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Author Topic: Should I use a 'middleman' or a currency exchange?  (Read 756 times)
fajrero
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May 29, 2017, 11:39:58 AM
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Hello,

For years I have been curious about Bitcoin. Though, I never did anything to satisfy that curiosity... until yesterday!

So far, I have read three and a half books (currently in the middle of 'Bitcoin Beginner' by Sam Patterson) and have decided that Bitcoin is something I would love to get involved with.

While I feel I have a more than necessary theoretical understanding of Bitcoin and how the system "works," as someone who simply wants to use BTC as an investment tool (while of course spending a bit (no pun intended) every now and then as well), I find that when it comes to actually purchasing BTC and managing it, I am quite overwhelmed.

I have decided that I would like to make an initial purchase of one BTC. According to one book I read ('Bitcoin for the Befuddled' by Conrad Sparski (which I found extremely informative and easy to read)), there are basically three ways to buy BTC; person-to-person (which is basically not an option for me), through a 'middleman' like Coinbase, or via a currency exchange.

Buying through a currency exchange seems like the better option to me, because it is cheaper. However, using Coinbase (for instance) provides ease and convenience for a newbie like myself.

While the higher fee isn't exactly a plus, it is something I don't mind paying, given the service that is provided. However, after having read a few books and some of the threads on this board, I also feel that I would like to hold a vast majority (90% or so) of my BTC in an offline wallet.

If I were to buy BTC using Coinbase, how simple would it be to move some percentage of it into an offline wallet?

And since I don't plan on executing a particularly large number of transactions, is using Coinbase (or some other middleman) worth it? Would it be better for me to simply go through a currency exchange?

Thank you for any helpful information/advice,

-Faj

Also, I apologize if my use of the BTC symbol is inappropriate (or annoying). I know there is a difference in meaning between 'Bitcoin' and 'bitcoin,' and I wasn't sure which would be appropriate in the above sentences.
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May 29, 2017, 11:55:12 AM
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Whichever suits you. If you are ok with the high fees go for it.

What I would actually do is find someone on localbitcoins.com and do the deal (it's your freedom if you don't want to do person-person but I can't get why you don't want to ).

So far, I have read three and a half books
WoW ! I've never read one book and got to know what's essential just by dipping my feet in bitcoins using faucets which give microearnings just to test out how all the transaction sending thing works. It really isn't that complicated at all.

I know there is a difference in meaning between 'Bitcoin' and 'bitcoin,' and I wasn't sure which would be appropriate in the above sentences.
From where did you get this piece of info ?  Cheesy
bitcoin, Bitcoin, btc, BTC are all the same thing. Smiley
fajrero
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May 29, 2017, 01:13:15 PM
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Quote
Whichever suits you. If you are ok with the high fees go for it.

What I would actually do is find someone on localbitcoins.com and do the deal (it's your freedom if you don't want to do person-person but I can't get why you don't want to ).

It's not that I "don't want to," but I just don't think it is feasible given where I live (a rural part of China). I imagine nobody here has even heard of Bitcoin (let alone possesses any).

Though, I have read that the number of Bitcoin users in China is quite substantial (perhaps in the major cities). So, person-to-person may be a possibility.

Quote
WoW ! I've never read one book and got to know what's essential just by dipping my feet in bitcoins using faucets which give microearnings just to test out how all the transaction sending thing works. It really isn't that complicated at all.

Yes, I think one would acquire the most knowledge simply from experience, which is why I want to actually make my first Bitcoin purchase (which will undoubtedly subsequently teach me quite a bit). But like I said in my original post, I find the amount of information and options available to be particularly overwhelming.

Quote
From where did you get this piece of info ?  Cheesy
bitcoin, Bitcoin, btc, BTC are all the same thing. Smiley

Obviously, I am not an expert, but I think you are mistaken, in this regard. I specifically remember reading this particular detail in more than one book. I am actually planning on re-reading one of the books tomorrow, and when I come across it, I will let you know. In the meantime, however, I am sure an individual with more knowledge regarding this particular subject can shed some light.
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May 29, 2017, 01:29:29 PM
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It's extremely easy to transfer your Bitcoin to an offline wallet from Coinbase.  It's just like any other transaction - you get an address that you want to send to from your offline wallet, then you just send from Coinbase. 

As for what offline wallet you get, it depends what you want to do with it.  If you want ultimate security and you don't need to use it regularly, I would consider a paper wallet.  If you need to do regular transactions, I would look into a TREZOR or another hardware wallet.

