Every day there are reports of new record levels for Bitcoin. Will Bitcoin continue to rise? What do experts say? Which exchanges are the best to buy Bitcoin? The most important information about Bitcoin at a glance.
Bitcoins seem unstoppable. The new currency has multiplied thousands of times within a short time.
Where to Buy Bitcoin?
You can buy Bitcoin from a number of exchanges:
The most mainstream option to buy Bitcoin. Certainly the most established. Buying and selling is easy and your bitcoins are insured. With Coinbase, you can buy bitcoin, litecoin, ethereum classic and ethereum.
Another great choice. Kraken is known for its security, support and low fees. Signing up and getting started is simple. Plus, it provides a few more options to choose from: buy bitcoin (BTC), ethereum (ETH), monero (XMR), dash (DASH), litecoin (LTC), ripple (XRP), stellar/lumens (XLM), ethereum classic (ETC), augur rep tokens (REP), Iconomi (ICN), melon (MLN), zcash (ZEC), dogecoin (XDG), tether (USDT), gnosis (GNO) and Eos (EOS).
These exchanges are very easy to use. If you can use PayPal or online banking, you can figure these out fairly quickly and can buy bitcoin within minutes.
Where to Store Bitcoin?
Another important question is how to secure your cryptocurrencies. First things first, don’t keep your coins on the exchanges — which are basically just centralized, unregulated online banks.
Cryptocurrencies are the first form of money you can store in your brain. That’s a revolutionary idea. But right now, it’s also pretty involved. It’s a long process. It’ll get easier, but for now, it’s not.
But even if you don’t want to store your bitcoin in your brain, it’s best practice to always have control of your private keys.
PUBLIC VS. PRIVATE KEYS
Your cryptocurrencies come with both a “public key” and a “private key.” Your public key is your address. It’s what you give to people who want to send you money.
Your private key is, put simply, your account “password.” When a transaction is executed, you “sign” the transaction with your private key. Your private key unlocks your funds.
When you hold your cryptocurrencies in exchanges, you don’t own the private key. The exchange does.
One great thing about cryptocurrencies is you can become your own banker — so keeping your crypto on an exchange defeats this purpose. It also goes against the idea of decentralization — centralized exchanges can’t be trusted. They have one vector of attack and, if hit hard enough, they come crashing down.
So how do you secure your coins (private keys)? I’ll talk about three ways in this chapter.
A. Store them in a downloadable “hot” wallet specific to your coin [easy, less secure]
B. Store them in your brain [very difficult, very secure]
C. Store them in your safe, hidden compartment or in a fake can of hairspray buried in your backyard [somewhat difficult, highly secure]
D. Store them in a cold wallet device [moderately easy, very secure]
The Downloadable “Hot” Wallet
Most currencies have their own “wallets” you can download and hold your coins on your computer or smartphone.
If you want a bitcoin wallet, for example, you can download it here: https://bitcoin.org/en/download
But wallets aren’t without risks. The security of your coins is as strong as the security of your device.
So if you’re going to go with this method, I suggest using a VERY strong password and having several backups. (encrypted USB sticks and external hard drives.)
If you want maximum security, I suggest you either:
A. Secure your money in your brain
B. Secure your money in your safe
C. (Most recommended) Secure it in a cold-storage wallet device (although this choice is limited to a few coins).
Let’s look at all of these one by one.
But before I do, if you’re an ABSOLUTE beginner, I’d suggest you just skip to C and get a cold-storage wallet device. They are pretty plug-and-play and they’re easily the safest way to store your coins.
Remember: The reason crypto exists is so you can better control your own money. If you don’t hold it, you don’t own it.
The best way to secure your bitcoins for mid- to long-term storage is to put them in “cold” storage.
Meaning, get them off of online exchanges and into an account where the private key has never been exposed to the Internet. (“Hot” wallets are those connected to the Internet and vulnerable to attacks.)
Thus, it’s virtually impossible to fall into the wrong hands online. (And as long as you secure it properly, it’ll be safe in the physical world, too.)
How to create a Web Wallet
Visit blockchain.info (https://blockchain.info/wallet/#/signup) to start a new Web wallet. An email address is optional but helpful for recovering your account should the need arise.
Cold Storage Devices
There’s also another less painful way to do all of this. Simply get a cold storage device. You can get one online for less than $100 and they’re specifically designed to be hack-proof.
The ones I recommend you check out are Trezor or Ledger wallets.
Unfortunately, they are currently limited to a few coins.
Both use state-of-the-art cryptographic technology to hold your private keys offline — even when the device is plugged into your computer. Learn more about either on their websites:
(Ledger supports bitcoin, ethereum, ethereum classic, litecoin, doge- coin, zcash, dash and stratis)