Learn Bitcoin and Cryptocurrency
There’s been a lot of talk about cryptocurrencies and a lot of confusion as to what they are. This is because there is a lot of confusion about currency in general and more specifically what money is and how it works.
Money is a tool pure and simple. It acts as a medium of exchange but in many ways it’s also like a form of energy. Powering the socio economic platforms upon which our world is built.
Money as they say makes the world go round as our world has evolved as a result of technological and social innovation spanning the agricultural industrial and now digital revolutions. So too has our currency changed in order to most efficiently power those platforms in order to transfer value incentivize work and reward innovation.
As the digital revolution gains momentum transforming almost all aspects of our daily lives a new platform is beginning to emerge which is decentralized collaborative and transparent highly fluid platform spanning energy production transportation manufacturing and communications.
Connecting everyone and everything in what has been described as the Internet of Things or by some as the third industrial revolution. As this platform takes shape however it is clear that our money must also change in order to most effectively plug into these new networks and capitalize on the tremendous opportunities they offer.
Why is Cryptocurrency Needed?
Our present form of money known as FIAT currency has some serious design flaws that does not make it compatible with these new technologies moving forward issued by central governing bodies within individual countries and circulated within the economy by a vast legacy network of banks and financial institutions.
This system becomes extremely cumbersome when we move online and transcend national borders. This is because each transaction must be validated and processed by these localized networks. This is why even today when information can move around the world instantly, a single payment from one country to another is slow, expensive and unreliable and can typically take anywhere from three to five days to settle for small payments and longer for even larger.
Clearly this is a problem as we move towards an Internet of Things which requires the instantaneous sharing of data monetized through instant micro payments in order to incentivize collaboration on the network. Then there is the wider issue of trust. As fiat currency has no value in and of itself other than its backing by the national governments.
We have no choice but to trust the government and politicians to adopt sound economic policy and effectively control the money supply so that the currency is not debased. Populations also have to trust the network of banks and financial institutions to act responsibly in their dealings in order to maintain the integrity of the overall financial system. However Government bailouts, growing debt and overall systemic and institutionalized corruption has seen that trust greatly eroded.
Brief History of Bitcoin
The idea of Bitcoin was not a new one. In fact many attempts had been made to create an electronic or purely digital form of money that could be transferred directly between bodies. However they had all failed and the reason they failed was because of what was known as the double spend problem.
When you send information electronically over a network like the Internet. What you are actually sending is a copy of that information. And whilst this is not such a problem when sharing or transferring information like a music file book or video it is a huge problem when transferring value like money because clearly you don’t want multiple copies of that money to exist which could be spent by other people.
This is why the internet has disrupted the music publishing and film industries but it’s had little impact on the core banking and finance sector. The simple fact is that when value is exchanged we require a so-called trusted third body to facilitate and validate that exchange. The Internet we have seen up until now therefore has largely been the Internet of information and not the Internet of value
The double spend problem existed in perpetuity until a pioneer by the pseudo name Toshi Nakamoto solved it. His solution was a combination of peer to peer technology cryptography and game theory in which an open and transparent record of all transactions was accessible to all participants on the network that validated transactions and prevented doubled spending to test the network.
Satoshi created a new form of currency called bitcoin and transferred some over to the newly created network. This first transaction was once known as the genesis block and included within it a powerful message that made it clear as to the motivation for creating the Bitcoin network. The message was a copy for a headline from a Times article 3rd of January 2009,” Chancellor on brink of second bailout for banks.“
Bitcoin is a new kind of money that works very differently from traditional money. Here is a brief introduction that covers some of the key facts you need to know about it.
Bitcoin is a decentralized digital currency, powered by a vast distributed computer network. No person, company or organization has any control over Bitcoin and only you have access to the money if you own it.
You can use Bitcoin like normal money, but it is really important to remember that you are responsible for the security of your wallet, as no bank or other financial intermediary ever has access to it.
You can send, receive, store and gift Bitcoin in a secure digital wallet, which you can download for free. Direct sending or receiving of transactions from person to person, for personal or business purposes.
When using Bitcoin Cash, each transaction costs less than a cent in microfee, and there is no need for a bank account, credit card, or other financial intermediary.
If you are storing large quantities, you should consider purchasing a hardware wallet to add an extra layer of security to your storage. You can also save money with Bitcoin, and if you are an entrepreneur, you can accept payments from customers in Bitcoin.
To accept Bitcoin as a business, you need two tools
- The first is a secure digital wallet where you can receive Bitcoin payments. You can accept Bitcoin and Bitcoin Cash as well as other cryptocurrencies such as Litecoin and Dash.
