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Author Topic: Coinbase: your first Bitcoin wallet  (Read 1645 times)

wiser

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Coinbase: your first Bitcoin wallet
« on: April 15, 2015, 07:13:41 PM »
The first thing you need to jump into the world of cryptocoins is a Bitcoin address, and this tutorial is going to show you the best place to get one and take you through the steps.

But Bicoin is so 2009. I want DNotes, not Bitcoin!
It is true that there are many other coins besides Bitcoin, some of which will turn out to work even better and be worth more. However, Bitcoin has the prestigious position of being the first one, and for the time being, the most widely adopted. Bitcoin currently is the bridge between fiat money such as US Dollars or Euros and all other cryptocoins. If you want to buy any cryptocoin with your fiat money, with just a few exceptions you are going to have to buy Bitcoin first, then trade it for the alt coin of your choice. In order to do that you will need two things: a Bitcoin wallet and a way to link your wallet to your fiat bank account. Coinbase is your ticket to easily get both.

First things first, get your passwords in order
Coinbase will be one of many great websites from the cryptoworld that you are going to access with a unique password. If you don't have a system for securely storing and organizing your passwords, then please set one up now. You can get started with my tutorial How to secure and store your passwords.

Register your free Coinbase account
Not only is Coinbase a free service, they will actually give you a small amount of Bitcoin just for registering and verifying your account. Visit the Coinbase website to sign up for your account. You will see a simple form to complete right on the home page. You will fill in your first and last name, email address, and a password. Please visit Passwords Generator or similar site to easily generate a strong password.



Once you submit the form, Coinbase will send you an email with a confirmation link to verify your address.



When you click on the email verification link, Coinbase deposits 100 bits (approximately 2 cents) into your account.



Verifying your email address is the first step to completely verifying your account. The next step is to provide a cell phone number to enable two-factor authentication.



Two-factor authentication means that to log in to you account, you will have to enter a six or seven digit code sent to your smartphone in addition to your username and password. If you plan to keep large amounts of funds in your wallet, you should keep two-factor authentication on at all times. You can turn off two-factor authentication on your personal computer for thirty days at a time if you feel you don't need it.



The next verification step is to link your bank account. Select your bank from the options...



...then log in to your bank account from inside Coinbase to instantly verify and link your fiat bank account to your Bitcoin wallet.



Linking your fiat bank account completes your Coinbase account verification process. This triggers a new deposit of a dollar's worth of Bitcoin into your wallet. It also allows you to buy Bitcoin using your linked bank account.

How to get more Bitcoin
There are two ways you can get more Bitcoin into your Coinbase wallet. The obvious and most efficient way is to just spend the money and buy some. You can start with as little as five dollars, the price of a cup of coffee.

Before you do that, let's briefly explore the other way. Not only is it free, but it will help you get familiar with how Bitcoin works.

You will need to know your Bitcoin address. In the left margin, click on the [Tools] button. It will bring up your list of addresses. Coinbase automatically creates one or two addresses for you, and you can also create a new address anytime you want.



Your Bitcoin address is the string of letters and numbers that you provide to anyone who will send you Bitcoin. You want to be sure to highlight the complete string and use the [CTRL] + [C] key combination on your computer to copy it.

Next, register an account on Free Bitcoin by clicking on the [NEW USER?] button. Paste your Bitcoin address into the address field by using the [CTRL] + [V] key combination on your computer. Double check that you pasted the entire address properly.



Once you have your Free Bitcoin account registered, log in and solve the Captcha on the home page and then click the [ROLL!] button. A tiny amount of Bitcoin will be added to your account.



You can roll for more Bitcoin every hour.



When your account balance shown in the top right corner reaches a total greater than 0.00005460 you can request the site to send the Bitcoin to your address. You can also enable autowithdraw and have your balance sent once a week on Sunday.  You will then see that amount in your Coinbase account.

Free Bitcoin is what's referred to in the crypto world as a faucet. A faucet is a site which regularly dispenses a small amount of coin to whoever asks for it. There are quite a few Bitcoin faucets around and you could easily spend a lot of time visiting and collecting from them all. However the main point of a faucet is not to accumulate a lot of coin (you won't), but to use it as a way to gain familiarity with how cryptocurrencies move around and especially to gain some experience with using your address as a destination for cryptocoin. If you know the address works for small amounts of crypto sent from a faucet you will feel confident down the road in using your address to collect a much larger amount from either yourself or someone who owes you. You can use a faucet to test new addresses you acquire as you go. A couple other good faucets you can try are BTC-Faucet and Moon Bitcoin. Have fun with them.

Buying Bitcoin with Coinbase
Visiting the faucets will give you pennies worth of Bitcoin. To get an amount that you can more easily work with your best bet is to buy some, and you can do that very easily with Coinbase. You do not need to buy a large amount of Bitcoin. In fact, you should only spend fiat money on Bitcoin that you can afford to lose. I'm not saying you will lose it, but the cryptoworld is such that you need to treat it like a very high risk investment. I'll say it again: only spend what you can afford to lose.

Click on the [Buy/Sell Bitcoin] button in the left margin. Then in the [BTC] field, enter the amount of Bitcoin you want. A couple hundredths worth is a good amount to start with. The form calculates everything else, including the exact Dollar amount to be withdrawn from your bank account and the fees Coinbase takes.



When you submit the form you will get a confirmation window which will also tell you when you can expect to receive the Bitcoin and have your bank account debited. It does take a few days. While you're waiting you can keep hitting the faucets :)



When you get to the point where you want to sell Bitcoin, the process is similar, except that Bitcoin will be deducted from your Coinbase wallet and fiat will be deposited into your bank account.

Sending Bitcoin with Coinbase
At some point you are going to want to send your Bitcoin to another wallet. You will pay someone with Bitcoin or you will want to trade it for an alt coin such as DNotes on an exchange, or you will want to do something else with it. This will require you to send your Bitcoin to a destination address.

Click on the [My Wallet] button in the left margin. This will bring up a list of your transactions and you will also see a [Send] button in the top right corner. Click on the [Send] button. Copy your destination address and paste it into the "To" field. Enter the amount of Bitcoin you wish to send in the "BTC" field and click the [Next] button.



You will get a confirmation window. Check to make sure you entered everything correctly, then click the [Send] button and your Bitcoin will be on the way.



Depending on where you are sending your Bitcoin, it could take anywhere from ten minutes to an hour for the transaction to fully confirm and for your recipient to be able to use the funds.

Basic wallet functions
As you explore the Coinbase interface you will find that you can do a lot of interesting things with it far beyond the basics. But even with many advanced features, Coinbase allows you to easily do the basic functions you need to do with Bitcoin: receive it, buy it, sell it, and send it.


Found this tutorial helpful? Tip my DNotes vault: DoQA9sja4vzPwV2MtuNweCh1miw5qHF2xc
« Last Edit: May 22, 2015, 04:41:52 AM by wiser »
Want to know what's going on in my little corner of the Cryptosphere? Check out my blog: Creative Currencies  Latest post: I can do it better with Bitcoin... or at least smaller

Chase

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Re: Coinbase: your first Bitcoin wallet (under construction)
« Reply #1 on: April 15, 2015, 07:45:20 PM »

This is a great idea and thank you very much for ALL of your informative posts! :)

CryptoMoms

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Re: Coinbase: your first Bitcoin wallet
« Reply #2 on: April 17, 2015, 06:52:46 PM »
Excellent job wiser!


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