Newbie questions crypto thread

Roosh

Cardinal
Orthodox
For this thread, explain things like the questioner is 5 years old.

First question: I'm using Electrum for Bitcoin. What's the best way to set the transaction fee to aim for low cost while ensuring the transaction eventually goes through? I'm in no rush.

There's this page that suggests anything above 0.0001 mBTC/byte (10 satoshis/byte) will go through:

https://bitcoinfees.earn.com/

Is therefore setting a fee of 0.0001 mBTC/byte safe?
 

Leonard D Neubache

Owl
Gold Member
I appreciate you making this thread and I hope some of the gurus will contribute.

My personal questions are these.

a) Is it reasonable to run all your trading through a smartphone.
b) Have the markets become buy/sell intensive to make money or can you still drop some cash in something like bitcoin, forget about it and see good returns in 6 months to a year.

I know nobody has a functioning crystal ball but I'd happily settle for a best guess.
 

kiryu

Sparrow
Gold Member
Roosh said:
What does "sweep private key" mean in the contact of a wallet app like Electrum?

It means if you had a private key saved on Paper from a previous wallet (i.e. a backup) which you lost, you can "sweep" it on Electrum to restore the coins from that wallet to this one.
 

Roosh

Cardinal
Orthodox
Olav said:
Roosh said:
What does "sweep private key" mean in the contact of a wallet app like Electrum?

It means if you had a private key saved on Paper from a previous wallet (i.e. a backup) which you lost, you can "sweep" it on Electrum to restore the coins from that wallet to this one.

Without incurring any transaction fees, correct?

Without the private key remain the same? I'm guessing not since you have to create a new wallet on Electrum to use the sweep option.
 

Pinocchio

Woodpecker
Leonard D Neubache said:
I appreciate you making this thread and I hope some of the gurus will contribute.

My personal questions are these.

a) Is it reasonable to run all your trading through a smartphone.
b) Have the markets become buy/sell intensive to make money or can you still drop some cash in something like bitcoin, forget about it and see good returns in 6 months to a year.

I know nobody has a functioning crystal ball but I'd happily settle for a best guess.

Bitcoin is up about 1400% this year.
 

pants

 
Roosh said:
Olav said:
Roosh said:
What does "sweep private key" mean in the contact of a wallet app like Electrum?

It means if you had a private key saved on Paper from a previous wallet (i.e. a backup) which you lost, you can "sweep" it on Electrum to restore the coins from that wallet to this one.

Without incurring any transaction fees, correct?

Without the private key remain the same? I'm guessing not since you have to create a new wallet on Electrum to use the sweep option.

Lets say bitcoins are locked behind doors. Only way to move them is if you have they key, aka "private key" behind a door "public key".

Someone gives you a key so you have access to the bitcoins behind the door.

You can import these bitcoins by addings this key to your keychain or wallet as its called in crypto.

However, you have no reason to know if he have other keys. So the safest thing would be to move them to a place where you know you are in control of the keys.

This operation within crypto would be called "sweeping". You are emptying one address, and moving them to an address you are in control.

Import = add a key to a wallet, bitcoins stay where they are.
Sweep = add bitcoins to a wallet, bitcoins gets moved form one address to another.

AFAIK
 

MikeS

Pelican
Royalist and Legitimist said:
What is your preferred online exchange for bitcoin trading?

GDAX for BTC/EUR (or USD, GBP) and ETH/EUR, ETH/BTC. They also have Litecoin pairings with fiat and BTC.
It's the Coinbase exchange so crypto or fiat can be deposited and withdrawn instantly at no fees between Coinbase and GDAX.
There are also no trading fees if you only use limit orders.

Bittrex for a pretty comprehensive list of altcoins.

(Disclaimer: I've only been in crypto for a couple of months.)
 

Dvorak

Sparrow
pants said:
Roosh said:
Olav said:
Roosh said:
What does "sweep private key" mean in the contact of a wallet app like Electrum?

It means if you had a private key saved on Paper from a previous wallet (i.e. a backup) which you lost, you can "sweep" it on Electrum to restore the coins from that wallet to this one.

Without incurring any transaction fees, correct?

Without the private key remain the same? I'm guessing not since you have to create a new wallet on Electrum to use the sweep option.

