You will probably by now heard of one, if not all of these. They
are all examples of Cryptocurrency. We'll keep this loose, because
it is evolving all the time, but they are a means to transfer a
store of value directly from your 'wallet' to another person or
organisations 'wallet' by means of the 'Blockchain'. Digital
Currency, a bit like banks use, but decentralised, and not in the
hands of any Central Bank, in fact YOU are your own Bank. How cool
It cuts out the bank by replacing it with a decentralised network of 'nodes' and the transaction is carried in a public ledger, a copy of which is on every node, and this is called The Blockchain. Every node verifies the integrity of this ledger, and every transaction is recorded in this ledger with no ambiguity, as in - you can't double spend the same bitcoin, you can't alter the ledger. Once a transaction is included in a block, and that block is written, and added to the contiguous chain of blocks, it is unalterable*. That is a powerful technology, and the power of it is only just beginning to be understood. It will begin to change the world around you in so many new ways. It is the evolution of not just money, but of contracts and many other innovations yet to be discovered.
* Theoretically if a single mining operation can control in excess of 50% of the total mining power, then they can alter the blockchain. This may have been possible in the early days of mining, but now it would be economically prohibitive to achieve this position. The scale and distribution of bitcoin mining, and the concensus of these miners will maintain this condition.
Bitcoin is the currency carried on and mined from the blockchain,
and this enables remuneration for the computers that are hosting
this network, and the 'Miners'. These computers and miners are all around the globe,
and if you really begin to understand this technology, you may want
to get involved at this network level. Maybe host a full node, or
even start mining bitcoin.
You rarely spend a whole one, you'll send say 0.00127 Btc for something.
Here's the latest main Coin prices to US Dollar.
All other cryptocurrencies apart from bitcoin, are referred to as 'AltCoins'. There seem to be new altcoins springing up daily, but most of them aren't worth being involved with. Litecoin is already established, and a few of them such as Ethereum are gaining popularity.
You are used to exchanging Dollars, Euro's or other paper for goods or services. Cryptocurrency is no different, it has a market value at which you can buy or sell using it.
Once you have some Bitcoin, you are very unlikely to want to change it back into the paper stuff. Many people are now paid in Bitcoin.
Btc or XBT is the abbreviation for bitcoin, Litecoin is LTC, Ethereum is ETH. You will see these 'Coin Codes' used extensively, and they are usually the only term used in Exchanges to represent any particular Cryptocurrency.
You can get all the basics about Bitcoin and wallets from
and Ethereum.org for all your 'Ether' info, and of course Litecoin.org
Choose an Exchange, but make sure you get your wallet first, so you have an address, like a digital deposit box, to get the Bitcoin sent to. The easiest and most popular wallet is an online wallet from Blockchain.info or a local (on your own PC) wallet from Electrum
If you want to buy bitcoin or convert Bitcoin back to cash, you need an exchange where you are verified Coinbase is the biggest and best, legal and regulated in the US and Europe, or use Coinomat to withdraw to Visa Cards.
You don't even need to buy a whole Bitcoin. A Bitcoin is divisible into 'Satoshi' named after the creator 'Satoshi Nakamoto', so you can buy for example 0.25Btc, or say $50, or even 50 cents worth of Btc.
Conversion Rate 1 Bitcoin = 100 Million Satoshi
1mBtc = 0.001 Btc = 1 thousandth of a bitcoin
1 Bit = 0.000001 Btc = 1 Millionth of a bitcoin
1 Satoshi = 0.00000001 Btc = one 100 millionth of a bitcoin, the smallest unit.
Try this free online Bitcoin Converter get used to the values.
You're getting all excited, and it's now a good time to pause and read the rest of this tips section. It may save you from some of the piranhas that also swim in the Inernet Pond - And they all want your bitcoin so badly, they will try anything to relieve you of it.
