Get Started with Bitcoin - June 2018
The Beginner's Guide with Easy Step-By-Step Instructions
What? Why? How?
Bitcoin has never been as popular as today. Demand increases as more and more understand the benefits and opportunities with the cryptocurrency. This is a guide to help you get started with Bitcoin.
What is Bitcoin? Why should you use Bitcoin? How do I get started and buy Bitcoin? We will answer these questions and explain everything you need to know.
This is a brief review of the digital currency to get started quickly. We have simple step by step instructions, and at the end of the guide, we help you to buy Bitcoin instantly.
There are people who say they don’t use Bitcoin because they don’t understand the underlying Blockchain technology. A common excuse for not getting started with new technology.
It’s easy to buy and use Bitcoin, and you don’t need to understand the technology to use it (even though that is good). It was the same at the beginning of the Internet. However, today all use the Internet even though everyone doesn’t understand the technology.
Bitcoin is here to stay, and it’s proven that the technology works and is safe. The only question is how long you will wait before you buy the cryptocurrency. Have you been thinking of buying Bitcoin but hasn’t because of the high price? You’re not alone. However, remember that the price was also expensive at $10, $100 and 1000 dollars.
Past performance is no guarantee of future results. But there will never be more than 21 million bitcoins. If you only buy one bitcoin, you always own more than about 99.85% of the world’s population. (You can, of course, buy less than one bitcoin).
What? Why? How? If you can answer these questions, you already have more knowledge about Bitcoin than 99% of the population. Time to stop procrastinate and get started with Bitcoin!
What Is Bitcoin?
Bitcoin was the first decentralized digital currency, also called cryptocurrency. It works like cash or gold that can be transferred on the internet across the globe. You can transfer money as easily as sending an email.
This means that you can send money person-to-person without a middleman or involvement of any third party. In other words, you avoid expensive fees and long waiting times as at the bank.
We can briefly describe Bitcoin as follows: Bitcoin is an independent, global and public ledger used to transfer and store value.
- It’s independent because no state, bank or institution can control or manipulate Bitcoin.
- It’s global because everyone can send money fast and cheap 24/7 to anyone on earth.
- It’s public because all transactions are stored in a common ledger. At the same time, Bitcoin is anonymous because everyone can participate without having to identify themselves.
Bitcoin is secure because it is based on cryptography and mathematics. All users decide together over the Bitcoin network and its rules. There is no central bank that can print more and more money to reduce the value.
Protection against inflation is one of the benefits with the cryptocurrency. Read about more benefits and why everyone should use Bitcoin in the next section.
This is a brief description of Bitcoin. If you want to learn more, we have detailed guide about Bitcoin. There we go through what money is, where bitcoin comes from, why the cryptocurrency has value and much more.
Why Use Bitcoin?
Why should I use Bitcoin instead of my credit/debit card or cash? There are many answers to that question because Bitcoin has many different uses. Below we summarize the main benefits of using Bitcoin.
- Fast payments globally: With Bitcoin, you can transfer money around the world in just a few seconds. Bitcoin is the first global currency.
- Extremely low transaction fees: It costs almost nothing to transfer bitcoin. In addition, fees are voluntary in the network.
- Bitcoin is a secure system: Bitcoin is impossible to counterfeit and is secure with the help of math and cryptography. The current financial system is secured by laws which will always contain loopholes.
- You don’t need to trust any third party: There is no intermediary that can deny your transaction or demand expensive fees. All payments are made person-to-person without having to rely on any company. You control your own money.
- Bitcoin is anonymous but also transparent: It’s anonymous because you don’t need to identify yourself in the Bitcoin network. It’s transparent because the ledger of all transactions is public.
- The Bitcoin network is decentralized: The digital currency is decentralized in the same way as the internet. Bitcoin is more fair because no single group can control or manipulate it.
- Protect your money against inflation: Perhaps the biggest advantage of Bitcoin is that your money is protected against inflation. Bitcoin has a limited supply to preserve the value of your money.
If you want to learn more about the advantages of using Bitcoin, read this guide.
