Bitcoin Forum

The blockchain is really big now. Are there advantages for me, going forward, in having the whole thing?

I have other questions too, but one at a time might be a good way to go.

Thanks,

Mike

so here it is the last 8 years worth of data
yep thats right 8 years of international financial transactions, fitting on the same size as a fingernail.
https://i.imgur.com/mRwuWmX.png

as for is it worth it for yourself.

well its more like a hive mindset. if everyone does their part it helps everyone out.
however if the value of bitcoin you hold is not life changing for you, then you wont notice or need to worry much about changing your life.

id say the more bitcoin you own and afraid of losing the more you should consider running a full node

Great! Thanks for an inspiring answer. Then really, the whole deal is the good way to go.

Next question;
   
    Downloading the whole shebang will take me a while. While the blockchain is downloading how difficult would it be to start using Electrum and then switch over to something fullblown?

Thanks again,

Mike

If you are using a client like Bitcoin Core which downloads the entire Blockchain, you will reduce your reliance on others to supply you with the correct information about the network. Full clients independently verifies the data and they are much much safer in that aspect. You are helping the network by running a full node.
Not difficult at all. If you are using Electrum from the start, you can easily transfer it to Bitcoin Core and use the coins from there.

It would be better if you could ask all your questions in a post, I will try to answer all of them.

Personally I don't see any requisite thing to download whole blockchain and I don't need it. If you have bitcoin business (exchange, etc) than you must download whole blockchain but I think you aren't that person so don't fill your disk space or flash memory. Also I use wallets that doesn't need blockchain download.

as long as you have full access to your private key to import the keys to another service should the one you use stop operating. your fine.

but if you start getting to a point of holding enough value that it would hurt you to lose, then you may desire the independence of running a full node

Thanks to all who have replied.

 Another one;

  Would it be fair to say that 'cold storage' is the way to go? I read earlier today that most users go with 'cold storage'
  If so, can most clients work with this?

 And another (might seem kinda dumb, but I'm new to all this)

  When I want to change back my bitcoins to regular money, what do I do? These exchange things seem pretty unregulated.

Thanks again,

Mike

Any can be. The term cold storage defines an address that is created offline, on a clean computer. As long as the client does not require an internet connection to make an address, it can be used as one. Electrum, Armory, Multibit, Bitcoin Core will work. Electrum is my personal favorite though, visit this link (http://docs.electrum.org/en/latest/coldstorage.html) to find out more about Electrum.
Create an account at a reputable exchange (bitfinex etc.) and transfer your Bitcoins there. You might need to go through a verification procedure if their local laws say so. After that, just exchange it and you can withdraw it to your bank account. Most are regulated. Otherwise, you can try Localbitcoins.

I have a simplistic approach to things. If you aren't using core, then you are effectively using a banking service, and one of the advantages of Bitcoin is that it cuts out banks in its pure form.

Thanks :-)

  You mentioned bitfinex      I'll check it out.
  Mat bitstamp also be worth looking at?

Cold storage can be used when you stash away your coins and forget about them. These coins are not in a wallet which is connected to the internet.
If you do a lot of transactions frequently, these funds can be drawn from a wallet connected to the internet. i.e. a "hot" wallet.

Excellent.

I think I have about as much information as I need for now.

Thanks to everyone who helped out here.

All the best,

Mike :-)

Bitfinex can be trusted again after they got hacked recently which was really huge  ??? :-\
I will rather say look at bitstamp and other trusted exchanger but there is no guarantee that bitfinex or any other trading platform will never get hacked in future. Only put bitcoin in those platform when you are about to exchange, when you are just holding hold them in cold storage.

The advantage is really that the network becomes safer and stronger with more nodes.  so if you are invested in bitcoin then running a full node is better in that it helps the network which will help your investment.  but it changes nothing for individual transaction.

The only way to be 100% certain that you are getting the real deal, is by downloading bitcoin core and keeping the blockchain up to date in it's integrity within your hard disk, everything else requires a certain level of trust.

Its generally accepted that electrum's system is safe, but in order to be completely sure, I would advice that you take the time to download bitcoin core and run your own node. Running your own node helps making the network stronger so that is in every bitcoin holder's interest too.

Hi Mike,
I would use cold storage for larger amounts that you do not plan on spending soon. There are various ways to keep your coins safe and cold storage is at the safer end of the scale. I think of security in terms of a balance between amount, threat level, and convenience. So I might sacrifice security and keep a few bucks in an app based phone wallet. But I would not store an amount worth more than the phone.