- The second is a secure digital wallet where you can pay your customers in Bitcoin Cash, Litecoin, Dash or any other cryptocurrency.
Is Bitcoin Anonymous
Bitcoin is not a privacy coin and the blockchain is public, meaning you can see all transactions as long as they are not linked to your identity. To keep your Bitcoin transactions more private, use a different address for each payment and you don’t have to share an identity by downloading a digital wallet.
When you send or receive Bitcoin you can use the automated tool such as a coin tumbler to improve your privacy.
It is also possible to but Bitcoin from special dedicated ATM’s and in person, with the latter of course having the most anonymity.
What do you Need to Buy Bitcoin
Aspiring Bitcoin investors need several things:
- Bitcoin wallet
- Currency exchange account
- Bank account
Do I need ID to Buy Bitcoin
Many of the world’s largest bitcoin exchanges such as Coinbase use a know-your-customer (KYC) platform for ID checks and verification. This has nothing to do with Bitcoin, and everything to do with creating a paper trail of ownership for Governments.
It should be noted that Bitcoin ATMs increasingly require a government ID card. It is also possible to obtain Bitcoin via a specialized ATM or P2P exchange, but any valid payment method that uses this method must be made through your account. Privacy and security are important issues for Bitcoin investors, and they are also important for Bitcoin users.
Is my Investment Safe?
Although it is obvious that your private key should be kept secret, criminals will try to steal it when they learn of your large holdings. Since there are no physical Bitcoins, it is usually a bad idea to boast of one’s largest holdings, and since it can be authorized as a transaction by anyone who has access to the private keys, such as anyone who has purchased a copy of the Bitcoin wallet or even a Bitcoin account on a private network.
Be aware that everyone can see the balance of the public key you are using, and therefore it is a good idea to keep significant investments in a private account that is not directly linked to your transactions.
Bitcoin can be used anonymously, but since all transactions are recorded publicly on the blockchain, user data can be identified. Anyone can view the history of all transactions in the blockchain, including names, addresses, phone numbers, email addresses and other personal information.
Is Bitcoin Private
International researchers and the FBI can trace all transactions made through the Bitcoin blockchain to other users online accounts, including their digital wallets. When someone creates an account on Coinbase, they must provide their identity, but when a person buys bitcoin, the bitcoin is tied to that person’s name. If you send to another wallet, you can still track the Coinbase purchase that connects the account holder’s identity to you.
Signing up for a cryptocurrency exchange allows you to buy, sell and hold cryptocurrencies.
Decentralized Bitcoin Purchase
For greater anonymity decentralized exchanges allow users to remain anonymous and not enter personal information. This feature can be important if you want to consistently trade in Bitcoin and other cryptocurrencies. There are many types of cryptocurrency exchanges, but there are many exchanges and intermediary platforms that do not allow the use of third-party intermediaries such as banks, brokerage agencies or financial institutions.
The exchanges that make this possible are decentralized, which means that there are no central checkpoints.
Although the system has the potential to be used for nefarious activities, it also offers valuable services such as to people living in countries where there is little or no government banking infrastructure to provide the government identification numbers needed for a bank or investment account.
It is important to use secure Internet practices when setting up a cryptocurrency account, including a unique, long password that includes your name, address, telephone number, email address and other personal information.
Bitcoin Trading Account
Coinbase offers Bitcoin and a growing number of legacy coins such as Litecoin, Zcash, Dash and Dashcoin.
The process is largely the same as setting up a typical broker account, but the information you need may depend on the laws that apply to you and the region in which you live.
Depending on the exchange, this may include your name, address, telephone number, email address and other personal information. If you decide to exchange your personal documents, they will be collected at the time of account opening.
To exchange to ensure your identity and legitimacy, you can add a payment option at the end of the transaction, such as a credit or debit card or PayPal account.
While Bitcoin is legal in the United States, some banks are not too friendly to the idea, questioning or even stopping deposits on crypto-websites and exchanges. While most banks allow deposits, it is a good idea to check whether they allow deposits on the stock exchange of your choice.
You can use your debit or credit card at one of the exchanges listed above or connect directly to your bank account. Although you can buy cryptocurrencies with credit cards, you should avoid this, as cryptocurrencies can experience volatility.
Cryptocurrencies and their exchanges have slowly become established in recent years, and it is important to research the fees and payment options to help you choose a barter and decide which payment option works best for you. Stock exchanges are growing considerably in terms of liquidity in their area, and you can buy bitcoin and other cryptocurrencies by opting for an exchange. You can also connect to these payment options using a bank account, credit card, debit card or other payment method.
