new and poorly understood technological means, the sellers were not able to contest this. Because of this, sellers stopped accepting credit cards and PayPal.

This was a big problem for the currency: How to move money between buyers and seller? Some business emerged that would credit you with bitcoin if you wired them money. Very often these businesses would give addresses in Albania, Poland, or Russia. The fact is that many of these did work and there are a lot of stories on the forums of people who bought bitcoins this way. But it took a lot of time and in the meantime the buyer just had to bite his or her fingernails wondering if they would get their bitcoins or kiss their investment goodbye.

I expect that as bitcoin becomes more acceptable and valuable, we are going to see a version of the Nigerian Prince scam. So the warning is this: we now have exchanges and other businesses that allow for moving money easily onto and off of exchanges. Never wire money for bitcoin. It was a short-lived, and well-forgotten, moment in the history of bitcoin.

Next, I will be talking about how to buy from a bitcoin exchange and give a review of the some of the best known exchanges.

What is Bitcoin and its features?

Introduction to Bitcoin

Bitcoin is an advanced form of currency that is used to buy things through online transactions. Bitcoin is not tangible, it is completely controlled and made electronically. Care must be taken when contributing to Bitcoin, as its cost is constantly changing. Bitcoin is used to make different exchanges of currencies, services and products. Transactions are made through the computerized portfolio, so transactions are processed quickly. All these transactions have always been irreversible, as the identity of the customer is not revealed. This factor makes it a bit difficult when deciding on Bitcoin transactions.

Bitcoin features

Bitcoin is faster: Bitcoin has the ability to organize odds faster than any other mode. Generally, when one transfers cash from one side of the world to the other, a bank takes a few days to complete the transaction, but in the case of Bitcoin, it only takes a few minutes to complete. This is one of the reasons why people use Bitcoin for different online transactions.

Bitcoin is easy to set up: Bitcoin transactions are made through an address owned by each customer. This address can be easily set up without going through any of the paperwork that a bank does during the creation of a record. Address creation can be done without any changes, credit checks, or queries. However, all customers who want to consider contributing should always check the current cost of Bitcoin.

Bitcoin is anonymous: Unlike banks that keep a complete record of their customers ’transactions, Bitcoin does not. Does not track customer financial records, contact details or any other relevant information. The Bitcoin portfolio does not normally require any significant data to function. This feature raises two points of view: firstly, people think that it is a good way to keep their data away from a third party, and secondly, people think that it can lead to dangerous activities.

Bitcoin cannot be repudiated: When one sends Bitcoin to someone, there is usually no way to get the Bitcoin back unless the recipient feels the need to return it. This feature ensures that the transaction is complete, that is, the payee cannot claim to have received the cash.

Bitcoin is decentralized: One of the main features of Bitcoin is that it is not under the control of a particular management expert. It is managed in such a way that all the companies, individuals and machines involved in exchange control and mining are part of the system. Even if part of the system crashes, cash transfers continue.

Bitcoin is transparent: Although only one address is used for transactions, each Bitcoin exchange is registered in Blockchain. So, if at any time the address of one was used, they can know how much money is in the wallet by using Blockchain logs. There are ways in which one can increase the security of their wallets.