Bitcoin Advice

This is a discussion on Bitcoin Advice within the Cryptocurrencies forums, part of the Markets category; I've decided to take the plunge with BTC; I'm a bit of a newb although I've done a bit of ...

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Old Mar 20, 2015, 1:17am   #1
Joined Jan 2015
Bitcoin Advice

I've decided to take the plunge with BTC; I'm a bit of a newb although I've done a bit of research.

To buy the BTC, I've decided to use Kraken as the exchange (first on google rank!) and so I guess they must have some credibility.

The bigger question is that of an offline wallet?

According to: https://bitcoin.org/en/choose-your-wallet, there are 6 to choose from:

Bitcoin Core, Armory, Electrum, mSIGNA, MultiBit, Green Address - all of which have a weakness of some sort.

(My general approach for BTC is to just buy a few and hold them. If BTC goes global, I'll be happy, if not, and BTC becomes obsolete, no big loss.)

So, let's suppose I chose Electrum, which seems to be one of the easier ones to use.

If I download the wallet to a computer, can I then move the BTCs to an external HDD? Or, do I have to store them only on the computer? It's just that I have a netbook I don't use much with Windows 7 starter and thought I could use that. The question is, what happens if the HDD on the netbook fails, do I lose the BTCs?

I'm also a bit unclear about BTC addresses? When I buy the the BTCs on Kraken, for example, I have to give an address from my offline wallet? How is the address generated?

Thanks in advance.
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Old Mar 21, 2015, 6:56pm   #2
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Create an account with Bitstamp and leave your Bitcoin with them. I have been with them for around 3 years now and they have proved to be trustworthy - I have upwards of 30 Bitcoins with them at any given moment.

They will be safer than storing in a cold wallet. If you lose your HDD, or if someone gives your computer a bath - you'll lose them.

The only cold wallet I have used is btcQT which I downloaded a couple of years ago. It was sweet and I never had any problems with it.
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Old Mar 24, 2015, 12:19pm   #3
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asimpleplan started this thread Mmmm, not sure any exchange can really be trusted TBH regardless of their good intentions - all it takes is one bad egg at the company and the BTCs are all gone. Better to stick with the 'hiding under the mattress' approach just to be sure.
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Old Mar 24, 2015, 12:26pm   #4
 
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Dont hold bitcoin

Quote:
Originally Posted by asimpleplan View Post
I've decided to take the plunge with BTC; I'm a bit of a newb although I've done a bit of research.

To buy the BTC, I've decided to use Kraken as the exchange (first on google rank!) and so I guess they must have some credibility.

The bigger question is that of an offline wallet?

According to: https://bitcoin.org/en/choose-your-wallet, there are 6 to choose from:

Bitcoin Core, Armory, Electrum, mSIGNA, MultiBit, Green Address - all of which have a weakness of some sort.

(My general approach for BTC is to just buy a few and hold them. If BTC goes global, I'll be happy, if not, and BTC becomes obsolete, no big loss.)

So, let's suppose I chose Electrum, which seems to be one of the easier ones to use.

If I download the wallet to a computer, can I then move the BTCs to an external HDD? Or, do I have to store them only on the computer? It's just that I have a netbook I don't use much with Windows 7 starter and thought I could use that. The question is, what happens if the HDD on the netbook fails, do I lose the BTCs?

I'm also a bit unclear about BTC addresses? When I buy the the BTCs on Kraken, for example, I have to give an address from my offline wallet? How is the address generated?

Thanks in advance.
It's not safe to be held online BY ANY EXCHANGE. Nor is it practical to hold in cold storage. Our advice to all our clients is to trade it as a CFD, not to own the underlying or to use the exchanges which are being targeted by hackers. If you want to hold the coin as an investment here are some reasons why you should not:

http://www.bigdatascience.ie/blog/20...ng-bitcoin-bad

Best,

Alan
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Old Mar 24, 2015, 2:05pm   #5
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asimpleplan started this thread OK, I have a basic idea of CFDs but I don't have trading experience with them. Obviously, that'd increase one's leverage and exposure to BTC price moves.

Also, how would you go about hedging BTCs? Whether I buy BTCs outright or use the CFDs, the long term aim would be to go long but of course I'd need to safeguard my position.

Sorry, I'm a bit of an amateur but hopefully getting there.
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Old Mar 24, 2015, 2:20pm   #6
 
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Hedging a highly volatile underlying is inadvisable and Bitcoin is highly volatile, the re-hedging would cost more than any likely profit.

The likely move in digital currency is that the central banks will create a EURCoin, USDCoin... of their own which they are licensed to swap for EUR/USD making BTC essentially worthless so it's not going to be long term buy asset you want to hold on to.

Check out coinarch.com for information on trading the currency and the options available, they are one of the more professional systems out there but do not hold BTC in any quantities.
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Old Mar 24, 2015, 2:47pm   #7
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asimpleplan started this thread OK, thanks for the advice.

"The likely move in digital currency is that the central banks will create a EURCoin, USDCoin... of their own which they are licensed to swap for EUR/USD making BTC essentially worthless so it's not going to be long term buy asset you want to hold on to."

I'm not sure. The notion of a freely floated international currency independent of borders is not something that'll disappear any time soon. Given the endless list of frauds and hacks with BTC, and the fact the market keeps returning to support it, it strongly suggests there's an appetite for BTC even though that support may come from dubious sources (like that article suggested), but then again, all money is tainted somehow (20% of world trade is the black market and that's probably a conservative estimate).

OTOH, http://www.coindesk.com/breaking-uk-...encies-report/ the language of the report is interesting, where the emphasis is digital currencies as opposed to BTC.

Nonetheless, you're right about exposure to BTC, if I just want to buy BTCs from an investment point of view, CFDs are obviously a smarter way to go.

Also, what about spreadbetting BTCs? How exactly does that differ from CFDs?
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Old Mar 24, 2015, 3:05pm   #8
 
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Quote:
Originally Posted by asimpleplan View Post
OK, thanks for the advice.

"The likely move in digital currency is that the central banks will create a EURCoin, USDCoin... of their own which they are licensed to swap for EUR/USD making BTC essentially worthless so it's not going to be long term buy asset you want to hold on to."

I'm not sure. The notion of a freely floated international currency independent of borders is not something that'll disappear any time soon. Given the endless list of frauds and hacks with BTC, and the fact the market keeps returning to support it, it strongly suggests there's an appetite for BTC even though that support may come from dubious sources (like that article suggested), but then again, all money is tainted somehow (20% of world trade is the black market and that's probably a conservative estimate).

OTOH, http://www.coindesk.com/breaking-uk-...encies-report/ the language of the report is interesting, where the emphasis is digital currencies as opposed to BTC.

Nonetheless, you're right about exposure to BTC, if I just want to buy BTCs from an investment point of view, CFDs are obviously a smarter way to go.

Also, what about spreadbetting BTCs? How exactly does that differ from CFDs?
I agree that Digital currencies outside state control will continue, check out sidechains which will be an interesting technology in the future.

Google BTC at IG and you will see their offering for CFDs and Spreadbets.
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