I would, however, recommend using Bitstamp instead of Coinbase to dramatically reduce your fees.

P.S: most people won't mind whether you say "bitcoin" or "Bitcoin".  Personally I just use the capital for everything.
fajrero
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May 29, 2017, 02:13:40 PM
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I would, however, recommend using Bitstamp instead of Coinbase to dramatically reduce your fees.

Thank you Iranus, I appreciate your advice.

Bitstamp seems like a nice option, as well. I had never heard of it before. Just out of curiosity, what is the difference between Bitstamp and Coinbase? And why is Bitstamp less expensive?
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May 29, 2017, 02:55:04 PM
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Coinbase NOT for gambling, will got banned. i got banned once.
but if u buy bitcoin from them only then is ok.
Bitstamp i havent use it.

use currency exchange better, and use local exchange for u to buy bitcoin more convenient.
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May 29, 2017, 05:53:15 PM
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If I were to buy BTC using Coinbase, how simple would it be to move some percentage of it into an offline wallet?
Well it would take probably two mouse clicks and 2-3 clicks on keyboard.
Smiley Why would you think it would be somewhat difficult?

Bitcoin is VERY easy to use, you should try to USE it. You learned a lot by reading but u lacking practice. Buy 5$ of bitcoin on coinbase for example and send it to your software wallet. Easy-peasy.

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May 29, 2017, 06:53:48 PM
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I prefer to buy on coinbase and then send to an exchange for trading. If you are just going to hold for long term, you could send the bitcoin to an offline wallet.
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June 10, 2017, 04:28:33 PM
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Coinbase NOT for gambling, will got banned. i got banned once.
but if u buy bitcoin from them only then is ok.
Bitstamp i havent use it.

use currency exchange better, and use local exchange for u to buy bitcoin more convenient.


Banned for what ? How can you gwmbke there ? Even if you could why would you be banned ? The only bans I know on an exchange is chat ban. I have never ever heard of account banning. Why don't you expand and tell us what you did and how it happened ? If what you say is true I think it would benefit others to share this info.

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June 11, 2017, 06:08:12 AM
 #10

you can use escrow from this forum. There are a lot of trusted escrow have. you can chose anyone who have high reputation and has green trust.If you want to use exchanger , than use localbitcoins.com its safe and secure also

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June 18, 2017, 12:50:29 PM
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you can use escrow from this forum. There are a lot of trusted escrow have. you can chose anyone who have high reputation and has green trust.If you want to use exchanger , than use localbitcoins.com its safe and secure also

Blindly trusting people with green trust is a bad idea. You should use people with previous experience experience of trading in Bitcoin. Esspecially those with many trades or high value trades. Vouches as well at even better. I don't see why you don't just use localbitcoin as the above poster mentions. I mean most people use them they so good.

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June 23, 2017, 01:36:31 AM
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Is LocalBitcoin really safe? I can not get money from Bitcoin in my country so I am looking for options and this one looks like the best, but how do I know the person I am selling to is trustworthy?
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June 23, 2017, 02:13:18 PM
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I think the easiest way to use the exchanger.
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June 23, 2017, 04:48:00 PM
 #14

Hello,

For years I have been curious about Bitcoin. Though, I never did anything to satisfy that curiosity... until yesterday!

So far, I have read three and a half books (currently in the middle of 'Bitcoin Beginner' by Sam Patterson) and have decided that Bitcoin is something I would love to get involved with.

While I feel I have a more than necessary theoretical understanding of Bitcoin and how the system "works," as someone who simply wants to use BTC as an investment tool (while of course spending a bit (no pun intended) every now and then as well), I find that when it comes to actually purchasing BTC and managing it, I am quite overwhelmed.

I have decided that I would like to make an initial purchase of one BTC. According to one book I read ('Bitcoin for the Befuddled' by Conrad Sparski (which I found extremely informative and easy to read)), there are basically three ways to buy BTC; person-to-person (which is basically not an option for me), through a 'middleman' like Coinbase, or via a currency exchange.

Buying through a currency exchange seems like the better option to me, because it is cheaper. However, using Coinbase (for instance) provides ease and convenience for a newbie like myself.

While the higher fee isn't exactly a plus, it is something I don't mind paying, given the service that is provided. However, after having read a few books and some of the threads on this board, I also feel that I would like to hold a vast majority (90% or so) of my BTC in an offline wallet.