Lets say bitcoins are locked behind doors. Only way to move them is if you have they key, aka "private key" behind a door "public key".

Someone gives you a key so you have access to the bitcoins behind the door.

You can import these bitcoins by addings this key to your keychain or wallet as its called in crypto.

However, you have no reason to know if he have other keys. So the safest thing would be to move them to a place where you know you are in control of the keys.

This operation within crypto would be called "sweeping". You are emptying one address, and moving them to an address you are in control.

Import = add a key to a wallet, bitcoins stay where they are.
Sweep = add bitcoins to a wallet, bitcoins gets moved form one address to another.

AFAIK
Yes.

Public key = your address
Private key = "The key to the house" --> sufficient to retrieve your public key
Wallet = software that handles management of keys, transfers etc...

A sweep will lead to a transaction cost because you are transferring fro one address to another.
Not all wallets allow you to import a private key though. I know you can do it in blockchain.info.
 

villageindian

Sparrow
Gold Member
Here is a primer on using Electrum wallet. The only issue with Electrum is to NOT use it on a public computer as it may have a key logger installed to track every keystroke.

If you have the money, consider getting a hardware wallet like Trezor or Ledger Nano S which is much safer and secure. Even if the drive breaks, you can restore it onto a new Ledger quickly.
 

villageindian

Sparrow
Gold Member
Leonard D Neubache said:
I appreciate you making this thread and I hope some of the gurus will contribute.

My personal questions are these.

a) Is it reasonable to run all your trading through a smartphone.

Assuming you're doing this through an exchange, you can do this via a smartphone. But ensure that the exchange supports 2-factor authentication to verify money transfer and account transactions. Once you complete the transaction, you can consider transferring it to a hardware wallet for security.
 

Dvorak

Sparrow
villageindian said:
Here is a primer on using Electrum wallet. The only issue with Electrum is to NOT use it on a public computer as it may have a key logger installed to track every keystroke.

If you have the money, consider getting a hardware wallet like Trezor or Ledger Nano S which is much safer and secure. Even if the drive breaks, you can restore it onto a new Ledger quickly.
I second that. Get a hardware (HW) wallet like the Trezor or Ledger Nano S upfront. The Ledger is pretty cheap (got mine for 70 euro including transport) and does the job... It's the safest option by far and will give you ease of mind. Trezor will ship a new device (model T) at the start of next year, so if you want to get the latest and greatest, you can wait a bit but will be more expensive as well (150 euro).

I advice everyone to take a couple of days and study up on computer safety. Cyber crime will grow very hard the coming years and everyone is at risk, especially if you have crypto assets and you aren't that computer-savvy. A lot of people are getting hacked now. I haven't heard of anyone that uses a HW wallet that got hacked.
 

redonion

Woodpecker
What is the technology behind hardware wallets and how they recover your bitcoins?

I have a friend who physically lost his Trezor, but was able to recover all of his coins via his 30-word passphrase and a new Trezor. This makes me think that the coins aren't physically stored on an individual Trezor, and there must be some central registry somewhere for him to do the recovery. If this is true, doesn't this contradict the security features of a hardware wallet? What would happen if Trezor closed shop and went out of business?
 

pants

 
they are stored cryptated, only to be unlocked with a PIN.
The passphrase 30 word will generate a set of addresses.
There is no central storage.
Lose your trezor, you are safe with your backup.

Lose both, and you lost your coins
 

Noir

Pelican
Gold Member
Leonard D Neubache said:
a) Is it reasonable to run all your trading through a smartphone.

I am averse to using smartphones apart from checking my balance (will explain later).

Smartphones are off-putting because:
- I can't fit as much information on a mobile phone screen as a monitor/laptop screen
- It takes longer because it's easier to do on the computer
- Most exchanges don't have apps
- I don't feel technologically comfortable on a smartphone, my PC has a bunch of measures against phishing, malware, etc. that my smartphone probably doesn't have
- I wouldn't even jerk off on my smartphone so why use it to transact high amounts of money?

If you just buy some BTC/ETH or whatever tickles your fancy, you won''t need to use a smartphone, you will just be checking prices.