Once you have found an exchange and connected to your payment method, you are ready to go. Cryptocurrencies and exchanges have now reached a point where they have a much higher level of trust and trustworthiness than ever before. What used to be considered a fraud or questionable is now so popular that it can be considered trustworthy and legitimate.
Cryptocurrency exchanges offer a range of orders for all types of investment opportunities, and almost all cryptocurrency exchanges offer market-cap orders. Of the above exchanges, Kraken offers the most orders, but they make it a point to limit your take-A – profit and stop-loss limits. They also offer stop loss orders and offer them at a much lower price than most other exchanges.
Getting an account on a stock exchange is actually all you need to do to buy bitcoins and other cryptocurrencies, but there are a few other steps you should consider for greater security. Bitcoin and cryptocurrencies are digital assets that need a place to store them more securely. Some exchanges offer the possibility of setting up recurring investments that allow customers to invest at the average cost of their investment of choice.
Personal Bitcoin Wallet
By having your cryptocurrency in your personal wallet, you have control over the private keys to your money. This also gives you the opportunity to store your money on a stock exchange and avoid the risk of it being hacked and losing your money.
Some wallets have more functions than others, some are for Bitcoin only, others offer the possibility to store numerous types of older coins. Some wallets also offer the option of exchanging one token for another, but some wallets do not, while others do.
Bitcoin Hot Wallet
While hot wallets are handy when you can quickly access your assets and make transactions, storing your private keys in an Internet-connected device makes you more vulnerable to hackers. If you don’t have enough security to deal with a hot wallet, your money can be stolen, which can happen in a number of ways. This may sound far-fetched, but it is not a rare occurrence and can lead to vulnerabilities when your wallet generates private key coins on your computer or other Internet-connected devices such as mobile phones.
However, wallets can be designed to be safe as long as precautions are taken, but minimum requirements should be taken into account. It would not be wise, for example, to brag about how much bitcoin you hold by using a little security or keeping your bitcoins in a hot wallet.
One could compare a hot wallet to a checking account, but conventional financial wisdom would say that you should not put money in a checking account unless most of your money is transferred to a savings account or other investment account. A wallet is best used for active trading of small amounts of cryptocurrencies or cryptocurrencies on an exchange.
The same could be said for a hot wallet, and hot wallets include mobile, desktop, and Web wallets. As mentioned above, a change to a Exchange is a custodian account provided by the Exchange, but the wallet user is not responsible for the private cryptocurrency keys that are in that wallet.
If your wallet is hacked or your account compromised, you lose all your money, whether it is through a hacked wallet, a compromised account or even a malicious attack.
Bitcoin Cold Wallet
Cold wallets are offline storage facilities. Cold storage is more secure than a traditional wallet. It involves storing bitcoins offline—that is, entirely separate from any Internet access. Keeping bitcoins offline substantially reduces the threat from hackers.
How to Buy Bitcoin in the US
Although Bitcoin has attracted a lot of attention in the world of financial investments, many people in the United States do not know how to buy it. Here’s all you need to know before you start buying bitcoin in the US, and it’s as simple as signing up for a mobile app.
The Bitcoin balance is maintained by a long string of numbers and letters connected by a mathematical encryption algorithm used to create Bitcoin balances.
Bitcoin Public and Private Keys
The public key is the place where transactions are deposited and withdrawn, and there is also a key that appears as the user’s digital signature. The private key should be private and only be used to authorize Bitcoin transfers. In some cases, users protect their private keys by encrypting the wallet with a strong password or by choosing other storage options such as storing your wallet offline.
Buying Bitcoin Legally in the United States
If you decide to buy Bitcoin online in the US, you should have a clear understanding of when and where you can access your digital wallet.
When you buy or sell Bitcoin, verify your identity using multiple personal documents, including your driving license, passport, social security number and other documents.
PayPal and other financial service companies now offer a facility to buy bitcoin legally in the United States. Visa and Mastercard no longer block verified transactions.
The availability of any payment methods depends on the jurisdiction you choose and the exchange you choose, as well as the amount of Bitcoin available for purchase.
Coinbase is one Bitcoin exchange that allows US Residents to you to buy and sell Bitcoin. Users click on the “Buy” tab to buy and click on “Sell” to sell it. Choose the currency you want to use and choose how you want to buy or sell it, as well as the type of currency you want to buy or sell.
Credit and debit cards are the most user-friendly payment methods, but tend to require ID and can also charge higher fees than other methods. Depending on the exchange, you can pay with a credit or debit card, Bitcoin or any other digital currency.
Once you have set up your wallet with your payment method, you will need a list of places where you can buy Bitcoin in the United States, as well as a description of each of these places.
