evlPanda said..Wow, long post. I've only been into bitcoin, really, only this month. Part of the "fourth wave" or something. It's been an interesting journey. Like most things it took ages to first figure out and now I can replicate in a few minutes with my eyes closed.
Explaining it to others helps me clarify it to myself.
ICOsThis is not bitcoin, this is another cryptocurrency called Ethereum. ICOs (initial coin offerings) are dodgy as the dodgy brothers. They are the same as a completely unregulated IPO (initial public offering) for a company going public on the stock market, but with no rules! Yeeeeehar! Basically, for Ethereum startups, I do not understand how they could possibly be worth that much. It makes no sense to me so I don't participate.
If anyone can show me anything
actually running on ethereum, like
really working, I might be more interested. Just one thing.
BTC Exchanges
I use CoinJar it as an exchange. The only exchanges I know of that accept $AUD are CoinBase and CoinJar. The former accepts only credit cards and adds on 4%. The latter is a "market maker" (look it up) so has different buy/sell prices to other exchanges, but adds 1% for transactions and does bank transfers. All-in-all it works out the same price for both exchanges (yes, I tried buying at lower price with CoinBase and selling at higher price with CoinJar, almost worked actually, lost about 0.5%)
...there's btradeaustralia.com but I recall they wanted 4% too.
If anyone can recommend a better exchange I'm all ears. : )
CoinJar
But, I
move my btc out of CoinJar ASAP:
www.reddit.com/r/Bitcoin/comments/2xfag9/psa_zhou_tong_created_coinjar_the_service_behind/?st=j5a9wedh&sh=e609e24dScary, eh?
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Storing BTC
After Mt. Gox I just wouldn't trust any online exchange to look after my btc
and my keys. It's crazy if you think about it.
However, if I
had to I'd go with CoinBase over CoinJar. They seem more legit.
The good news is that you can be your own bank. And that's how Bitcoin was intended to be used.
Download Electrum and have a play with it.
electrum.orgThere's not really a "Bitcoin Guide for Dummies" that I've found. I have to admit it can be overwhelming, and it's bottomless (you could end up researching cryptography and game theory).
So here's my attempt at buying and safely storing bitcoin:
1. Get Electrum (or perhaps armoury)
electrum.org2. Setup a wallet in Electrum. Now, a wallet contains many addresses, and each address is (somewhat) akin to a paper note like we have in our physical wallets. When you create your wallet all addresses in it will be empty.
Electrum has a snazzy feature where it randomly generates a 12 word "seed phrase". This seed then goes into
determinalistically (spelling) generating a wallet and a few dozen addresses (all empty). Because it is generated
determin... deterministically (!) you can regenerate the exact, same wallet again on any computer if you know the seed. This means all you need to store, effectively, is the 12 word seed!
So you create your wallet, offline of course, and you're ready to receive bitcoin. Make a note of the 'receiving address', or any of the addresses it has generated, you will send the btc you buy on the exchange to that address in the next step.
3. Buy bitcoin on an exchange, like CoinJar or CoinBase. Again the former sells at a higher price but the latter charges +4%. To setup an account with either takes 1-2 business days and requires you send them photo ID. I used my drivers license.
iPoli takes a day to transfer from your bank account to your exchange cash account. You can use CoinBase and transfer immediately for +4% (actually why aren't i buying form CoinBase?)
Then, using the 'receiving address' (starts with a 1) from you Electrum wallet you send the btc from your exchange wallet to the wallet on your computer.
Now the btc is in
your wallet, and only you have the keys to it.
# Information both interesting and importantAddresses
Wallets are made up of addresses. These addresses are like paper notes with a value of btc in/on them. They contain "unspent coins". So, when you use them, just like cash, you send the recipient
the entire value of the address. Read that last sentence again.
Any change gets sent back to
another address in your wallet (I've yet to figure out how the change knows where to go btw, but it does). This is a security feature; makes it harder to trace funds moving around.
So, especially for paper wallets, when you transfer the btc in them to, say, your wallet, transfer
all of the btc, so there's no change getting lost.
KeysEach address has a private key. An address is basically a public key/address that you ask people to send btc to.
The private key allows you to spend money from that address. I'll keep it that simple. You obviously never reveal your private keys to anyone.
4. Backups and cold-storage and paper wallets and such.You can simply backup your Electrum wallet, as a file, to a usb. Or wherever. You are backing up the addresses and their private keys. You aren't actually backing up the balances of each address, they are stored in the blockchain.
Note that you should do this often if you are making lots of transaction, as when it runs out of addresses it auto-generates more for you, and those new ones might not be in your backup. (it makes heaps of addresses at first)
Electrum also lets you encrypt your wallet with a password, pretty standard.
That's probably enough to be honest. Note that you really only need your 12 word seed phrase to completely regenerate the wallet!
Paper wallets are pretty snazzy too. They have one or more addresses on them, containing the public and private keys (you fold it so the private key is hidden etc.). See
https://bitcoinpaperwallet.com. You can use one of the addresses you created in Electrum if you want.
Basic rule is to do as much as possible offline. Preferably on a clean machine. (bitkey.io is pretty handy for this.)
Razzonater
> 9 months ago, 31 May 2017
But than again, we trade futures. But at least behind the trading in futures, there actually are real stuff like grains, oranges, apples, etc that are being sold, although well into the future.
