My company has started an initiative to get us to learn about Bitcoin. I’d always been somewhat interested, mostly because I remembered the concept of mining them which seemed like some sort of magic. I’m not going to get into mining them here for a couple reasons, 1) From what little research I read, you need a lot of horsepower, and even then need to be part of a group of fellow miners for it to begin to be worth while, and 2) I really don’t understand it.
What I will do is try and give you a little walk through of what I did, what I learned, and the mistakes I made.
First of all, research. Learn about Bitcoins, wallets, exchanges, private keys, block chains, etc. At least to some degree. Our companies site has some great starters for you here: OddsShark: Bitcoin have a look, and note the other related links on the right. Full disclosure, our company is an affiliate site for online sportsbooks, and some of the info is geared in that manner, but the information is valid in all regards.
Of course, me not being the most patient person, totally disregarded my own advice, and after a perfunctory read (er… skim) I googled Bitcoin wallets and read pros and cons of a few and went to work. And totally wasted a couple days.
After looking at a few wallets, it appeared to me that one called Armory had what I wanted. To be honest, I mainly used this info from bitcoin.org, and some screenshots of the interface. The vulnerable environment note you see is basically telling you (when you hover over it) that wallets held on your computer can be subject to malware. Same is true of any software you store on your computer. You CAN get hardware wallets, but I have no clue about them.
Now setting up a wallet is full of warnings, and instructions. Read them, you’ll need pass keys/phrases. These are important, if you lose them, you have no way to recover your wallet if you lose access some how. Think of them as your id, without them the bank will just kick your sorry ass to the curb.
So I downloaded it, ran it, determined how to receive bitcoins, and sent the link off internally. Another part of the initiative was learning how to buy bitcoins, so again with some limited research (Do as I say, not as I do) I figured out that I needed to use an exchange, similar to how you’d exchange currency at the airport. There are exchange rates, and fees. I did some googling again, looking for recommendations for exhanges in Canada, or dealing in Canada at least, and found QuickBT. Are they any good? Well they seemed to be to me, I gave them an address from my wallet, worked out the exchange rates to get about $20 dollars worth and submitted. I had to provide my cell number for verification, and had to call back a fully automated number to validate and activate my account, but in about 30 minutes had notification my transaction was processed. The emails say any future purchases should be nearly instantaneous, so we’ll see on that front, but have no reason to doubt them.
Then came the waiting… and waiting… and…. Armory says it’s not online? Why isn’t online, my computer is online? So researching that I find that Armory requires you to have a local bitcoin blockchain client. My limited understanding of this, is that it’s a registry/database of bitcoin transactions, the good news is, you don’t need to know all there is to know, anymore than you do about how banks transfer money to each other, but if you choose to, again, the info is out there (I feel like I’m on the X-Files). So I download, Bit Core QT (I think that was the name), which by the way has its own wallet, so now I have two.
But a wallet is kinda meaningless in a way, your “money” is associated with keys, not the wallet itself. You can import and sweep your keys into a new wallet, and as you’ll see that can be important.
So I start the app, and restart armory and see that I am now online! Yay! But still not showing the coins I bought …. hmm… so I look at bitcore and see its status… downloading blocks from 3 years 42 weeks ago. WTH? Friday at about 6PM – Ok, I’ve got good bandwidth, this shouldn’t be bad.
Tick tock, tick tock….
So Sunday morning, its finished! Yay, now I should have my “money”! So I start armory again, and it scans databases, for about an hour… then… nothing. There is a bar on the screen saying it will scan transactions, that never happens… I wait 30 minutes… an hour, all the while googling for info and options. Nothing. So I wonder if I’m screwed, and look for how to import to a new wallet.
Keys and Wallets and Sweeping, Oh My!
During that process I find that your “money” is associated with keys, not the wallet. Googling a bit more, I find that you can export your keys from Armory (and I assume others). Doing a bit more research, I decide upon using Electrum as a new wallet (3 now! woohoo!) mainly because it has 2 factor authentication with my google authenticator. I get it installed and set up no problem, and decide to try and import my keys.
Now there are 2 options here, and the terminology is a bit muddled to me. One is to sweep your keys. This allows you to essentially bring the keys from your old wallet into your new. I tried that option, and for whatever reason, I could never seem to get the “next” button to become enabled. Probably an ID10T error, but oh well! So I tried the next option which is an import. The difference is that, at least in Electrum, you import them to a new wallet.
That said, I gave that a try and waited and it never worked. Just seemed to hang. Maybe because I tried all 3 at once. So then I tried one, and it never seemed to work at all. I forget what info it gave me, apologies for that, but read up and it seemed that it would only import keys with confirmed transactions. Moore googling, and was able to find a site called Block Explorer that allowed me to check my keys. Low and behold it showed one as having the Bitcoins I bought – Whew!
Trying Electrum again, creating a new wallet, and just using that key, poof! I have it! My little over $20 is there! But now I have another wallet (4 in case you lost count). Deciding I’m gonna abandon the Armory and Bit Core ones (I assume just delete the app and app data), I still have two in Electrum. Not ideal, for me at least, so easy solution? I send all my coins from one wallet to a key in my new wallet, and poof, in a couple seconds it shows up.
It is unconfirmed at first, not sure the inner workings, but something like blockchains being created every 10 minutes with new transactions, and once that happens it’ll be confirmed. Details be damned, all I know for sure is that approximately 5-10 minutes later, the status changed, and I now have the confirmed “money” in my main Electrum wallet.
Now, if you got through all that, I’m sure you can read a bit more, get more information, and save yourself the troubles I had. Good luck!