For those of you looking to get rich on bitcoin, PLEASE keep reading. I have spent the last few weeks studying, experimenting with, and discussing the implications of this new and excitable revolution in currency and I want you to get the best information available to you. The result could make you the next bitcoin billionaire, or leave you flat broke.
Being that Bitcoin is getting so much attention right now and its an open source currency, its the perfect opportunity to lay some free knowledge on ya’ll this week! If this is your first experience with bitcoin or cryptocurrency, strap in! You’ve got some catching up to do!
Bitcoin was created by an anonymous cryptographer working under the name “Satoshi Nakimoto,” who originally posted his revolutionary idea surrounding “The Blockchain” to a forum on reddit. While there is speculation today about who that might be, it is still unclear whether we have discovered his true identity.
In a nutshell, the blockchain is the network of transactions recorded on digital ledgers much like a bank functions, only this network is made up of hundreds of thousands of computers completing “Hashes” or calculating tasks in order to encrypt each transaction. This makes every exchange seemingly impossible to hack, since the information is passing through thousands of computers instead of remaining in a centralized hub. It also makes purchases almost impossible to trace, leading us to one of Bitcoin’s biggest adversaries… the government!
Bitcoin got a lot of press in the beginning when the government decided to lock up a 26 year old entrepreneur named Charlie Shrem who had started the company BitInstant. At the time it took around three days to purchase bitcoin due to its Japanese roots and processing time, and he decided to buy a large quantity for himself to resell in the US instantaneously. Because of this, websites like Silk Road began to emerge allowing black market transactions to happen on a larger scale without repercussion. When SilkRoad was shut down by the FBI, they came after Shrem full force, holding him accountable for the crimes committed using bitcoin he had simply made more available. This is akin to a bank being held accountable for each person who cashes a check and proceeds to buy drugs with that money, yet not a single schezy banker has been held to this standard… not even during the housing market crash that left thousands of families homeless due to bankers encouraging them to buy into unstable mortgages.
What Smart People Are Saying
“Stay away from it, It’s a mirage, basically. [Bitcoin is] a very effective way of transmitting money, and you can do it anonymously and all that. A check is a way of transmitting money, too. Are checks worth a whole lot of money just because they can transmit money?” -Warren Buffet
“My opinion on Bitcoin is, I mean I think Bitcoin is probably a good thing. I think it’s primarily gonna be a means of doing illegal transactions. But that’s not necessarily entirely bad. You know, some things maybe shouldn’t be illegal.” – Elon Musk
“Bitcoin is exciting because it shows how cheap it can be. Bitcoin is better than currency in that you don’t have to be physically in the same place and, of course, for large transactions, currency can get pretty inconvenient.” – Bill Gates
Want free bitcoin and other cryptocurrency? Faucets are a way to earn small amounts of cryptocurrency by completing tiny, often monotonous tasks. They can include everything from watching ads to entering “Captchas”, and provides a slow but decent way to break into the market. These are the main faucets I have found which make it simple to get started, and give you killer bonuses! They all deposit into the same wallet at Coinpot. This is VERY useful as you can earn from the faucets listed below and convert each currency to the one you want to invest in without fees and instantly!
MoonBitcoin – Earn Free Bitcoin
MoonLitecoin – Earn Free Litecoin
MoonDash – Earn Free Dash
MoonDogecoin – Earn Free Dogecoin
BitFun – Play games, or just leave your browser open to earn bitcoin.
BonusBitcoin – This Bitcoin faucet pays well, but is a little ad heavy.
With Moon-Dash/ Doge/ Litecoin / Bitcoin you also get a “loyalty” bonus which can really ad up if you use the faucet at least once per day. In my opinion the two best are actually Freebitco.in and FreeDogeco.in. Their faucets are pretty decent although they have a small withdrawal fee, but you also earn reward points that can be exchanged for tons of things, and tickets into their bitcoin lottery system which I have seen give out over 2 BTC on average. Freebitco.in also have an app that makes things a little easier! Check them out HERE.
A very similar service offering a lottery system and faucet for Ripple (XRP) can also be found here at Faucetco.in.
Just like with any currency, you will need a secure place to store your funds. There are a few good free options out there like Freewallet, which let you store and send your currency securely through an ios/ android app… But its always a good idea to make a paper wallet for security!
CoinBase: This is the most famous wallet out there. They charge a small fee depending on how much you invest but allow you to use your bank account or cards to invest in cryptocurrency almost instantly. They’ve got some bad press in the past for security issues, but they seem to have made up for that with increased security are still the go-to choice for those looking to enter the world of cryptocurrency and as of December 2017 became the #1 app downloaded in the iTunes app store! Use this link to get $10 free when you invest your first $100 with Coinbase.
