Bitcoin is an open source software based payment network created by Satoshi Nakamoto. Bitcoin is a decentralized p2p currency, which means that there is no government or central authority controlling it. P2P stands for Peer to Peer which means that the network is run by individual people. The backbone of Bitcoin is the blockchain, which records every transaction, it prevents submitting fake transactions. Because it is permanent and there is a public record of everything, any user can view another transaction. You might be thinking that if anyone can see another transaction then how do people remain anonymous? If you never reveal your identity then you have a pretty good chance at remaining hidden, but say you make a large donation in your name with Bitcoin the chances of you being increase greatly. To increase your privacy, change Bitcoin addresses every transaction. Another plus of using Bitcoin is there are no fee’s regardless of where you send money to. By far the coolest part of Bitcoin is that anyone can create it, its called Bitcoin mining. All you need is a powerful gpu and a Bitcoin mining client and you can begin to mine Bitcoins. A word of advice that is very important – Bitcoin transactions are irreversible. So if you accidentally send Bitcoins to the wrong address you will most likely never see them again unless the owner of the address is very kind.
Have you ever wanted to become a Bounty Hunter? Now you can, while being paid in Bitcoin and remaining anonymous. Its called Bitcoin Bounty Hunter, it was created by Roger Ver who is also known as “Bitcoin Jesus”. He created the site because he was tired of victims being ignored and the criminals getting away because law enforcement was not putting 100% in. But where does the money come from? The bounty is funded by anyone, if you want to raise the bounty send some bitcoins to a bitcoin address listed on the bounties page. Roger Ver has also gave some money to fund some of the bounties, one of them is solving the Mt.Gox mystery, and another is solving who hacked Satoshi & Roger Ver emails. For each bounty there is background information, if your lucky and find the criminal you can claim your reward which amounts to a nice sum of money. Good Luck and Happy Hunting!
There are a few options when it comes to picking a Bitcoin client, some are better for security while others are better for ease of use. There are software wallets, hardware wallets and web wallets.
Bitcoin QT – One of the first Bitcoin clients, it’s a full client with lots of security features. The downside is it takes up a lot of space and uses a large amount of memory. I’ve never liked Bitcoin QT because of the incredibly painful loading time. But if you use the Armory client with this it makes it much more enjoyable to use.
Armory – An advanced client that requires Bitcoin qt to run. Adds even more security features including multiple wallets, paper backups and offline wallets. My most favorite feature of this client is the ability to create lifetime paper backups
Electrum – A lightweight client, it’s the fastest of all the desktop clients. It is very easy to use and it has a lot of features, it’s fully portable, you can recover your wallet with a seed, there’s no downtime because servers download the blockchain for you and if you want to be super secure you can use it offline.
MultiBit – A lightweight client very similar to Electrum. It is fast to connect and sync with the blockchain, as it only has to download a few megabytes of data instead of the usual 12GB. Fully portable, encryption keys are stored locally, it also supports different wallets under one “account” to help manage your money.
My Choice – My favorite Bitcoin Client has to be Electrum, its easy to use and easy to recover your bitcoins. The quick loading speed and no need to sync with the blockchain is the main reason.
Web Wallets – a word of advice, wallets and exchanges owned by a third-party can be insecure. An example is Mt.Gox, they were hacked and all their customers lost their bitcoins.
Blockchain – a web wallet that has many features such as paper backups, offline transactions and wallet backups to your PC. It is also very easy to use as and doesn’t require any software to run just login to your account from anywhere with an internet connection.
Coinbase – a web wallet and a Bitcoin exchange, its one of the best places to buy your Bitcoins and has great ratings. By far the best part of using Coinbase is that they are insured so if anything happens to them you wont lose any money. They also have a service called the Bitcoin Vault, the Vault is specifically designed for storing large amounts of Bitcoins for long-term use.
Circle – one of the newer wallets and Bitcoin exchanges, its my favorite place to buy and store Bitcoins. Like Coinbase they are insured so you can rest in peace. The best part is that Circle doesn’t charge any fees for buying or selling and its easy to buy and sell instantly unlike Coinbase. The only downside to Circle is that they are invite only. So if you can get invited its one of the best choices out there for ease of use and security.
My Choice – Circle; they have a very easy to use interface, there are no fee’s when it comes to buying or selling your Bitcoins. They have great customer support too, so if you have any questions they usually respond very fast. The greatest part is that they have insurance so you Bitcoins are safe even if Circle gets hacked. If your lucky enough to get an invite to they are giving out 10$ worth of Bitcoins which is quite nice if you want to test Bitcoin out.
I was using Coinbase – they were pretty good, but they don’t support debit cards and have a strange verification process which prevents me from buying and selling instantly which results in a 3 day delay.