So you bought Bitcoin? What now?
Congratulations! You’ve made the first step in becoming part of the revolution that is the Bitcoin network!
So we’ll assume that you just bought some BTC (the ticker symbol for the bitcoin currency) and it is still being held on the exchange that you bought it, maybe Coinbase or the CashApp for instance.
Being new to this space our first recommendation would be to move your BTC off the exchange and into a wallet where you control the private keys. ‘Why?’, you might ask. Fair question. The answer is quite simple. If you don’t have a wallet where you are in possession of your private keys to your Bitcoin then you are at risk that your Bitcoin could be seized *by governments* or the exchange in question could be hacked and your bitcoin stolen. The best practice to eliminate yourself from these risks is to move your bitcoin off the exchange and into your own wallet as soon as you can.
Where do I move my bitcoin?
This is dependent on the amount of bitcoin you have relative to your wealth. For instance, if you bought $100 worth of bitcoin and it is maybe 1% of your monthly wage then perhaps you would like to keep it on a mobile wallet on your smart phone, such as the excellent Blockstream Green wallet. This is a great solution if you want to make small purchases or maybe show friends and family the cool tech that is bitcoin!
On the other hand if you see Bitcoin as a long term investment and store of value and you have invested maybe 10% or more of your savings into it then you should seriously consider moving it to ‘cold storage’ in the form of a hardware wallet such as the Trezor, Coldcard or Ledger Nano, all of which are excellent solutions, although the Coldcard has better options for more advanced users who want better security for their bitcoin. We will cover this in another article!
So, you have your bitcoin and you have decided which option is best for you. What's next? Well, ok, let’s assume for simplicity sake that you decided to buy $100 worth of bitcoin because you want to try it out and get familiar with the tech before investing further. You go onto the app store of your choice dependent on your phone and download the Blockstream Green bitcoin wallet. Great! Awesome choice! Let’s move on.
The first step is to ‘create’ a new wallet inside the app. You will then be presented with 24 random words, your mnemonic phrase.
These words represent your ‘private key’ in a more user friendly format than the normal string of letters and numbers (A private key is 256 Bit number generally represented by 64 numbers and letters).
These words are crucial to you being able to control your wealth. Write them down on a piece of paper, and store them safely, this cannot be emphasised enough!
STORE THEM SAFELY!
Without these you could lose your entire stack of BTC! With Blockstream Green (and most other wallets) you also get the opportunity to create a separate passphrase to enter your wallet either in the form of a ‘normal’ password or maybe a 6 digit number. You will need to re-enter this for confirming and sending a transaction also.
Ok, easy right? ‘So what is the next step?’ Well, now you need to get your bitcoin from the exchange to your wallet.
So open your wallet and find the ‘Receive’ button or tab.
Click on this and you will be given a ‘Bitcoin address’, this will be a format similar to this.. 1CC3X2gu58d6wXUW (not a real address!)
... click ‘copy’ then head over to the exchange where you bought the bitcoin and find the ‘send’ tab or button.
When you arrive here simply paste the address that you copied from the mobile wallet into the box provided.
You will need to enter the amount of bitcoin you want to send, in this case we’ll assume all of it (generally this is an option to ‘send all’), then, crucially, double check the address that you pasted here is the same as the address that you copied from the Blocktream Green wallet.
If it’s good then click ‘SEND’. Now you just wait for the BTC to appear in your mobile wallet!
Awesome! You just did your first Bitcoin transaction! Go show your friends and family!