How to Get Started
Good, now you know what Bitcoin is and why you should use it. Then it’s time to get started with the cryptocurrency. If you follow our guide with step-by-step instructions, it only takes a few mintures.
First, we show you how to create or buy a secure Bitcoin wallet. Then we will help you buy your first bitcoin. Thereafter we will explain how to protect and store your bitcoin.
The final step is to send and receive bitcoin, so you learn how to use the cryptocurrency. We will help you all the way to avoid common beginner mistakes.
It’s easier than many think with Bitcoin. But since it’s about your money it can feel safe with guidance. Here are four steps to start using Bitcoin today:
Step 1: Create a Bitcoin Wallet
Step 2: Get Your First Bitcoin
Step 3: Secure Your Bitcoins
Step 4: Send and Receive Bitcoin
In the following sections, we will go through all the steps in detail. We end with important about safety along with some tips and advice. It is important that you read the security information!
1. Create a Bitcoin Wallet
A Bitcoin wallet is needed to receive and send bitcoins. It’s easy to create a Bitcoin wallet, but there are many different types with various security.
With Bitcoin, you have a private and public key that you keep in a wallet. Simply explained, your public key acts as your email address and your private key as your password.
This means you need to protect your private key and not show it to anyone. That’s why you need a secure Bitcoin wallet.
If you want to buy Bitcoin for a smaller amount, you can use an online wallet. That is automatically created when you open an account at a Bitcoin exchange. At the end of the guide, we have listed popular and secure Bitcoin exchanges.
However, we strongly recommend buying a hardware wallet if you want to buy bitcoin on a regular basis or for a larger amount. That is the best type of Bitcoin wallet because it’s both easy to use and very secure. Ledger is the most popular hardware wallet on the market.
If you create your own online wallet or software wallet, you should back up your private key and keep it offline. You don’t need to think about that with a hardware wallet because it protects your private keys for you.
Read our Bitcoin wallets guide to learn more about different types of wallets and safe storage of Bitcoin.
2. Get Your First Bitcoin
You can get Bitcoin in three different ways. The most common and usually easiest is to buy Bitcoin on a marketplace. But you can also sell a product or service in exchange for Bitcoin.
The third way is to earn Bitcoin through Bitcoin Mining. Then you install software on your computer to verify transactions and get rewarded with Bitcoin. However, it’s hard to make money with mining, and it requires great knowledge and a lot of resources.
We recommend that you buy your first Bitcoin on a trustworthy exchange. There are many places to choose from, but not everyone is safe and reliable.
We will help you choose the best exchange for you. Below we have listed marketplaces where you can buy Bitcoin easily and safely:
- If you are a beginner and want to buy Bitcoin for the first time, we recommend Coinmama or Coinbase. You can buy directly with your credit/debit card at both places. This is the easiest way to get started.
- If you plan to buy Bitcoin on a regular basis, you can save money by using a cryptocurrency exchange. Two popular exchanges are CEX.IO and Bitfinex. They offer more features and settings but are not as user-friendly.
Learn more about the crypto market in our guide about Bitcoin Exchanges. We explain everything about exchanges and different ways to buy and sell Bitcoin.
3. Secure Your Bitcoins
Have you bought Bitcoin? If the answer is no, scroll up! If the answer is yes, congratulations! Welcome to the future financial world where you can be your own bank.
The next step is to secure your Bitcoin by taking control of your private keys. Now you need a secure Bitcoin wallet that we helped you with in the first step.
When you buy Bitcoin on an exchange, the money (private key) is kept in your account at the exchange. This is risky as the company stores and controls your Bitcoin.
The whole purpose of Bitcoin is to control and protect your own money. If you keep your Bitcoin on an exchange, your account may be restricted or blocked. In the worst case, you lose your Bitcoin if the company goes bankrupt.
For your Bitcoin to be secure, you need to transfer them from the exchange to a secure Bitcoin wallet. Once you have bought Bitcoin on a marketplace, we strongly recommend that you transfer them to a secure hardware wallet.
Read our Bitcoin wallets guide to learn more about different types of wallets and safe storage of Bitcoin.
