So You Think You Want to Buy Cryptocurrencies?
- November 27, 2020
So you think you want to buy cryptocurrency?
By Pete Richison owner of Miners-Warehouse.com
Bitcoin, Crypto, Hash rate, Speculation, Fraud, Wallets… Surely you have heard some of these words when surfing topics like Bitcoin and crypto currencies. And now you think you might want to get involved. But how do you do it safely? Where? Can you just Google bitcoin and get started? Do you need a special app? Where do you buy one of those wallet thingies? I am going to guide you through a bit of the basics and suggest that the first thing you do is read a ton on this topic so you can start to properly understand this crazy crypto world.
For starters lets briefly review the basic. Bitcoin is the most well-known and valuable crypto currency as of the time of this writing (Nov 2020). It was initially invented in 2008 by an unknown person known only as “Satoshi Nakamoto” and then fostered by a small group of computer folks who started to spread its use case around the world. It is a decentralized and peer-to-peer payment network where you can exchange funds with anyone in the world who has a bitcoin wallet, without having to use a third party like a bank or payment service like PayPal. You can easily cross borders with it and funds are typically transferred within 20 minutes. If you are someone who has dealt with wire transfers or international funds transfers you will understand the value of this feature alone. Also bitcoin is decentralized which in short means no one is in control of it, and there is no one “data center” that could be hacked to steal everyone’s funds or information. Instead the bitcoin network is made up of millions of computers around the globe called miners (hence the name, Miners Warehouse!). Each computer mining bitcoin stores a copy of the bitcoin ledger and they all must agree with one another in real time, so even if one, or many, computers were somehow hacked the attackers would have to hack over 50% of the millions of computers at the exact same time to ever have a chance to cheat the bitcoin network.
Funds are stored in a “wallet” and a wallet is simply a bitcoin address. Bitcoin addresses are complex strings of letters and numbers and they look like this, 3Bog2mNAAg5NfMJarwqjN4Eg3PkggAWFrz. The owner of a bitcoin address has a specific 24-word “seed phrase” or essentially a password that is required to access the funds inside of it. If you have a bitcoin address on an exchange like, Coinbase, you will not have the seed phrase personally because Coinbase holds that information and acts like a custodian for your funds (just like a bank does). Just remember that if you aren’t the one with the seed phrase, the coins can potentially be taken from you without your knowledge. The best way to store bitcoin is with a paper wallet or something like a ledger wallet where you are actually in control of the wallet and its seed phrase yourself. Just don’t lose it! If you lose your seed phrase, there is no one to call and ask for it back; and all coins stored in that wallet will be lost forever. Just like if you lost a $100 bill, its gone and there is no getting it back. It is highly recommended that you have multiple copies of your seed phrase in multiple different secure physical locations for this exact reason.
When you are first getting started in crypto currencies I would suggest just using an app that allows the purchase of coins like Coinbase, click here to open your own Coinbase account and get $10 in free bitcoin with the account once you fund it! Once you have begun to accumulate a little value in coins the common advice given in the crypto world is to get those funds off of an exchange (like Coinbase or Binance, etc) and instead get them into a more secure wallet like mentioned above.
Once you buy a little bitcoin be ready to ride the waves. Do not ever invest anything that you aren’t willing to lose and try not to get emotional with your buying and selling. Bitcoin pricing has remained very volatile and it’s not unrealistic to see massive swings in the value of your coins over time (both upwards and downwards). So if you have decided to do this and get involved in bitcoin, buy some coins then buckle up and enjoy the roller coaster ride!
If you are interested in learning more about mining bitcoin and the purchase of bitcoin mining equipment please visit my website www.Miners-Warehouse.com.
(Please note that this article is for informational purposes only and does not constitutes financial advice in any form.)