Step-by-step Bitcoin instruction for beginners. Bitcoin tutorials and descriptions for beginners

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If you have heard a lot about Bitcoin, but cannot understand what is so much noise around, then this step-by-step instruction is for you. Find out what Bitcoin is, what it is for and how to use it.

What is Bitcoin

Bitcoin is the world’s first cryptocurrency. And cryptocurrency is a program and, at the same time, a digital currency with several distinctive features.

  1. Accessibility and decentralization. The Bitcoin network is based on a distributed database (blockchain) that connects thousands of user software wallets.
  2. Lack of control. Bitcoin is not controlled by any specific company or person, or government agencies. No one can freeze a specific account, cancel a payment, etc. Even the fees charged for payments are not sent to the control center, but are distributed fairly among the miners that support the network.
  3. Anonymity. In a cryptocurrency network, dynamic addresses are used to transfer funds from user to user. Even after seeing this address, it is impossible to establish who it belongs to – using digital money does not require providing information about yourself, passport data, etc.
  4. Transparency. All transactions occurring on the blockchain are publicly available. This does not interfere with anonymity, since only addresses are visible, not personal data of users.
  5. High level of protection. The more the blockchain grows as new transactions are added to it, the more difficult it will be to crack. The power of the Bitcoin network today is 8-10 times the power of all supercomputers combined. To at least somehow control it, an attacker would need hundreds of millions of dollars and gigantic technical resources.

An important element of the cryptocurrency network is virtual coins, which do not exist in real life, but nevertheless they have value. You can make money (or go broke) on Bitcoins, you can buy goods and services for them, you can just store it as an investment.

Where to store Bitcoin

It should be understood that the coins themselves are not “stored”, because they do not exist. All information about incoming and outgoing transactions is stored, on the basis of which the current balance is formed. Special keys and addresses are used to access and manage funds. All this is controlled by special programs, and in some cases by devices – Bitcoin wallets.

Wallets

Cryptocurrency wallets are divided into several types:

✅  Desktop. These are programs for a computer or laptop that you need to download and install. Keys are also stored on the user’s device. These wallets include: Bitcoin Core, Electrum, Exodus, Jaxx, Lumi Wallet, Copay, etc. For example, this is how the Jaxx wallet interface looks like:

✅  Web versions. Internet sites that store keys on their servers. Their advantage is that you can log in from any device if you know the authorization data. Examples: Blockchain Wallet, Matbea, Luno, Coinfy, Coinfy, ArcBit, etc.

✅  Mobile. Typically heavily stripped down applications serving the most basic functions. Examples: Coinomi, JAXX, Electrum, Bither, Bitpay, Edge, etc.

✅  Hardware. Devices the size of a USB flash drive that stores information about access keys. Operations can only be performed by connecting the device to a computer, the rest of the time it does not connect to the Internet (as a result, it is invulnerable to most attacks). Notable manufacturers: Ledger and Trezor.

✅  Paper. A sheet of paper with keys printed on it. Due to the fact that it never connects to the Internet, it has the highest level of security, but is inconvenient to use. Suitable for storing long-term investments. There are services for generating private keys, for example, bitaddress.org.

The choice of a specific option depends on the goals pursued, as well as on the amounts that are planned to be stored in the wallet.

What is a private key

The private (private) key is a complex formula based on cryptographic methods and used to gain access to the user to their savings. Private keys are used in almost all cryptocurrencies, including Bitcoin, as a reliable protection against loss or unwanted third party access to money.

Private key features:

  1. Serves as the basis for drawing up a digital signature, which automatically signs all transactions on the network.
  2. It is encoded in several formats: WIF and WIF-compressed (“base58”), Hex, Base64. They differ in the number of characters, for example, in the Hex format, the private key consists of 64 characters (letters A-F, numbers 0-9). The format “base58” is often used: 52 characters long (letters “L” and “K”)
  3. Kept in strict confidence.
  4. Generated when the wallet is created.
  5. Cannot be mathematically calculated from digital signatures or public addresses, and is not transmitted in transactions.

An example of a private key in different formats:

What is a public key (address to receive)

But also another type of keys is still actively used on the network – public, radically different in its properties:

  1. Serves as the address for the wallet to which funds are transferred.
  2. Like the private key, the public key can be displayed in different encoding formats. Most often in the “base58” format and consists of 33-34 characters (letters of the Latin alphabet, except for the letters “i”, “I”, “O”, “o” in order to avoid confusion when writing). Starts with “1” or “3”.
  3. It is stored openly, can be transferred to third parties and posted on public resources.
  4. Generated based on a previously generated private key.
  5. It can be mathematically figured out if you know the private key.

An example of an address for receiving Bitcoin:

How and where to buy Bitcoin

Now that we have figured out what Bitcoin is and what basic concepts allow it to work, it’s time to move on to the economic part. Today, BTC is the most popular and expensive cryptocurrency, despite the huge number of altcoin followers. Therefore, you may well be interested in the question of where to get it.

