Welcome to the Bitcoin’s world. I gathered here some informations on how to start buying and trading some coins.
Get a bitcoin wallet.
The first thing you need to have, is your bitcoin wallet (or any other coin wallet). Wallets can be found under several forms: online on websites (not advised), hardware wallets (like ledger keys), on desktop.
It is not advised to keep all your coins online, if the website is compromised, you could lose everything. However, if you want to trade on a daily basis, you will have to keep that amount on exchange websites. But for long term hold, it is safer to get back your funds on your own private wallet.
Hardware wallets can be an option, they can be plugged on any computer on an USB port, and are very secure (choose one with a screen on it).
Desktop wallet, you will have to backup yourself the keys, but that’s the option I prefered. I am using https://electrum.org . It’s available for many platforms. Simple and secure.
Download electrum, create a new wallet, choose the standard/default option. Be sure to save the 12 words phrase, print a on paper: that’s the only to get back your wallet if ever your computer crashes. That’s VERY important. Also, you can protect your wallet with a password. Do it, it is safer if ever someone manage to hack your computer.
Once create, the interface is quite simple. You have the History, Send, Receive and Coins menu.
Each time you want to receive bitcoins, go to the receive menu, use a new address, and give it to who will send you the bitcoin. You can leave the requested amount empty.
Each time you want to send bitcoins, go to send, enter the recipient address, and use the default fees (or your transaction might be stuck forever). I also advise to use the following preferences:
it will allow easily to you the replace-by-fee option, and add more fees if ever the transaction does not get any confirmations. You can see the number of confirmation in the history tab. Usually the transaction is validated after 6 confirmations. (fees are given to the miners, they confirm the transactions on the blockchain).
Buy your first coins
There is many way to buy bitcoins, but I will describe only 2 websites that I often use with no problems.
Coinbase (use this link will give $10 on your purchase, and $10 for me as well). You can buy other coins there, Litecoin, ETH …). You need to validate your identity. You can pay by credit card, wire. Interface is very simple.
When you buy on coinbase, they create a wallet address for you. So if you want to send the bitcoins to your wallet, you will need to use your electrum wallet (create a receive address, and give it to coinbase). There is a menu for sending funds on coinbase.
You can use that menu to send bitcoins to coinbase, if you want to convert and withdraw some fiat (usd or eur).
https://bitit.io/ also allow you to buy bitcoins with a credit card. 700 EUR weekly limit (500 on coinbase). On bitit, they don’t create a wallet address for you, you need to send it directly to your electrum address. Don’t make mistakes, or your funds could be stuck or lost !
Keep in mind that it can take 10 minutes, or even 2 hours to have the transaction confirmed.
Send coins to an exchange site
If you want to start trading, you need to create your account on an exchange site. I’m currently using HitBTC and Binance. On both of them, navigate to your account/funds, and make a deposit. It will create an address, copy it. Now go to electrum, in the send tab, past the address, and choose the amount you want to send… After the confirmations, you should see the funds under your account.
With Binance, you can start trading immediately. With HitBTC, you need to go under your account, and transfer the bitcoins from your ‘main account’ to the ‘trading account’.
As mentioned above, you need to transfer your coins to the exchange site. To avoid huge delay and transfer fees, some would advise to quickly convert to LiteCoin (LTC), make the transfer, and convert back. The low fees on this money and the speed of the transaction may save you some panic.
When buying or selling, I would advice to never use the ‘buy at market price’ (or sell), if ever the price jumps a lot (pumped by some groups), you might end buying x4 the real price without any warning. Always use a ‘buy at limit’, or ‘sell at limit’.
On Binance, you could also use the stop-limit order. For example, if you see a huge increase, when will it stop ? Take your 30% profit now, or wait but maybe lose all ? If you set a stop-limit sell order, at 10% below the actual price, it will try to sell only if the price goes under the limit. I feel that it’s a good way to take profit. Sometimes, a drop occurs quickly …