All right, so you've watched mining adventures part 1, 2, & 3 You've got your dank mining rig and an ASIC or 2 and you are well on your way to becoming crypto rich. But how do you keep those sweet bitcoins and alt coins safe and for that matter if you're not Necessarily into buying a bunch of hardware. How do you just… speculate on the coins, buying and selling them? Let's find out But first let's tell you guys about E.K water blocks, E.K's SMLC phoenix lineup is designed around quick disconnect couplings and brings a modular approach to connecting and Expanding your loop. Learn more at the link below.
So if you've already been mining, you're likely withdrawing your rewards to an exchange, be it GDax, Kraken, Binance, or any of the other few hundred exchanges out there. Or you might be using a wallet on your PC. Now most casuals will probably stick with the former because being able to sell Without moving your funds from your local wallet to an exchange can actually save both time and money in transfer fees. However There are some serious drawbacks to this approach. First, and most importantly, you are not in control of your private keys What's a private key? Ah, I thought you'd never ask.
Ok, so I'm gonna use Bitcoin as an example. In layman's terms a Bitcoin address, that String of numbers and letters, is kind of like a see-through donation container at the local McDonald's. There's a slot in the top so anyone can see how much is in it and anyone who knows the address can put money in but if somebody wanted to get money out, like to Transfer funds to a friend or to buy something. They would need the private key to open up the box Signing the transaction. Now there are a couple of exceptions to this for example Monero makes use of ring signatures to hide balances and Transaction amounts. But most crypto currencies are fundamentally similar in this way. So then when your funds are in a wallet on your PC the private keys are owned and Can be encrypted by you so if there is a fork a duplication of the existing blockchain with whatever new and different features that the duplicator may desire You can export your private keys and then import them into the Fork's wallet to get access to the duplicated funds.
If your funds are on an exchange however support for Forks is Completely up to them because they're in control of the private keys, so let's look at Bitcoin Gold as an example of why this matters. Many exchanges chose to not support this fork outright, so many people missed out on what was Essentially free Bitcoin gold because they were not holding their own private keys at the time of the fork, ugh. Now either of those approaches though, even with those drawbacks, is probably fine for Casual miners who aren't holding more than a couple hundred dollars worth. That is as long as they can afford to lose what they have- more on this later. For larger scale miners and investors though something called a cold wallet is basically an essential tool. Now to be 'cold' a wallet cannot have an active network connection; this makes it nearly impossible to hack. Now some people will just use a network gapped computer So it's unplugged with no Wi-Fi with normal software wallets, and then a system of either webcams and QR codes or thumb drives to complete their transactions.
But this method can be kind of a hassle. So many people with large crypto holdings are using what's called a hardware wallet These come in the form of little devices with physical security prompts like the Ledger Nano S or Trezor Once this device is plugged into a PC, you enter a PIN code, open up a companion app, and then you go about your business. Now, it should be noted that even the methods that we just outlined do carry some risk. But if you think about it, so does putting money in a bank so You know your- your PC's Drive could die, you could lose your hardware wallet, or in both cases you could forget your password.
But as long as you backup your wallet and you keep your backup codes somewhere safe, a safety deposit box in a bank is a pretty good bet, you should be ok. Alright then, so now that your cryptos are safe, let's talk about buying and selling- though I really need to preface this with a quick warning: We are not endorsing any of the exchanges that I'm about to mention, and I personally would not recommend buying cryptocurrency unless you know what you're doing and you are comfortable losing literally all of the money you spent, like literally like this. Gone! All right. There is a very public history of exchanges disappearing overnight or being hacked and losing anywhere from a lot to all of their users money, so be safe. With that out of the way, there are a ton of exchanges out there. Let's look at one of the most mainstream ones: coinbase It's fairly limited in features, but should work pretty well for casual buyers.
The process is pretty simple just hook up your bank account, Debit card, or PayPal account and you are free to buy and sell cryptocurrency up to your limit. And you can raise your limits by doing additional verification with the exchange. But this simplicity comes at the cost of pretty high fees- nearly 4% for debit and credit transactions. And I should also point out that coinbase has a history of freezing trading during high traffic times… So take that as you will. some of the more Pro-oriented exchanges will charge a small fixed fee of a few dollars for bank transfers in and out, and then cryptocurrency transfer fees are typically dependent on that currency's specific network fees. So Bitcoin will likely have a fee of a few dollars while something like Zcash will have almost no fee at all. These exchanges, like Binance, GDax, Bittrex, Poloniex, Cryptopia, and BitFinex also have crypto-to-crypto trading pairs.
So you can actually take your Bitcoin and then turn that into Litecoin without having to first go to a fiat currency. This helps you save some fees and is pretty snazzy. Now if you're not super concerned with getting the best possible rate, a market trade can be a pretty easy way to go. You just pick how much you want to buy or sell and then the trade will transact at the current market rate. Just remember that, especially for very large amounts, that that rate can actually change literally as your transactions are going through, so you might end up paying more or getting less than you initially expected. Now 'limit trades' these allow you to set the price point that you want your trade to execute at, meaning that you may actually be able to get a slightly better rate.
Or, if things go the other way you might end up with nothing going through at all Some exchanges allow what's called 'margin trading'. In this situation you can auto-magically [sic] borrow money from the exchange to leverage your bet based on a multiplier. So let's say you wanted to margin trade a thousand dollars with a leverage of two to one. You would essentially be trading a thousand dollars plus another thousand dollars borrowed from the exchange and then you would be charged interest on it in most cases…
And the benefit is that you could double your profit or… The drawback is that you could still lose all that money and still need to pay the stuff that you borrowed back so Unless you're a seasoned gamb- [cough] excuse me, trader, we would recommend staying away from margin trading. In conclusion, trading can be a fun way to play around with some disposable income.
But again, I think I've said this before but, I would caution against using any money that could seriously negatively impact your life if you were to lose it. So be safe and probably don't buy any [Inserted audio, drawn out]: Bitcoin Sooooo yeeeeaaaaah… iFixit then. You know those guys really like to take stuff apart and teach people how to fix things They are leading the charge in the electronics repair tools industry with their iconic black and blue Pro tech toolkit And it's only 60 bucks It's got tons of great features: the tool roll that makes it compact and easy to store. Their 64-bit driver kit, their wide variety of plastic opening tools, spudgers, and picks. Not to mention suction cups with the new fancy handle to help remove display assemblies. They've got all kinds of stuff, the jimmy pry tool, the ESD-safe tweezers, and all iFixit tools are backed by iFixit's lifetime warranty.
So why pay someone, often more than $60 to fix something for you, when you can make a one-time investment in a fully loaded Pro Tech tool kit over at ifixit.com/linus and fix your stuff forever So thanks for watching guys. If this video sucked, you know what to do. But if it was awesome, get subscribed, hit that like button, or check out the link to where to buy the stuff we featured in the video description except, don't buy the stuff we featured, unless you can afford to lose that money… Yeah. Also linked in the description is our merch store, which has cool shirts like this one and our community forum, which you should totally join. I think an iFixit kit's probably a better investment than cryptocurrency.
All you have to do is like a few device repairs for people and you'll get that investment right back. Several times over. Uhh where'd that money go?.