If I were to buy BTC using Coinbase, how simple would it be to move some percentage of it into an offline wallet?

And since I don't plan on executing a particularly large number of transactions, is using Coinbase (or some other middleman) worth it? Would it be better for me to simply go through a currency exchange?

Thank you for any helpful information/advice,

-Faj

Also, I apologize if my use of the BTC symbol is inappropriate (or annoying). I know there is a difference in meaning between 'Bitcoin' and 'bitcoin,' and I wasn't sure which would be appropriate in the above sentences.


3 and a half books? Excellent! Too bad I couldn't get myself to read that much.  Sad

Anyway, while using coinbase is very newbie-friendly and very easy to use, I suggest just going with crypto exchanges (bitfinex, bittrex, kraken, and the like). Yes, you will probably have a hard time at the beginning due to all those numbers and charts and all those options; but trust me. it will be worth it in the end. Who knows in the future you might try out stocks and something similar. Knowledge goes a long way.  Wink

Also, I suggest investing in a Trezor or a Ledger Nano S. They're very handy and useful hardware wallets. Take a look on the advantages and the features.

I wish you luck on your crypto journey.  Wink

Links:
https://trezor.io/
https://www.ledgerwallet.com/

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June 23, 2017, 06:12:19 PM
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 -snip-
I know there is a difference in meaning between 'Bitcoin' and 'bitcoin,' and I wasn't sure which would be appropriate in the above sentences.
From where did you get this piece of info ?  Cheesy
bitcoin, Bitcoin, btc, BTC are all the same thing. Smiley

There is no "official" term for Bitcoin. Personally, I lean towards below suggestion*:-

Quote
- Use Bitcoin (with a capital "B") when talking about the concept/technology.
- Use bitcoins (no capitalization) or BTC when talking about the unit of currency (4 dollars - 4 bitcoins).
- Never use BitCoin or BitCoins

* https://bitcoin.meta.stackexchange.com/a/22

Coinbase NOT for gambling, will got banned. i got banned once.
but if u buy bitcoin from them only then is ok.
Bitstamp i havent use it.

use currency exchange better, and use local exchange for u to buy bitcoin more convenient.

Banned for what ? How can you gwmbke there ? Even if you could why would you be banned ? The only bans I know on an exchange is chat ban. I have never ever heard of account banning. Why don't you expand and tell us what you did and how it happened ? If what you say is true I think it would benefit others to share this info.

It is not a new thing. Many Coinbase users had their accounts banned for sending/receiving bitcoins to/from gambling, drug, illegal sites/equipments et cetera.

https://www.coinbase.com/legal/prohibited

https://cointelegraph.com/news/coinbase-is-tracking-how-users-spend-their-bitcoins

http://truthvoice.com/2015/05/coinbase-accused-of-tracking-bitcoin-users-notifying-cops-of-transactions/ (I haven't verified some of the details in this article)

-snip-
Coinbase is required to comply with many financial services and consumer protection laws, including:
 • The Bank Secrecy Act, which requires Coinbase to verify customer identities, maintain records of currency transactions for up to 5 years, and report certain transactions.
  -snip-

 -snip-
6.4. Prohibited Use. In connection with your use of the Coinbase Services, and your interactions with other users, and third parties you agree and represent you will not engage in any Prohibited Business or Prohibited Use defined herein. We reserve the right at all times to monitor, review, retain and/or disclose any information as necessary to satisfy any applicable law, regulation, sanctions programs, legal process or governmental request. We reserve the right to cancel and/or suspend your Coinbase Account and/or block transactions or freeze funds immediately and without notice if we determine, in our sole discretion, that your Account is associated with a Prohibited Use and/or a Prohibited Business.
-snip-

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June 23, 2017, 06:27:03 PM
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I believe you need to make the decision based on how comfortable you are setting up a wallet with and navigating an exchange. It's not rocket science but it is more complicated than using a middleman like Coinbase or whatever similar entity is better serving China.

Middlemen charge a fee and what get for that fee should be convenience. Middlemen also usually keep the private key of the wallet, so you do give up some security, but this is easy to mitigate after you have purchased Bitcoin.

People have mentioned hardware wallets in their responses to you, which is all well and good, but it doesn't help you acquire Bitcoin.

Have you read this beginner's tutorial from Blockchain.info on "how to buy your first bitcoin"? I think it would be very suitable for you: https://blockchain.info/wallet/how-to-get-bitcoins

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