'110% profit in 1 Day, 120% return in 1 week, Invest in Stemcell Technology, Invest in Oil Rig Contracts, Bitcoin Matrix - These are the kind of things you'll see that are typical of
scam sites, HYIPS and
You may even be tempted to send just a small amount - and then feel that you can trust the scheme as it returns that small amount promptly, and with interest.
This is old school standard con trickery - intended to lull you into trusting the conman with an ever larger amount. We have seen dozens of these sites.
Please please don't fall for prey to these cons - they are ancient tried and tested ways to steal your money. They depend on your greed, and then your excitement to take more and more from you. They will offer you upgrades to your investment, move you higher up the chain - for a fee of course, all the time underselling you and building a bigger pot to run away with.
The most prevalent type of Bitcoin scam, is the good old Ponzi scheme, a crowd of which are called hyips. Some even call it a 'game', and people do 'play' these schemes, trying to get in and out quickly and take the profit to the next ponzi. Few if any are successful with this strategy however, as most of these crooked schemes simply keep everything. Lately, the payment logs displayed on these sites are simply a pre-written array that updates a timestamp, and repeats.
These Ponzi's aren't always straight theft - but most may as well be.
Avoid many of these Badsites by checking here first. - The Badlist
There are some great sites out there that will pay you small amounts of Bitcoin to view ads (Ptc's) Here are some that we know will pay you properly.
PayPal and Bitcoin just don't mix
Too many people get robbed by people selling bitcoin and using PayPal as the payment medium. They will often ask you to send the payment as a 'gift' or a 'friends and family' payment. This gives you zero protection. Also as a digitally delivered product, bitcoin will always fall outside PayPal's buyer protection, and that's if the seller doesn't get their account suspended first. Just don't do it.
Mining cryptocurrency doesn't involve a pickaxe, but it does involve expensive equipment, with custom chips, especially designed for solving the complex maths problems required to 'solve' the block of data. These blocks, starting with the 'Genesis Block' form a continuous chain which is called the Blockchain. All coins whether Btc or Doge have their own Blockchain. By mining, you also discover the coins contained in these blocks. To mine a Bitcoin block on your own, is a lesson in futility. You need to pool your mining resources, and share the rewards with other miners.
Mining pools are springing up faster than anyone can keep up
with. You are essentially trusting these pools with your wages. Do
your homework, check the Bitcoin Forums, but even then, they can rip
you, rob you and leave you high and dry. A recent development is so
called 'Cloud Mining'. With these operations you don't even know the
equipment actually exists, and many appear to be 'false
markets' trading mining shares that may or may not exist.
Recently, cloud mining has become almost impossible to return a profit (ROI or Return on investment) as the altcoin market which led to the rise in cloudmining has virtually imploded. The price crash and sheer number of these altcoins has diluted this market to the point that it is now unprofitable
Other Mining pitfalls include Equipment that you buy, but never arrives - Preorder at your peril. If you're after a quick profit though, mining isn't for you. that train has left the station. You can still achieve a steady return from mining, but it may cost you more than you can get back. Do it for the fun factor, like a great many people, who just want to be involved.
A lot of mining scam sites are just 'clones' of legitimate operators, and these sites produce strikingly similar websites, but don't have any equipment to back it - up. Ask the site for proof of genuine mining if you aren't sure.
There are a few well established exchanges. Depending which Country or Jurisdiction you are in will dictate which of these
exchanges are available to you, in order to convert FIAT Currency (dollars pounds etc) directly into Bitcoin or Litecoin, and back again.
The same constraints are currently not applicable to the Cryptocurrencies themselves. They can be freely traded on a great many exchanges. The biggest danger to your funds in any exchange is probably internal fraud.
The now infamous Mt.Gox is almost certainly an example of internal fraud. "I got Goxxed" is a common term now.
The lesson that we learned from Mt.Gox and a few other Exchanges is to NEVER leave your bitcoin or altcoin in an Exchange any longer than you have to. Don't use an Exchange as a Wallet. When you send to an Exchange, your bitcoin is transferred to THEIR Wallet, and these can be vulnerable to both Hackers, and especially to Internal Fraud.