Bitcoin exchanges are similar to currency markets, but remember that bitcoin exchanges and bitcoin wallets are not the same. A stock exchange is a digital platform where Bitcoin is exchanged for other cryptocurrencies such as gold, silver or other precious metals. An online marketplace called Exchange allows users to buy bitcoin and other cryptocurrencies that they use to buy shares. This is the most common form of exchange where Bitcoin can be exchanged in the United States.
Exchanges offer users a variety of options for their primary business, even if they do not use the main business of the exchange itself, such as shares.
US Bitcoin Wallet
While security must be the top priority when choosing a Bitcoin wallet, you can opt for one with a multi-signature function. There are many well-established exchanges that offer solutions to stop this, and it is therefore advisable to transfer Bitcoins into a secure wallet.
While all wallets must be safe, some purses do not encourage the use of a single – sign – on their wallets. Therefore, if you choose a Bitcoin exchange or wallet, do your due diligence and check security issues.
Exchanges like Coinbase remain the most popular way to buy bitcoins, but that’s not the only way. Below is a list of other processes that Bitcoin owners in the US can use in addition to Coinbase and other popular exchanges. Besides Coinbase, Coinmania, CEX, IO and Gemini are other popular exchanges.
After creating an account, users can make Bitcoin purchase or sale requests, including information about payment methods and prices. They then search for offers to buy and sell and choose the company they want to do business with. Individuals can deposit cash into the machine and use it to buy bitcoins, which are then transferred to a secure digital wallet.
Although P2P exchanges do not offer the same anonymity as decentralized exchanges, they do allow users to search for the best deals. Local Bitcoins facilitate this aspect of trading, and many exchanges also offer a valuation system. Users have the opportunity to rate potential trading partners for each transaction and rate companies on a scale of 1 to 10.
Buy Bitcoin Without ID or KYC
The main advantage of Bitcoin is the privacy it provides, not only in terms of transaction fees, but also the relative anonymity of the transaction.
However, Bitcoin users will need to create an app that allows them to register and make transactions with their Bitcoin. As a result, all Bitcoin transactions remain technically anonymous yet exchanges and wallets require significant ID and KYC checks.
China cracked down massively on bitcoin. First, the government blocked access to so-called “ICOs” (offshore companies) in China, such as Bitfinex, Mt. Gox, Bitstamp, and Bitpay.
Next, it cut off access to offshore bitcoin exchanges and closed all bitcoin exchanges in mainland China. One of the main reasons China has imposed restrictions on Bitcoin is that the government fears the currency could be used as a tool for tax evasion and regulation.
Other nations, including the US, the European Union, the UK and Japan, are likely to impose restrictions on the use of Bitcoin. After all, the government limits everyone’s ability to run a “bitcoin exchange” in China, but only for a limited period of time.
In the United States, the Internal Revenue Service has begun targeting Bitcoin as an asset. This is to ensure that users of Bitcoin in the US pay tax on the sale. The IRS uses subpoenas to obtain information about U.S. accounts, including those used to hold Bitcoin, as well as the names and addresses of those who use them.
Other US regulators are cracking down on Bitcoin, too, and the US Securities and Exchange Commission is trying to treat Bitcoin as if it were cash. Therefore, Initial Coin Offering (ICOs) are subject to the same tax rules as other financial transactions.
It is highly unlikely that the US would ever ban the use of Bitcoin, but in the future it will probably regulate Bitcoin and try to prevent the currency from leaving the US. Bitcoin has become a widely used currency in many parts of the world, particularly in Asia and the Middle East, and is becoming the most popular and widely used currency – in Europe and Asia.
However, it is possible to increase privacy by using Bitcoin and registering digital accounts associated with Bitcoin with offshore companies.
Offshore Company Structure for Bitcoin
Offshore companies can be a very effective way to protect the privacy associated with Bitcoin. An offshore company then opens an account with a cryptocurrency exchange and transfers all Bitcoins to an offshore bank account.
The company’s founder then appoints an authorized distributor for the international company, and the bitcoin is converted into cash to pay his salary and consulting fees. Profits from Bitcoin trading are tax-free and taxed at the federal and state levels, provided the international company is properly structured.
The money can be transferred to a domestic bank account, and the value of the Bitcoin would escape national tax. If the transaction is small enough, the tax deductions associated with owning an offshore business may be sufficient to cover the taxes incurred.
The value of the Bitcoin can be withdrawn using an anonymous debit or ATM card and the card should be issued to a bank account of an offshore company.
