Observations of a Noob

[JonathanHiggins]

Good day Bitcoiners,

Yesterday i had never heard of Bitcoins, but i have come across various media reports of Bitcoin in the past 24 hours so here i am.

First thing i would like to note is that either the Bitcoin bubble has burst OR this is a correction in market price, there will be no debate about this as its a fact.

Now after spending all day reading about Bitcoin i admit im still struggling with the complexity of the entire currency, i doubt i will ever fully comprehend things such as how mining works and what actually constitutes a block or string etc.

Having said that and now having downloaded the Bitcoin client (that's what i call it whether its the correct term or not) I'm still left with the confusion of actually trying to buy Bitcoins. I gather you need to register at an exchange like Mtgox, which from what i read takes a while to fund and withdraw at.

The thing that mainly concerns me and stops me from trying to buy Bitcoin is that i feel quite uneasy that these Bitcoins apparently just sit on my computer, open to hackers, computer thieves and my computer going kaput, i would feel much more comfortable if there existed a trusted bank in which i could make easy deposits and withdrawals at via paypal.

Being i am a "man of means" i would feel quite uneasy if my cash was sitting in my home guarded by the lads (my two dobermanns) or worse still ON my computer, if people are to invest in Bitcoin from a mainstream perspective they need to be totally worry free about their purchases, selling and indeed their storage.

Given my concerns what are my options at this point to put my mind at ease?

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[Drifter]

First thing i would like to note is that either the Bitcoin bubble has burst OR this is a correction in market price, there will be no debate about this as its a fact.

Good first impression. "This is what's happening, you can't argue because I say it's fact! Now shut up!"

Given my concerns what are my options at this point to put my mind at ease?

Create a savings wallet, save it on another usb/hard drive and delete the original wallet.dat from your computer. Keep the usb/HD in a safety deposit box. Voila. You now have your money safe in a bank like you want.

[RodeoX]

I understand your safety concerns. But you can save your coins to a standard as good as a bank (well, without FDIC insurance) Use encryption and thumb drive backups. Then if your bank fails you still have access to some money.

[joeykrug]

First thing i would like to note is that either the Bitcoin bubble has burst OR this is a correction in market price, there will be no debate about this as its a fact.

Good first impression. "This is what's happening, you can't argue because I say it's fact! Now shut up!"


Haha, nice sarcasm, but he is kinda right lol, it has to be one or the other.  He just made a generalized statement such as "Bitcoins are either going to succeed or fail."

I think it is a correction in price, a triple in value usually has some form of a correction. 

[JonathanHiggins]

Joeykrug, thanks for pointing that out, it may sound arrogant to some but im just being honest here.

Thanks for the tips so far BTW, sound advice.

On reflection, given the abysmal financial situation of many countries and their banking systems i understand how people would not view my worries as a going concern, but in my country we have a very strong banking system which i would, at this time, rate as worlds best practise, so i need to ask myself before i would purchase Bitcoins is this a better bet than money in the bank? In which the answer is a NO at this time unless the risk/reward rate for owning Bitcoin out ways my thoughts otherwise.

This would only occur if I thought that Bitcoins would continue to rise in value, beyond the almost risk free rate of 7% pa in the bank plus the currency risk of changing from an outperforming currency to US or EUR etc in order to purchase Bitcoins.

I will need to give this further thought on the matter i think.

BTW, lets see if anyone has guessed where i live yet?

[TiagoTiago]

You want a bank to hold your bitcoins? Save your wallet into a flashdrive and put the flashdrive in a safe inside the bank (write down the address(es) in that wallet so you can make deposits without needing to go plug the flashdrive).  To spend those coins, bring a laptop with cellular internet connection (or get a bank that offers WiFi inside the safe), then send the coins you wanna spend from your savings wallet to another wallet you own or directly to the person you wanna pay.


For buying BTC, you don't need to use one of the big exchange services, if you find someone you can trust, just deposit regular money in their bank account and have them send BTC to one of the addresses you own.

[Soros Shorts]

the almost risk free rate of 7% pa in the bank plus

<snip>

BTW, lets see if anyone has guessed where i live yet?

I would like to know! I have converted more than an insignificant portion of my USD to AUD and South African Rand and I am only getting approximately 3.5% for both. Which currency would give me 7%?

[srb123]

BTW, lets see if anyone has guessed where i live yet?

I for one welcome a fellow Australian, although I'm only getting a pissy 5.5%.

Where bouts are you, I'm down in Sunny Victoria.

[JonathanHiggins]

G'day, yes im on the central coast, north of Sydney.

Its pretty tough getting 7% unless you are in a 12 month or more term deposit, i myself get 4.5% at call ATM, though my bank manager said the other day i can have 5% at call if up my deposit.

Certainly beats the near 0% on offer in the US though.

[honeybadger]

It would be great if somehow the wallet file could be stored encrypted and decentralized over the network. That would quell some fears of crashing HDs

[JonathanHiggins]

It would be great if somehow the wallet file could be stored encrypted and decentralized over the network. That would quell some fears of crashing HDs

That is my thoughts also, which is basically what a "bank" would be for, a "databank" if you will.