11 Top Bitcoin Business Trading Tips

Bitcoin Business Trading Tips: If you want to know what is Bitcoin, how you can get it, and how it can help you, without floundering into technical details, this guide is for you. It will explain how the system works, how you can use it for your profit, which scams to avoid. It will also direct you to resources that will help you store and use your first pieces of digital currency. If you are looking for something even more in detail please check out our blockchain courses on bitcoin.

With Bitcoin’s price skyrocketing in the last weeks, a lot of new players are getting curious about this mysterious cryptocurrency, but only a few have the necessary knowledge to start trading like a pro. So, here are six Bitcoin trading tutorials that can help newbies get started. Take a look, learn the basics, and happy trading!

11 Top Bitcoin Business Trading Tips in Nigeria

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Read related Post, 50 Best Profitable Things to Do With Money Sitting in the Bank

1. Buying Bitcoins (the newbie version)

Unlike what most teachers think, Wikipedia is actually a good source of information, at least in Bitcoin’s case. The Bitcoin wiki gathers a lot of precious knowledge, with dozens of virtual pages fed by an honest community. This simple tutorial, for instance, is great to get you started.

11 Top Bitcoin Business Trading Tips

2. Bitcoin Day Trading

Learn how to “buy and sell Bitcoins in small amounts at exchanges for fun and profit” with this short tutorial. Although this article has a year and a lot has changed since then, it’s still a nice little tutorial.

3. Tutorial for Bitcoin trading through Mt. Gox

Although the Japan-based Mt. Gox is not the world’s biggest Bitcoin exchange anymore, it still has a lot of faithful users, so here’s a tutorial about the basic knowledge to successfully trade using this platform.

4. Bitcoin trading with USD using PayPal or a Credit Card

A useful tutorial with different sections and a video about some trading exchanges, both forex and traditional. Through this website, you can also have access to a different, but equally useful, guide entitled “Bitcoin trading methods compared”.

11 Top Bitcoin Business Trading Tips

5. Bitcoin Trading Review

A complete tutorial with basic information and several links to other pages you will want to read if you want to make money with cryptocurrency trading.

6. How to trade Bitcoins with fundamental analysis

A different type of trading tutorial that might interest some Bitcoiners: just take a look and check if that’s your case.

If you are the kind of person that would rather talk about Bitcoin trading, instead of reading about it, you can also visit the Bitcoin Trading forum, which has good tips about safe trading

11 Top Bitcoin Business Trading Tips

1. Bitcoin Transaction properties:

1.) Irreversible: After confirmation, a transaction can‘t be reversed. By nobody. And nobody means nobody. Not you, not your bank, not the president of the United States, not Satoshi, not your miner. Nobody. If you send money, you send it. Period. No one can help you, if you sent your funds to a scammer or if a hacker stole them from your computer. There is no safety net.

2.) Pseudonymous: Neither transactions or accounts are connected to real-world identities. You receive Bitcoins on so-called addresses, which are randomly seeming chains of around 30 characters. While it is usually possible to analyze the transaction flow, it is not necessarily possible to connect the real-world identity of users with those addresses.

11 Top Bitcoin Business Trading Tips

3.) Fast and global: Transaction is propagated nearly instantly in the network and is confirmed in a couple of minutes. Since they happen in a global network of computers they are completely indifferent of your physical location. It doesn‘t matter if I send Bitcoin to my neighbour or to someone on the other side of the world.

4.) Secure: Bitcoin funds are locked in a public key cryptography system. Only the owner of the private key can send cryptocurrency. Strong cryptography and the magic of big numbers make it impossible to break this scheme. A Bitcoin address is more secure than Fort Knox.

5.) Permissionless: You don‘t have to ask anybody to use cryptocurrency. It‘s just a software that everybody can download for free. After you installed it, you can receive and send Bitcoins or other cryptocurrencies. No one can prevent you. There is no gatekeeper.

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2. Where can I find Bitcoins?

First, we would recommend you read this in-depth guide for buying Bitcoin.

You can get your first bitcoins from any of these four places.

  • A cryptocurrency exchange where you can exchange ‘regular’ coins for bitcoins, or for satoshis, which are like the BTC-type of cents. Resources:  Coinbase and Coinsquare in the US & Canada, and BitBargain UK and Bittylicious in the UK.
  • A Bitcoin ATM (or cryptocurrency exchange) where you can change bitcoins or cash for another cryptocurrency. Resources: Your best bets are BTER and CoinCorner
  • A classified service where you can find a seller who will help you trade bitcoins for cash. Resources: The definitive site is LocalBitcoins.
  • You could sell a product or service for bitcoins. Resources: Sites like Purse.