4. Send and Receive Bitcoin
The easiest way to learn about Bitcoin is to use Bitcoin. Therefore, you should make at least one Bitcoin transaction. We recommend that you send Bitcoin between two of your own wallets to learn how to send and receive Bitcoin.
You will learn this if you buy Bitcoin at an exchange and transfer them to your private Bitcoin wallet. To receive Bitcoin, you only need to share your public Bitcoin address. It consists of a code between 27-34 letters and numbers. The address can look like this:
Your private key looks similar but is shorter. Be sure to never share your private key! Most wallets create QR codes of the keys, to make it easier to send and receive Bitcoin.
A Bitcoin can be divided into one-hundredth of a million (0.00000001), also called a satoshi. When to transfer Bitcoin, the wallet usually recommends a transaction fee which varies depending on the market. The higher the fee, the faster the transaction is completed.
The number of stores and services that accept Bitcoin is growing every year. To pay or send Bitcoin is also simple but requires a few more steps:
- Open your wallet and navigate to the “Send” page.
- Fill in the recipient’s public Bitcoin address (or scan the QR code).
- Enter amount (many wallets automatically convert the bitcoin price to normal currencies).
- Make sure the address and amount are correct.
The transaction is usually done directly, but it may take a few minutes. If you’re transferring a large sum of money, you should wait for at least 6 confirmations to be 99.99% sure that the transaction is not canceled. Here you can learn more about How Bitcoin Works.
Important Security Information!
If you follow our guidelines, you’ll get started with Bitcoin without any problems. To make sure that you haven’t missed anything we will repeat some critical security information.
There are a variety of Bitcoin exchanges and services on the market. You should carefully evaluate products and services before using them. Beginners who are not aware of the security can lose their money.
However, it’s important to point out that Bitcoin is secure because it is based on mathematics. You can’t trick math. Likewise, you can’t trick Bitcoin. You only risk your Bitcoin if you use non-trusted exchanges and services.
Below we have listed important information to protect your Bitcoin. If you are aware of this and follow the guidelines, there is nothing to worry about.
- First of all, you need to know that Bitcoin transactions cannot be refunded. In that way, it works like digital cash. Bitcoin offers more freedom but at the same time more responsibility.
- Secondly, a Bitcoin transaction is only valid if it has been confirmed on the network. To complete a large transaction, we recommend that you wait for 6 confirmations to be on the safe side. The number of confirmations is usually displayed in the wallet or exchange.
- Bitcoin is pseudo-anonymous. This means that you can send and receive money without having to identify yourself. However, if your identity is linked to a wallet, you can map all transactions to it. All transactions are stored in a shared ledger and users can either be public or anonymous.
- There are many different types of Bitcoin wallets to choose from. But if you are serious about Bitcoin and want to protect your money properly, you should buy a hardware wallet. This is the safest way to protect and store Bitcoin. Read more about Bitcoin Hardware Wallets.
- There are hundreds of different cryptocurrencies and even more exchanges. Firstly, there are many unreliable exchanges that are not secure. Second, never store Bitcoin at an exchange, but instead transfer them to a private and secure wallet. At the end of the guide, we have listed popular exchanges where you can easily and safely buy Bitcoin. Read more about Bitcoin Exchanges.
Explore and Learn More
Good job! Now you know the basics of Bitcoin, but there is always more to learn. The cryptocurrency is changing and evolving all the time. Technology is improving every year, and new applications are continuously developed.
To avoid mistakes, you need to stay up to date. For example, more cryptocurrencies are created, and some use Bitcoin in its name. This can be confusing for new users and lead to mistakes.
A good website for keeping track of all cryptocurrencies and their prices is CoinMarketCap. If you’re interested in statistics and data, we can recommend Coin Dance. We mention more good websites and sources in our guides.
Bitcoin is here to stay. You can transfer money easily, quickly and cheaply. There are no geographical restrictions or closing times. Everyone on earth can transfer money 24/7 for extremely low fees.
We have many guides and reviews to help you navigate the crypto space. You can also subscribe to our newsletter below to stay up to date and get exclusive offers.
Below we list three of the most popular places where you can easily buy Bitcoin.
Frequently Asked Questions
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