Offshore Bitcoin Privacy
The main purpose of this strategy is to maximize your financial privacy while using Bitcoin. There are numerous legal strategies to fund an offshore company with Bitcoin, but this is a step in the right direction when it comes to financial privacy. Bitcoin offers many advantages over other cryptocurrencies such as Bitcoin Cash, Litecoin, Ripple and Ethereum.
Offshore Company with Bitcoin
There are numerous legal strategies to fund an offshore company with Bitcoin, but this is a step in the right direction in terms of financial privacy. However, this strategy may be the best option to maximize the benefits and privacy of Bitcoin.
The first option for transferring Bitcoin offshore can be used if the Bitcoin is held by a person in their own name. In this case, an international company could be established abroad, and Bitcoin can then be transferred from an onshore account to an offshore account of the offshore company.
The same scenario applies if the Bitcoin is held by a domestic company and Bitcoin can easily be transferred from the onshore company to the offshore company. The choice of offshore jurisdiction is really important for the application of this strategy.
Certain countries have favorable privacy laws, which, when combined with Bitcoin, can be even more effective than those in other countries. Create an account with an offshore company such as the Cayman Islands, Bermuda, Panama or the United Arab Emirates.
You can then transfer money from your personal broker account to the broker’s or offshore company’s account by internal transfer. If you have a dealer who has opened an agent account, you can open an agent account in the United States, Canada, Australia, New Zealand or any other country. You can then transfer Bitcoin from your personal broker accounts to your private bank account and from that account to your Bitcoin, through internal transfers, to the broker account.
This is because internal transfers are not regulated in the same way as external transfers. The key to the success of this strategy is to use the same broker as your private bank account and the internal transfer account of your broker or offshore company.
As a result, most strategies for financing Bitcoin through offshore companies will offer multiple layers of legal separation for Bitcoin. This may include overlaps with different offshore companies, but in general this strategy provides more protection.
Buy Bitcoin Overseas
You can also move your money abroad to buy Bitcoins, but only in a local currency. For example, it is possible to “buy” local currencies, which can then be converted into Bitcoin.
Bitcoin can then be transferred to an international company and converted into hard currency to make purchases at will, and then converted back into the local currency to buy goods and services.
Bitcoin can also be passed on to family members or trusted friends who live abroad. These friends or family members can then transfer Bitcoin to an offshore company and convert it into the local currency. It is also possible to buy easily and sell to agents abroad, as well as transfer money back and forth between the two countries.
Bitcoin is then placed in an international company and the money from the sale can be used to buy another bitcoin and transfer money back and forth between the two countries.
International companies (IBC) can also be set up as investment companies and there is a loan agreement on commercial terms.
International companies can also be established in countries where such an agreement does not exist. It is very difficult for anyone to know who owns an international company if the country does not have an investment agreement with the parent company of the company or any other jurisdiction in the world.
Dual Structure Offshore Bitcoin
One of the main advantages of offshore companies financing Bitcoin is the ability to establish dual structures. An example of a dual structure would be a private offshore foundation holding the shares of an offshore company.
This strategy is beneficial because it creates a clear separation between the owners of the Bitcoins. Bitcoin can then be transferred as share capital to an international company, and Bitcoin donations can be made to the foundation on a regular basis. Private foundations can also be established as non-profit foundations in the United States, Canada, Australia, New Zealand and other countries.
Another option that offers a higher level of security is the creation of two different international companies. The first international company would be used for general and long-term investments. These investments would offer high risk and potentially high returns, but would not only be speculative, but also offer a higher level of financial security than a private foundation.
The first international company would be financed by Bitcoin, and the second international company would set up a trading company and trade Bitcoin on the international market.
If this question is asked, the buyer can truthfully state that he is not yet entitled to return the goods. The advantage of this strategy comes into play if you want to avoid converting money into bitcoin and then redeem it in an offshore bank account. These funds would then be used for investment in the international trading company and if the investment of the first international company does not pay off in a very long time, it would be invested abroad.
Alexander Bentley leads Remedy Investments™ a private equity fund specializing in operational real estate. Remedy Investments™ has significant expertise in developing Luxury ApartHotels across Europe and the wider APAC region.
Alexander Bentley is the creator & pioneer behind Remedy Wellbeing Hotels & Retreats. Under his leadership as CEO, Remedy Wellbeing Hotels™ received the accolade of Overall Winner: International Wellness Hotel of the Year 2022 by International Rehabs.
Because of his incredible work, the individual luxury hotel retreats are the world’s first $1 million-plus exclusive wellness centers providing an escape for individuals and families requiring absolute discretion such as Celebrities, Sportspeople, Executives, Royalty, Entrepreneurs and those subject to intense media scrutiny.