Caution! Bitcoin is notorious for scams, so before using any service look for reviews from previous customers or post your questions on the Bitcoin forum.

3. How does Bitcoin work?

Without getting into the technical details, Bitcoin works on a vast public ledger, also called a blockchain, where all confirmed transactions are included as so-called ‘blocks.’ As each block enters the system, it is broadcast to the peer-to-peer computer network of users for validation. In this way, all users are aware of each transaction, which prevents stealing and double-spending, where someone spends the same currency twice. The process also helps blockchain users trust the system.

11 Top Bitcoin Business Trading Tips

Unlike traditional currencies, which are issued by central banks, Bitcoin has no central monetary authority. Instead it is underpinned by a peer-to-peer computer network made up of its users’ machines, akin to the networks that underpin BitTorrent, a file-sharing system, and Skype, an audio, video and chat service. Bitcoins are mathematically generated as the computers in this network execute difficult number-crunching tasks, a procedure known as Bitcoin “mining”. The mathematics of the Bitcoin system were set up so that it becomes progressively more difficult to “mine” Bitcoins over time, and the total number that can ever be mined is limited to around 21 million. There is therefore no way for a central bank to issue a flood of new Bitcoins and devalue those already in circulation.

11 Top Bitcoin Business Trading Tips

4. How can I store my bitcoins?

To see how the system works, imagine someone called Mary who’s trying out Bitcoins. She’d sign up for a cryptocurrency wallet to put her bitcoins in.

The Bitcoin Wallets

There are three different applications that Mary could use.

  • Full client – This is like a standalone email server that handles all aspects of the process without relying on third-party servers. Mary would control her whole transaction from beginning to end by herself. Understandably, this is not for beginners.
  • Lightweight client – This is a standalone email client that connects to a mail server for access to a mailbox. It would store Mary’s bitcoins, but it needs a third-party-owned server to access the network and make the transaction.
  • Web client – This is the opposite of “full client” and resembles webmail in that it totally relies on a third-party server. The third-party replaces Mary and operates her entire transaction.

You’ll find wallets that come in five main types: Desktop, mobile, web, paper and hardware. Each of these has its advantages and disadvantages.

11 Top Bitcoin Business Trading Tips

5. How do I buy and sell stuff with Bitcoins?

Here’s the funny thing with Bitcoins: there are no physical traces of them as of dollars. All you have are only records of transactions between different addresses, with balances that increase and decrease in their records that are stored on the blockchain.

To see how the process works, let’s return to Alice.

Example of a Bitcoin transaction

Mary wants to use her Bitcoin to buy pizza from Prince. She’d send him her private “key,” a private sequence of letters and numbers, which contains her source transaction of the coins, amount, and Prince’s digital wallet address. That “address” would be another, this time, the public sequence of letters and numbers. Prince scans the “key” with his smartphone to decode it. At the same time, Mary’s transaction is broadcast to all the other network participants (called “nodes”) on her ledger, and, approximately, ten minutes later, is confirmed, through a process of certain technical and business rules called “mining.” This “mining” process gives Prince a score to know whether or not to proceed with Mary’s transaction.

The transaction between Mary and Prince

11 Top Bitcoin Business Trading Tips

6. What is Bitcoin Mining?

Mining, or processing, keeps the Bitcoin process secure by chronologically adding new transactions (or blocks) to the chain and keeping them in the queue. Blocks are chopped off as each transaction is finalized, codes decoded, and bitcoins passed or exchanged.

Miners can also generate new bitcoins by using special software to solve cryptographic problems. This provides a smart way to issue the currency and also provides an incentive for people to mine.

The reward is agreed-upon by everyone in the network but is generally 12.5 bitcoins as well as the fees paid by users sending transactions. To prevent inflation and to keep the system manageable, there can be no more than a fixed total number of 21 million bitcoins (or BTCs) in circulation by the year 2040, so the “puzzle” gets increasingly harder to solve.

7. What do I need to know to protect my Bitcoins?

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Here are four pieces of advice that will help your bitcoins go further.

As you’d do with a regular wallet, only store small amounts of bitcoins on your computer, mobile, or server for everyday uses, and keep the remaining part of your funds in a safer environment.

  • Back up your wallet on a regular basis and encrypt your wallet or smartphone with a strong password to protect it from thieves (although, unfortunately, not against keylogging hardware or software).
  • Store some of your bitcoins in an offline wallet disconnected from your network for added security. Think of this as a bank, while you, generally, keep only some of your money in your wallet.
  • Update your software. For added protection, use Bitcoins’ multi-signature feature that allows a transaction to require multiple independent approvals to be spent.

Spending some time on these steps can save you money.