Bitcoin is usually bought for long-term investments. Traders who make money on fluctuations in the rate of cryptocurrencies choose volatile promising altcoins.

Exchanges

A cryptocurrency exchange is a trading platform that supports exchange operations of cryptocurrencies against each other or for traditional money. In essence, it does not differ from ordinary stock or currency exchanges – it provides detailed information about rates, updated in real time, and supports an extensive trading toolkit.

Top cryptocurrency exchanges popular today:

✅  Binance. The most liquid marketplace in the world. The trading volume reaches USD 1 billion. The most promising cryptocurrencies are presented on the exchange, as there is a strict selection of coins for listing. Markets available: BNB, BTC, ALTS (altcoins), USD (stablecoins). You can replenish your account with cryptocurrency, there are no fiat accounts. But, since the beginning of 2019, it has become possible to buy Bitcoin, Ethereum, Litecoin using Visa / Mastercard bank cards. The trading commission starts from 0.1%, with an increase in turnover it decreases. Binance Chain launched its own blockchain network in April. The site was one of the first to conduct IEO (sale of tokens on the exchange). To use fiat (GPB, EUR), the Binance Jersey platform has been launched.

✅  EXMO. The exchange has been operating since 2013 and is a place for exchanging cryptocurrencies for fiat. Available payment systems and wallets: Advcash, Payeer, Yandex.Money, Qiwi, Perfect Money, Visa / Mastercard. Trading commission 0.2%. Order type: market and limit. 142 currency pairs are available. The minimum amount to deposit or transfer Bitcoin is 0.001 BTC.

✅  Huobi;

✅  The Localbitcoins Bitcoin exchange, which belongs to p2p (person to person) services, is very popular. This means that people are participants in transactions. The obligation of the exchange to monitor the fulfillment of the agreed conditions, i.e. act as a guarantor of every transaction. For this, a system of depositing funds with the seller before the exchange has been introduced. After successful payment, the Bitcoin exchange transfers them to the buyer’s account.

✅  Bitmex. The site is used for margin trading, i.e. with the provision of leverage. Deals can be opened for the sale and purchase of an asset. The minimum contract value is $ 1. The maximum leverage for Bitcoin is 100.

Instructions for working on the exchange

Procedure:

  1. To work on any exchange, you will need to create an account, confirm the registration email and set up security by connecting 2FA authorization to enter and conduct financial transactions.
  2. Balance replenishment. Depending on which exchange is chosen, you can make a deposit with fiat money or only cryptocurrency.
  3. Go to the trading terminal and select a currency pair.
  4. Studying the chart, history, current orders (order book).
  5. Making an order to buy or sell Bitcoin.

Exchangers

Cryptocurrency exchange services do not differ from traditional ones either. It is required to select the direction of exchange (for example, from Yandex.Money to Bitcoin), enter payment details, indicate the exchange amount and confirm the operation.

To select the exchanger with the best rate, the BestChange service aggregator is used. Examples of well-known exchangers:

✅  Prostocash;

✅  60cek;

✅  Ramon-cash;

✅  Platov;

✅  Baksman.

Guide how to work with exchangers

In any Bitcoin exchanger, you will need to do the following:

  1. Register now. Some services work without it, but we recommend creating an account for convenience and participation in the cumulative discount program.
  2. Select exchange directions. For example, Sberbank for Bitcoin.
  3. Fill out the exchange request form. Indicate the address to receive, the quantity and details of the wallet from which the payment is made.
  4. Check and confirm the operation
  5. Within the specified timeframe, make a payment to the exchanger, and click “I paid”.
  6. Within the scheduled time frame, the service will transfer the Bitcoins to the specified address.
  7. Wait until the transaction is confirmed by the miners on the network. On average, the process takes no more than an hour.

Payment systems

Popular payment systems, seeing the popularity of Bitcoin, are also beginning to provide the opportunity to buy and store it:

  1. Advcash allows you to buy Bitcoin directly from the wallet interface. To do this, you need to have a fiat account with the required amount, enter the wallet details. You can buy the following coins: Bitcoin, Litecoin, Zcash, Dash, Ripple, Ethereum, USDT:
  1. Epayments‘ multifunctional e-wallet also provides such an opportunity, and in addition to Bitcoin, you can buy a number of altcoins here. We recommend working through the DSX partner exchange.
  2. Payeer and Webmoney. Both services allow you to create a separate account for Bitcoins and, if necessary, transfer funds back and forth. A cryptocurrency exchange has been introduced to Payer since 2018.

