Table of Contents
Introduction 1
About This Book 1
Foolish Assumptions 2
Icons Used in This Book 2
Beyond the Book 3
Where to Go from Here 3
Part I Bitcoin Basics 5
Chapter 1 Introducing Bitcoin 7
The Origin of Bitcoin 7
Getting Technical 9
Bitcoin as Currency 10
Bitcoin as a currency tool 11
Bitcoin and retailers 12
Bitcoin and consumers 13
Figuring Out How Bitcoin Works 14
Using Bitcoin Anonymously 15
Introducing third-party anonymity 16
Protecting privacy 16
Demonstrating fungibility 17
Trusting the Idea of Bitcoin 18
Trusting bitcoin technology 19
Trusting bitcoin as currency 20
Chapter 2 Buying and Storing Bitcoins 21
Getting Started: How to Obtain Bitcoins 21
Getting registered on an exchange 22
Know-Your-Customer: Passing the KYC 24
Figuring out exchange rates 24
Understanding peer-to-peer versus regular exchanges 26
Storing Your Bitcoins: Being Safe While Using Exchanges 28
Using two-factor authentication (2FA) 30
Understanding liability 31
Encrypting Your Bitcoins 33
Choosing a passphrase 33
Beware malware 34
Storing physical bitcoin 35
Buying Bitcoins in Person 36
Your bitcoin wallet address 36
Meeting in public places 38
Paying premium rates 38
Choosing a payment method 39
Hot Wallets and Cold Storage 40
Securing user funds 41
Preventing exchange hacks 42
Chapter 3 Bitcoin Pros and Cons 43
Adding Up the Pros of Bitcoin 43
Financial freedom 43
Security 47
Removing fraud 48
Transparency 50
Low fees 51
Subtracting the Cons of Bitcoin 52
Awareness and understanding 52
Trust 54
Risk and volatility 57
Limited use (for now) 58
Chapter 4 Making Money with Bitcoin 61
Mining Bitcoins 61
How bitcoin mining works 61
A short history of bitcoin mining 62
Trading Bitcoins 64
Day trading versus fiat 64
Day trading versus altcoins 66
Crowdfunding with Bitcoin 67
Understanding ICOs and IPOs 68
Offering company shares and dividends 69
Holding Bitcoins for the Future 69
Driving your investment vehicle forwards 70
Hoarding your booty 71
Earning Bitcoin 72
Earning through forums 72
Earning through jobs 74
Earning through faucets 75
Part II Banking with Bitcoin 77
Chapter 5 Your Bitcoin Wallet 79
Unlocking Public and Private Keys 79
Getting Your Hands on a Bitcoin Wallet 81
Software wallets 82
Hardware wallets 83
Paper wallets 83
Web wallets 86
Setting up a Bitcoin Address 87
Grasping Your Wallet Securely 88
Securing mobile wallets 88
Securing online wallets - or not 89
Securing paper wallets 90
Chapter 6 Bitcoin Transactions 91
Figuring Out How Transactions Work 91
Receiving Confirmations 94
Regular six confirmations 95
Double-spending 96
Zero confirmations 97
Calculating Bitcoin Fees 98
Looking at Transaction Speed 99
Understanding Mining Fees 99
Dealing with Multi-signature Transactions 100
Chapter 7 The Blockchain 103
Recording Transactions 103
Understanding Blockchain Analysis 105
Seeing Beyond "Just Transactions" 106
Working with Blockchain Applications 106
Moving Ahead to Bitcoin 2.0 108
Part III Using Bitcoin in Business 111
Chapter 8 Using Bitcoin in Commerce 113
Selling Your Goods for Bitcoin 113
Selling on auction sites 113
Creating your own online store 114
Selling on BitcoinTatk forums 115
Looking at Bitcoin Payment Solutions 116
BitPay 118
Coinbase 119
Accepting Bitcoin Payments for Your Store 120
Online stores 120
Brick-and-mortar stores 121
Chapter 9 Staying on the Right Side of Legal 123
Understanding Bitcoin and Taxation 124
Taxable countries 125
Getting help with bitcoin taxes 128
Bitcoin Regulation Around the World 129
Regulating with BitLicense 130
Regulating elsewhere 131
Money transmitter licenses or not? 131
Chapter 10 Bitcoin Security 135
The Bitcoin Network: An Overview of How It Works 135
What makes it secure 136
The role of bitcoin nodes 137
Defending Bitcoin from Hackers 137
Hacking bitcoin services 138
Watching Out for a 51 Percent Attack 140
Theorycrafting the 51 percent attack 140
How likely is a 51 percent attack? 141
Double-Spending 142
Theorycrafting the bitcoin double-spend attack 143
Chapter 11 Mining for Bitcoins 147
Heading Down the Mine 148
Understanding How Bitcoin Mining Works 149
Cloud Mining 150
Advantages of bitcoin cloud mining 151
Disadvantages of bitcoin cloud mining 151
Risks associated with bitcoin cloud mining 153
Securing Bitcoin with Mining 153
Starting Your Own Mine 154
Getting the right hardware 154
Calculating your costs 156
Part IV The Part of Tens 159
Chapter 12 Ten Great Ways to Use Bitcoin 161
Use Bitcoin as an Investment Vehicle 161
Use Bitcoin As An Educational Tool 162
Go and Spend Bitcoin for Everyday Needs 163
Indulge in Luxury Expenses with Bitcoin 163
Support Charities with Bitcoin 164
Gamble Online 164
Invest in Precious Metals: The Gold Standard Reinvented 165
Give It Away! The Joy of Gifting Bitcoin 165
Pay Bills 165
Use Bitcoin as a Social Experiment 166
Chapter 13 Ten (or So) Other Crypto-Currencies 167
Litecoin: The Silver to Bitcoin's Gold 167
Dogecoin: Such Wow, Much Fun, Very Coin 168
Dash: Formerly Known as Darkcoin 168
Ripple: A Different Type of Crypto-Currency with Potential 169
Peercoin: Introducing Proof-of-Stake 169
StartCOlN: Crowdfunding 170
NXT: Using Proof-of-Stake for Transaction Consensus 170
CasinoCoin: Branding for Casino Users 171
Chapter 14 Ten Online Bitcoin Resources 173
The Bitcoin Wiki 173
BitcoinTalk Forums 174
Bitcoin subReddit 174
Bitcoin.org (and bitcoin.com) 174
Bitcoin News Sites and Blogs 175
Mainstream Media 175
Bitcoin Documentaries 176
Bitcoin Price Charts 176
FiatLeak 177
CoinMap and CoinATMRadar 177
Index 179