11 Top Bitcoin Business Trading Tips

8. What else do I need to know?

Protect your address: Although your user identity behind your address remains anonymous, Bitcoin is the most public form of transaction with anyone on the network seeing your balances and log of transactions. This is one reason why you should change Bitcoin addresses with each transaction and safeguard your address. You can also use multiple wallets for different purposes so that your balance and transaction history remain private from those who send you money.

Your confirmation score: As said, you receive a confirmation score of about 10 minutes before you make your purchase. Different wallets have their own reading.

Government taxes and regulationsGovernment and local municipalities require you to pay income, sales, payroll, and capital gains taxes on anything that is valuable – and that includes bitcoins. The legal status of Bitcoin varies from country to country, with some still banning its use. Regulations also vary with each state. In fact, as of 2016, New York state is the only state with a bitcoin rule, commonly referred to as a BitLicense.As shown in the Table above, zero is the least with the number 3 being the most reliable for average bitcoin transfers. If you’re sending or paying for, something valuable, wait until you, at least, receive a 6.

11 Top Bitcoin Business Trading Tips

9. What are the disadvantages of Bitcoin?

Bitcoin got off on the wrong foot by claiming an apocryphal person (or persons), Satoshi Nakamoto as its founder. Nakamoto has never been found.

Regarding more practical concerns, hacking and scams are the norms. They happen at least once a week and are getting more sophisticated. Bitcoin’s software complexity and the volatility of its currency dissuade many people from using it, while its transactions are frustratingly slow. You’ll have to wait at least ten minutes for your network to approve the transaction. Recently, some Reddit users reported waiting more than one hour for their transactions to be confirmed.

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Scams to watch out for

The four most typical Bitcoin scams are Ponzi schemes, mining scams, scam wallets, and fraudulent exchanges.

  • Ponzi ScamsPonzi scams, or high-yield investment programs, hook you with higher interest than the prevailing market rate (e.g. 1-2% interest per day) while redirecting your money to the thief’s wallet. They also tend to duck and emerge under different names in order to protect themselves. Keep away from companies that give you Bitcoin addresses for incoming payments rather than the common payment processors such as BitPay or Coinbase.
  • Bitcoin Mining ScamsThese companies will offer to mine outrageous amounts of bitcoin for you. You’ll have to pay them. That’s the last you’ll see of your money (with no bitcoins to show for it, either).
  • Bitcoin Exchange ScamsBitcoin Exchange Scams offer features that the typical bitcoin wallets don’t offer, such as PayPal/Credit Card processing, or better exchange rates. Needless to say, these scams leave you in the hang while they siphon your dollars.
  • Bitcoin Wallet ScamsBitcoin scam wallets are similar to online wallets – with a difference. They’ll ask you for your money. If robbers like the amount, that’s the last you’ll see of your deposit. The address, in other words, leads to them, rather than to you.

Of all of these, wallet scams are the most popular with scammers managing to pinch millions.

10. What are the advantages of Bitcoin?

The best thing about Bitcoin is that it is decentralized, which means that you can settle international deals without messing around with exchange rates and extra charges. Bitcoin is free from government interference and manipulation, so there’s no Federal Reserve System‍ to hike interest rates. It is also transparent, so you know what is happening with your money. You can start accepting bitcoins instantly, without investing money and energy into details, such as setting up a merchant account or buying credit card processing hardware. Bitcoins cannot be forged, nor can your client demand a refund.

It’s a small wonder that users call Bitcoin “Money 2.0” or that Bill Gates called it “a techno tour de force.”

Conclusion:

11. Where do I go from here?

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Here are various resources that will direct you to the best places for finding wallets, stores that accept bitcoins, exchanges for trading Bitcoin, and Bitcoin news, prices, charts, guides, and analysis among other information.

  • 99Bitcoins – 99Bitcoins supplies video and text tutorials on how to buy Bitcoins with Paypal, Credit Card, debit card, and more.
  • Bitcoin.org – Choose your Bitcoin wallet from 12 different mobile, desktop, and hardware applications.
  • Coinmap – For bitcoiners who want to spend their BTC at brick-and-mortar locations, Coinmap refers you to hundreds of retailers who accept bitcoin at their physical store locations.
  • Blockchain.info – Blockchain info is the go-to place for checking transactions on the ledger. You can check how much money your wallet contains, or, for that matter, how much BTC is stored at any particular wallet address.
  • Bitnodes – Run by the Bitcoin Foundation, Bitnodes estimates and visualizes the size of the bitcoin network.
  • Wizbit – Wizbit shows all transactions and newly mined blocks in real time on an eye-catching spinning globe.
  • We Use Coins – Weusecoins.com is a list of credible exchanges for trading Bitcoins worldwide or in the U.S.
  • Buy Bitcoin Worldwide – Get help finding a Bitcoin exchange.

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