As to the second part of your question, can I suggest you consider spending your money rather than paying to have it downgraded to dollars? You have bitcoin now. You can buy from places around the world with greater security, speed, and value than any other payment system.
Consider this true story:
I recently wanted to buy a weather station for use by my gun club. We need all sorts of weather data for long range shooting. I could have risked sending some bitcoin to an exchange then paying some money to convert back to dollars then waited for the funds to arrive into my bank account. Then I could buy online by transmitting all the information about my credit card identity and storing it with people I don't know. A fundamentally unsafe thing to do.
What I actually did was find a place that takes bitcoin and just bought it.  Like many retailers who accept bitcoin they offered a discount for using it. The seller saved 3% , which is the ridiculously high fee the seller pays when you use a credit card, and the saving was passed on to me.  When I checked out I paid on the bitcoin network. The seller does not really know it was me who paid, but also does not care. The seller has cash confirmed in minutes not days and can ship right away. And no information was provided by me that risks my other bitcoin.

There is a reason why bitcoin is disrupting money transmission and you are missing out on the utility of it when switching back and forth between currencies.

Cheers  :)

If you download the whole blockchain, this means that you are using Bitcoin Core. Having numerous Bitcoin Core nodes, also named full nodes is a very good things, so I encourage you to do so. The more we have healthier the network will be. You will bring some help to the network by reinforcing the peer-to-peer network, and that's good. That will also help you as you'll be able to run Bitcoin Core, which is a very secure Bitcoin wallet (as it is the official Bitcoin wallet, this makes sense). For those arguing that downloading Bitcoin Core is an redundant process, for both the time it takes and the space it does require, I would say that it is not true, since you can just let it download peacefully, so this is not a true argument, and since nowadays an average computer has at least 1 terabyte hard drives, so 100 Gb won't make much difference. And in case you like taking a photography of all the trash bins of its city in 4K, and fill up tons of HDDs with them, nowadays a 1 terabyte hard drive is cheap, it will not cost you more than 50$ ! At this price that would be sad to either say goodbye to your love for trash bins or Bitcoin Core !

As an alternative to an exchange, you can also use an exchanger service (exchanges and exchangers are different services). At an exchange, you buy and sell from other traders, so the spread is typically small. Besides, you can just add an order with the price at which you want to exchange the coins and wait patiently till it gets filled, but withdrawing fiat to your bank account may get pretty expensive there. Exchangers just change your coins to fiat (or other coins) and send the proceeds to the destination you enter. Sometimes it is profitable to use a full-fledged exchange for conversion and withdrawal, especially when the exchange lowers the withdrawal fees, but in most cases exchangers give better rates overall...

But use only a trusted exchanger (this refers to exchanges too, though to a lesser extent)

Everyone in this thread has given you correct information. I've discovered that no matter how many questions you ask on a forum the answers always fall short of the complete picture. That's because forum answers need to be fairly brief and complete answers are usually lengthy.

Downloading the whole blockchain, running a trustless wallet, running a secure wallet, maintaining the ledger, keep your own ledger all mean the same thing - running a full node. Here is the best and most complete guide currently available for running a full node that's valid for the most current stable version of Bitcoin Core: https://bitcoin.org/en/full-node#what-is-a-full-node

Most people have additional questions about running a full node that are poorly answered by forum members and many times the answers they get end up being wrong. Read this to clear up any additional questions you might have: https://en.bitcoin.it/wiki/Clearing_Up_Misconceptions_About_Full_Nodes

Your next question is about cold storage or securing your wallet, protecting your bitcoins, how to safely use Bitcoin or generally how to have a safe experience and not lose any money while using Bitcoin. The same website covers that topic at length: https://bitcoin.org/en/secure-your-wallet

Here's a fairly complete listing of all the different wallet types for securing your bitcoins and a description of different methods of storage. https://www.buybitcoinworldwide.com/kb/how-to-store-and-protect-bitcoins/

You also mention trading your bitcoins for government paper money. That's not a dumb question and you'd be surprised how many people don't know how to do it and feel safe while doing it. Here's a pretty good article that can clear that up for you: http://www.coindesk.com/information/sell-bitcoin/

Oh yeah, welcome to Bitcoin.   :)

I think one of the best things about running a full node, would be that you are helping to increase decentralization. The more decentralized

Bitcoin is, the better for everyone. You can also use the pruned Blockchain, because it is much smaller. Way to go for jumping in on the deep

end, most people start out by using online wallets and they contribute little or nothing to helping with decentralization.  ;)

Again, I owe a lot of thanks to all the folks that are giving me great information here. Thanks to everyone :-)

I figure that now I've got a bit of an idea of the basics, I will stick a toe in the water and fool around with some small transactions and storage methods. I still have a hell of a lot to learn, especially about the software involved and pass phrases etc., failsafe tricks for the machines I use (very very important, I reckon), and other stuff.

