How to HODL bitcoin. Part 4 of the guide
How to HODL bitcoin. Part 4 of the guide

How to HODL bitcoin. Part 4 of the guide

By Alessio Salvetti - 8 Sep 2018

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Practice and theory

Crypto articles, guides, in-depth studies, supporters and denigrators debate in the media: the hunt for the expert brings to light ambiguous characters, who focus their praise and criticism exclusively on partial and often unfounded aspects of cryptocurrencies.

There are very few cases in which one hears about cryptocurrencies with full knowledge of the facts.

Even where there is recognized technical expertise, ergo a deep knowledge of the theory (which only a computer scientist who has been following the project and the community for at least eighteen months can enjoy), there is often a lack of a practical approach and, more generally, experience within an ecosystem where cryptocurrencies are a daily reality (which only ordinary people living in a community where the use is widespread can enjoy).

To understand what a cryptocurrency is and how it can evolve and mix with society, practice is strongly recommended: download a wallet, purchase crypto in several different ways, transfer money from an exchange to your wallet, make online purchases, and above all, spend a few hours (or a few days) in communities (such as the “Bitcoin Valley” in the province of Trento) where you can literally “live using Bitcoin” and connect with small traders that besides the theoretical, they engage in the practical part of cryptocurrencies.

Receiving, storing and transacting bitcoin (BTC)

Wallet. In order to receive, store and transact BTC you must use a wallet. The first step is to download and set up a wallet, which is (free) software created to store and make payments.

There are countless wallets recommended by Bitcoin‘s community with an in-depth analysis of the characteristics of each one.

It is initially recommended to store small sums using a wallet for smartphones:

  • Altana [Bitcoin wallet; Android].
  • GreenAddress [Bitcoin wallet; iOS, Android, Windows];
  • Eidoo [Multicurrency wallet; iOS, Android].

These applications do not require any personal data to access them.

By creating a new user profile, the application will provide a mnemonic, which are 12-24 real words that you must store and keep safely (backup), if you lose them, your funds are irretrievable. It is essential to keep the mnemonic (also called seed) in a safe place, preferably not online, because:

  • whoever is in possession of the mnemonic can access and transact the relevant money at any time from any device;
  • in case you lose possession of the device on which the application was installed, thanks to the mnemonic you can retrieve the funds by “reopening” the wallet on another device;
  • no one is in possession of the mnemonic, ergo there is no procedure of “password recovery”, so if you lose the “seed” there is no way of retrieving your crypto.

Once the application is installed, there are a few default settings (language, etc.) and then it is possible to use it immediately to receive and send money.

Receiving money is extremely simple: clicking on the “receive” section the wallet will generate a bitcoin address (an alphanumeric string) and the relative QR code: transmitting one of these data to another user (or to another wallet in your possession) the latter will be able to send money to you from their wallet.

To send money and make a payment you have to do the opposite: you must click on “send”, enter the bitcoin address of the recipient (or scan the QR-code) and enter the amount to be sent.

Exchange. If you do not have an activity it is unusual for individuals to be willing to send you BTC: the exchanges solve this problem. These are real currency exchange websites where you can buy BTC in exchange for fiat.

We recommend it:

Once you have created an account, you must provide personal information (depending on the type of exchange) and once you have unlocked some levels of security (tier) you can buy and transact cryptocurrency with SEPA transfers, credit cards, etc.. At any time you can also reverse the operation: convert cryptocurrency into fiat, and send the money back to your bank account.

Own, give, hodl. There are other ways to get bitcoin:

Once purchased, you can spend BTC on e-commerce websites, other online business or in real activities that accept BTC:

The high volatility of the market value of BTCs attracts many users who approach bitcoin not for an interest in the project but for mere speculative reasons, scaring those who, while considering the project interesting, keep a distance for fear of losing money:

  • protect your wallet;
  • the price of bitcoins is unstable;
  • payments with bitcoins are irreversible;
  • Bitcoin is not anonymous;
  • Immediate transactions are less secure;
  • Bitcoin is still experimental;
  • tax and regulatory costs.

Here’s some advice:

  • approach the system starting with small amounts and preferably avoiding trading (at least in the initial period);
  • never convert into cryptocurrency more than what you are willing to (and can bear financially) lose completely;
  • don’t sell BTC, spend it, it’s the best thing (amplify and strengthen the system by amplifying and strengthening your experience);
  • HODL! (if you have bought and the price has fallen, don’t sell but keep your position, and eventually spend later).

Business. For activities that want to start accepting BTC, there are different types of services created by companies in the industry:

  • proposes a guide to make businesses autonomous;
  • offers a basic product for accepting payments in BTC, connected to a range of services such as issuing invoices in 40 different  languages with prices in over 150 currencies, etc. ;
  • offers the product Inbitcoin Business, which includes an item useful for the sale of any product instantly from anywhere through a QR code or a link, usable on the spot, online or on flyers and promotional information.

In addition to the above, it is important to remember the transient nature of most of the information relating to cryptocurrencies, insofar as the evolution of the relevant technologies tends to make them obsolete, in rather ridiculous times.

A clarification to make is that all bitcoin transactions are tracked, but in principle, it is not possible (or at least extremely complex) to trace them back to the owner of the wallet where they are deposited;

Alessio Salvetti

Co-founder and board member (VP) of Bcademy, Alessio is also a partner and board member of Impact Hub Trentino, one of the 102 nodes of the worldwide network. After an experience as a professor of philosophy, he left teaching to coordinate a research team on the connection between neuroscience and economics. He then devoted himself to the actual creation of business. He's a business developer and consultant for many startups and passionate bitcoiner and expert in modelling and lean startup, he is a co-founder of Inbitcoin and responsible for the delivery of Bcademy products (CPO).

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