How to receive or transfer Bitcoin from a wallet

In addition to buying or selling coins on third-party services, it is often necessary to transfer Bitcoins to another user or receive them to your wallet. Instructions on the example of a Blockchain web wallet:

  1. Log in to the site.
  1. Press the button “Send money” (Send).
  1. Specify the recipient’s Bitcoin wallet address.
  1. Specify the amount of the transfer.
  2. If necessary, adjust the commission – the higher it is, the faster the transaction will be. You can choose Regular, Priority or Customize Fee. In the latter case, we manually set the commission size, focusing on monitoring services, for example, bitcoinfees.earn.com.
  3. Click “Send Payment”.

In the Bitcoin network, transfers do not take place instantly, but in turn. The operation can take 2 hours or more, and maybe only 15 minutes if a high commission is set. Below we will describe how to check the status of a transaction if it hangs for too long.

To get Bitcoin to your wallet, just click “Get money” and specify the amount. The system will generate a special link where the payer can send money. You can also add a comment.

Instructions on how to find out the status of transactions

If your transaction gets stuck and you don’t know if it will ever be delivered, use one of the public services that provide information about all payments on the network.

For example, Blockchain.com. To check a payment, you need to enter its identifier (hash, Hash) into a line. The system will give detailed information, including showing how many blocks have already been collected for confirmation and how many are left.

Blockchain observers

A blockchain explorer is a website or application designed to read information from the blockchain of a cryptocurrency. Such resources appeared relatively recently; previously, it was rather difficult for an inexperienced user to find such information. Popular now are:

  • blockchain.com
  • blochkexplorer.com
  • live.blotsxofer.kom / bts /

And there are such resources for almost every single cryptocurrency taken. Services provide information such as data on transactions, blocks, smart contracts. Typically, information is updated in real time.

How to earn Bitcoin without investment

In addition to buying, if there are a number of ways to earn Bitcoin. Let’s start with those who do not require any investment from you (maybe time).

Cranes

Bitcoin faucet is a resource that distributes cryptocurrency for free in exchange for any actions or viewing ads. It should be said right away that you can make tangible money in this way only if you comply with a number of conditions: use 10-20 bitcoin faucets at the same time, constantly monitor them, collecting profits, and actively use the advantages of affiliate programs, that is, attract referrals.

The faucet issues a bonus once every 5-60 minutes, and this bonus is equal to 5-20 thousand satoshi, that is, millionths of Bitcoin. Notable BTC faucets:

✅  FreeBitcoin,

✅  Satoshihero,

✅  MoonBitcoin,

✅  BonusBitcoin,

✅  Adbtc TOP and others.

For example, on the FreeBitcoin tap, press “Roll” and get satoshi depending on the generated number. The minimum amount is 37 Satoshi or 0.00000037 BTC. The winnings can be increased using additional sections: MultiPly, Betting, Earn BTC, Lottery.

Games

Such services also do not imply serious profit; rather, they are a way to relax and have fun, while earning a small income. It’s important to choose a game based on real user reviews to determine which ones are actually paying.

Examples of games for 2022:

✅  Dice

✅  Chopcoin

✅  Coinbrawl

In some, the gameplay is rather monotonous, which makes them look like taps, only with a nicer interface. And some are actually fun to play. Try different options and find the best one for you.

Bitcoin games at Truecryptogames (Dice, Cockroach racing):

A selection of Bitcoin games (Bitcoin Dice, 4Clover Lottery, Alien Slots) on the SatoshiHero website:

Games on the Xether project:

Earnings with investments

If you decide to start working with cryptocurrencies at a serious level, then you need to know that you cannot do without investments. They are often so impressive that they pay off in months.

Mining

For the Bitcoin network to work, and users continued to send and receive transactions, they came up with mining. It is the miners who use their equipment to form blocks from transactions, confirming their authenticity. There is a fee for this procedure.

To earn Bitcoins from mining, you will need:

  1. Bitcoin wallet on any convenient platform.
  2. Equipment, which is below.
  3. Software.

Today, Bitcoin has such a high complexity of mining that in order to mine it, you need to purchase at least one, or preferably more, ASIC. This is a special device with very high power, designed to perform only one operation, but at the same time it makes this operation as efficient as possible. “Asiki” – expensive equipment, and investments are not immediately paid off. In addition, if the Bitcoin rate collapses, then the device will not even be sold, it will not be needed by anyone.

You don’t have to buy expensive equipment, but use cloud mining services. On such services, you only need to pay a contract for the required amount of power. Cryptocurrency accruals are usually made within a day. Popular cloud services are: IQ Mining (recommended), HashFlare, Genesis Mining.

Exchange trading

In this option, you don’t have to buy anything tangible – but you need to invest in a cryptocurrency on one of the exchanges. And then start trading, buying and selling coins at good times and earning on the difference in rates.

Experienced traders say that it makes no sense to come to the exchange with less than $ 1000. The use of platforms with margin collateral will help to significantly reduce this amount. However, it is always a risk. It is very easy for a beginner to burn out, even if you study the rules and nuances of cryptocurrency trading for a long time and persistently.

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