So, for almost the last 24 hours I have been sitting back downloading the blockchain using Bitcoin Core V12. Set it to start with the machine I'm using for the job, but when I was forced to re-boot I got errors and it wouldn't resume. Falling back to V 11.2 seems to be working so far. Right now it's loading the block index for what I have of the  blockchain so far.

To sum up, my strategy from here is to carefully re-read what everyone has advised (including checking the links to other sources of info), and then buy a small amount of BC, and get it sent to Electrum and practice moving it around a bit until I feel comfortable with what I'm doing. By then, I hope to have the whole blockchain and I should have a much better idea of what I am doing.

Cheers folks,

Mike

Are you a miner or just a regular user. If you are just a regular user having low amounts of bitcoin then there is no need to download the whole blockchain since it will be just a waste of time. But if you are a miner and have a big volume of bitcoin then its wise to download the whole blockchain. But its up to you if you think its much better to run in full node then its your choice.

 Well, from what I have read here, having the whole blockchain would seem to be good for the entire Bitcoin system, and I don't think it can do any harm.

 While it is loading (probably quite a few days), I'll play around with all the other bits of the system and try to get the hang of it all. lololol I'm no spring chicken! lololol

I came upon this;

Myth: There is no incentive to run nodes, the network relies on altruism

It is very much in the individual bitcoin's users rational self interest to run a full node and use it as their wallet.
Trustless

Running a full node as your wallet is the only way to know for sure that none of bitcoin's rules have been broken. Rules like no coins were spent not belonging to the owner, that no coins were spent twice, that no inflation happens outside of the schedule and that all the rules needed to make the system work are followed (e.g. Difficulty.) All other kinds of wallet involve trusting a third party server.
    From https://en.bitcoin.it/wiki/Clearing_Up_Misconceptions_About_Full_Nodes

Trusting a third party server would seem the biggest concern.  So, I'm going full node.
Thanks for getting me more interested in the difference.

Mike

I think it is a good idea for you to run the full wallet if you have the space then do it. We need people like you to keep things running smoothly. :=) good job !

Dont forget to keep s backup in case your pc crashes and the blockchain becomes corrupt. Then you would have to download ot from scratch and that is no fun.

lololol Yeah! I found that out. Was running Bitcoin Core V12 on an XP 3 machine and it crashed and then kept crashing. V11.2 works, but I had to start from scratch again. Even V11.2 isn't well liked by this machine, and it's crashed twice, but it recovers the blockchain data with no trouble and keeps going.
Only 2 years and 46 weeks to go,  lolololol
Heck, I may as well back up what I have already. Thanks for the heads up!

Mike

Bitcoin Core does not support XP anymore. If you continue to use it, you will not be able to upgrade to a newer version and have a better security. Try upgrading to at least Windows 7 and you can use versions newer than 0.11.2.

I have to commend you on your persistence, because a lot of other people would have given up after the first try. Is bandwidth a issue in your country? < Speed & cost > because you will have to factor that into your operating cost to run a full node. Some countries have very expensive bandwidth.

Hope you get it sorted, and welcome to the backbone of our little community. ^smile^ 

Not where I am now, or where I expect to be. Unlimited accounts are the way to go - even if one has to do a bit of waiting from time to time, like now! lolololol

Down to 2 years and 32 weeks YAY! lolololol Still, I'm a bit (no pun intended) confused. The early blocks were really fast to get, but they seem to get progressively slower. Am I imagining things?

Mike

You're not. The block size now is significantly more filled as compared to the blocks several years ago. Since the client needs to verify each block and transaction, it will take more time, especially if you have a slow computer.

Thanks, Ranochigo.

The more recent blocks all seem to be around the same 130,000 size. Guess it just takes more processing 'cos they are more 'filled'.

Mike