I use my smartphone to check my balances that I input myself (no transactions occuring) on an app such as Blockfolio or Delta. That just lets me put in x amount of BTC, y amount of ETH and track it over time. They have the grand majority of coins and it's easier to just open the app and have the info appear instead of a laptop or whatever.


b) Have the markets become buy/sell intensive to make money or can you still drop some cash in something like bitcoin, forget about it and see good returns in 6 months to a year.

It's a bit of both to be honest.

You could invest in certain currencies/coins that are underpriced and sell them after they make a decent profit but it's generally speculation.

Trying to day-trade is tough considering you're going up against whales (people who have enough volume and $$ to drive prices up or down for their profit) or trading bots which automatically set buy and sell walls to slow down or increase momentum.

This is a difficult speculation to make. If I answered this a month ago, I would tell you that I think 2018 will see growth in other cryptocurrencies which may beat BTC on a %.

I still believe this but good ol' BTC is doing well. People overestimate the penetration of BTC because I think that anyone who is financially savvy will buy in sooner or later. Thing is, financially savvy people aren't exactly in high supply as a lot of them don't have money to invest in BTC.

You can definitely just hold BTC with confidence considering:

- its gains aren't always mutually exclusive to other cryptocurrencies and trading due to it's sheer market cap %

- it's outperformed trading and holding other currencies thus far in the past 6 months; your portfolio would have a higher % ROI if you just held BTC over the past 6 months than the majority of coins. e.g. ratio of BTC to ETH/LTC/XMR

- most of the fiat entering the cryptocurrency market is to Bitcoin and gives it brilliant liquidity and a lot of buying power to drive price up. A lot of newcomers are impatient and don't bother to time an entry or look at cycles.

- BTC is deflationary. There will be 21 million BTCs ever mined, we are currently at approximately 16.7 million mined so far. The reward that is 'mined' is halved every 4 years. Given that it's demand is increasing and it's supply is increasing, theoretically it makes sense. All BTCs will be mined by 2140.

There's a few more reasons but you could definitely just hold BTC if that's all you want to do.

That being said, this current growth is due to BTC 'overcoming' internal politics between mining groups, certain standards they aimed for, disagreements and a whole bunch of drama.

As it's a 'small community' its scrutinzed much more than any other market (commodities, bonds, stocks whatever) that it's price can fluctuate a lot.

A lot of the mining 'cartels' also have a lot of weight to throw around and this is unhealthy for the future of it. I read an article claiming that all mining will be centralized within 2 or so years given the current trajectory. It's the climate change of Bitcoin.

There's plenty of interesting and fantastic technologies out there so it's worth a research as you could hold ETH, NEO, XMR or a whole array of other things instead.

BTC is the original gateway drug though and it's price will only go up on a long enough scale. There's lot of talks of a bubble forming (within a bubble even) so perhaps look at the prices and consider if it's reasonable or not. Don't put money into it that you're not willing to lose.

I'm not sure of your familiarity with this topic so let me know if the above makes sense.
 

yaku

Sparrow
pants said:
they are stored cryptated, only to be unlocked with a PIN.
The passphrase 30 word will generate a set of addresses.
There is no central storage.
Lose your trezor, you are safe with your backup.

Lose both, and you lost your coins

I have a Ledger S, but am looking at getting an encrypted USB for files and other stuff that I want protected. Is there a danger of keeping a 30 word seed on that encrypted USB?

https://www.kingston.com/us/usb/encrypted_security/IKS1000
 

pants

 
When you open up your seed phrase on a USB in plain text, if someone are spying on your screen, they will then see it.
Thats why many recommend to keep the seed phrase analog.
Its a security feature where you need both the seed phrase and a password to restore a backup of a wallet.
Thats gotta be very secure. Biggest risk with this is you forget your password. Or you lose access to the seed phrase.

You could store the seed phrase in two locations though. So even if your house burns down, the seed phrase is still stored in another location.

Its debatable whats the best security precautions.

If you chose to go the digital way, encrypt it with VeraCrypt, store it on multiple locations. Dropbox / Google Drive.
If you ever need to open this file, ill recomend to do it on a system that has not been compromized. Clean linux installation.
Offline decryption.


Too secure, risk of locking yourself out.
Not secure enough, someone get access to it.

This is just my thoughts, securtity expert might think differently.
 
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