When choosing your exchange, read up about it, search it on Google etc. You will be surprised how chatty this community is when it comes to spotting security flaws that may threaten their irreplaceable Bitcoin. Currently, Coinbase, Bitstamp, BTC-e and a couple of others are enough for most users. You can also search for sellers, and Bitcoin 'ATM's' in your vicinity.
Pump groups are set up to benefit the one or more people who organise these unashamed and unethical scams. We know of exchanges
like MCX Now whose site owner actively promotes and approves of these 'Pumps'. If you aren't 'The Man' or in 'The Clique' - you will
be mercilessly fleeced by this pondlife. They kill off cryptocurrencies with their actions - they are literally killing the
goose that lays the golden egg, they are the single biggest threat to cryprocurrencies, and are too dumb, and personally selfish to
If you organise or participate in pumping a coin, then could you please refrain from ever having children. Thank You.
The person who sets up the
ponzi will always get rich - you probably won't. In a Ponzi Scheme - the early investors are paid out
by investments from later investors. Every scheme therefore has it's limits and normally will reach a point where new investors dry up
and you may be the one to lose out - Take your chances if you like risk. Will you be the one holding the bag ?
Most current Ponzi's just fake the logs, and steal your Btc outright.
The logs will give the impression that people are paid, but they are not paid!
If you don't have up to date antivirus software on your PC, don't enter the Bitcoin World. There are a few exploits that are well documented. A new one is Fake Flash Player exploits. Try AVG Antivirus - Free from Download.com also check your PC every couple of days with Malwarebytes AntiMalware. Use CCleaner before you close it down. Do all these and you are reasonably safe from malicious software. Most informed IT people will do all this daily. For the best level of safety - use Linux, and we also recommend you use a VPN
Your Bitcoin Wallet is like the wallet in your pocket - except in the case of an online wallet
such as Blockchain.info where you have the private key for that wallet - so it is incredibly difficult for anyone to steal your wallet and make
use of the Bitcoin without your private key.
Despite what you may read in the Press, no wallet has ever been stolen or hacked from any Blockchain.info user. The security at this organisation sets the standard for online security.
If you use a local wallet like BitcoinQT, or Multibit your wallet is stored locally on your own computer, usually called wallet.dat, and in your 'roaming' folder. You can copy, move, encrypt and store that wallet offline, Create a paper wallet or on a USB stick etc, and one new startup will even turn it into an audio CD for you.
A sensible approach is to use two wallets at least - one online like Xapo or Blockchain and one offline like BitcoinQT or Multibit (available free) With QT and Multibit, you can also password protect your wallet, back it up easily etc.
Download either wallet at Bitcoin.org
Keeping all your Bitcoin in one place is a potential point of total loss. Best to spread it about a bit until we can all be sure that one wallet or another is totally safe. Hackers are pretty clever and determined, and keyloggers, screenloggers etc are rife. You can stay safe from keyloggers with a password manager like LastPass
Mobile wallets are also available for download from Play store
Unfortunately, recently there have been reports of Trojans and other exploits contained in Android and smartphone Apps, including malicious code in 'Price Tickers' - so always 'Google' the App before you install it, and check the forums for recommended and suspect apps. Better still, If you don't need the app, just don't install it.
Remember - A weak or duplicated Password is worse than useless !
For now - the best single thing you can do to secure your Bitcoin is to concentrate on :
Password Protection! NEVER use the same password on more than one site. You may end up giving a scammer access to all your stuff. So now they have your Bitcoin, and passwords to all your online wallets, exchanges and more!
Always - Check the sites SSL certificate and https before you enter details. If the site has no SSL or https on it's registration or login page, then your account is probably already compromised and you may easily lose whatever you have in there. Insist on encryption.
Also, if available on a site you are registered on, use 2FA authentication such as google authenticator. 2FA means Two factor Authentication, and even if someone has your other login details, without this, they won't get in. A good alternative to Google Authenticator is Winauth.
The badbitcoin team
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