QoinPro: While they are still building this out to its full potential, it is a fully functional wallet that allows you to earn a free percentage of multiple cryptocurrencies daily just for signing up! They give you free Bitcoin, Neo, etc.. Its a great way to get started without any investment. Make an account and start racking up the rewards!
The best place to keep your cryptocurrency investments is actually in their intended desktop wallets. You can buy hardware wallets like the Ledger Nano S Cryptocurrency Hardware WalletS, but make sure you order directly from the manufacturer to ensure security.
There are only 21,000,000 Bitcoin that will ever be in existence. This is good, as it makes the currency a scarce resource, which can therefor be earned or “mined” with labor just like gold. Mining is the process that bitcoin runs on, where thousands of “miners” on the bitcoin network are confirming each transaction as valid before passing it on to the next and earning a small reward. This originally allowed anyone to use their hardware rig or computer to complete each ” hash within the block, allowing blockchain to function by validating each ledger. Complete enough hashing functions, and you are rewarded with “Satoshi” = a fractional amount of newly mined bitcoin. Because of the limited amount of bitcoin available combined with the volatility of the market, this amount fluctuates quite often.
You won’t get very far trying to mine on a normal computer these days, and the computing power needed and the same goes for your ipad/ iphone. Unless you have the cash to buy a decent mining rig and the knowledge to set it up, I wouldn’t suggest using this method… But if you want to give it a shot, Coinpot has a mining feature that works decently enough. All you have to do is hit the “start mining” button next to your coin of choice and you’re good to go.
Eobot – I have watched more than a few videos about this cloud mining platform and they all say something similar. Please do not use this platform to store or buy cryptocurrency. You might want to use your Coinpot Faucet earnings to transfer over some Dogecoin, buy up some GHS (cloud computing ability) and start mining bitcoin using cloud-based miners. ***For what its worth, I did find a comparison video that proved Bitcoin was the best currency to mine for the value on this site.
Cryptokitties – Cryptokitties launched late November and is one of the first collectable gaming platform of its kind. Based on the cryptocurrency Ether, you can basically buy “kitties” that with unique traits and breed them with others to make new kitties. All you have to do is install their wallet browser metamask, move over some etherium with coinbase, and buy yourself a kitty. Among their rare traits, kitties are ranked on how fast they can breed and their Generation number; higher generation numbers decrease in value as they deviate from the original line. While this is a new technology, there are already tons of people investing in cryptocurrency this way. Don’t believe me? Check this out. You’d be surprised to find some of these rare kitties are selling for well over $100,000!
Where To Buy CryptoCurrency
Here we are… the part you’ve probably been waiting for.
Instead of buying directly off of Coinbase (After your first $100 transaction to get your free $10 credit), I would recommend linking your Coinbase account to GDAX to buy and transfer your currency to avoid the Coinbase fees (GDAX fees of 0.25% may still apply). GDAX is essentially owned by Coinbase… so you are basically already using it if you have a Coinbase account. Only it allows you to buy Bitcoin, and many other alt-coins, without the Coinbase fees! Just hook up your bank account and you’re good to go. When you are ready to move into buying Altcoins, transfer your funds on over to Bittrex or my favorite trading platform, Binance!
Bitcoin And Taxes
As of December 2017, the US government is still trying to decide what regulations to put in place; as cryptocurrency evolves it will be interesting to see how this evolves. Currently the exchange of bitcoin is not defined by the IRS as a currency, but as an exchange of “property”… therefor they would like you to pay a capital gains tax on your earnings. While this completely goes against the decentralized mission of bitcoin, you can expect more attempts at regulation as the government scrambles to maintain some level of control over this economic revolution. My suggestion here would be to buy and hold, as the long term investments will have lower tax rates… I believe the requirements are one year and one day to qualify. It looks like they are scrambling to add new regulations with everything from trying to hit it with property taxes to taxing every transfer (such as from BTC to ETH) and beyond!
I would highly suggest you give the faucets a try and dip your toes in before taking the plunge. Don’t ignore the alt-coins! Think of each cryptocurrency as a solution to a different problem. While bitcoin is great, other currencies like Ripple are used for bridging the gap within the private sector and are starting to skyrocket in price as well. In fact while was writing this, the price of Litecoin jumped from $127 to over $340… so my $0.50 earned from a day of using the faucets above doubled overnight. I’ll be posting a followup post after the new year as well. If you have an experience to share or some knowledge to add please comment below. Good luck!
Fun Fact: If you would have invested $100 in bitcoin in 2010, it would be worth more than $72 Million today.