Monthly Archives: December 2013

The Truth About Change, Bitcoin, Dollars, Gold and Silver

One truth about change is, it’s committed people that deliver change through their actions.

English: Young Nelson Mandela. This photo date...

Change makers are usually seen as a bit different, they are challenged at every stage, sometimes ridiculed or criminalised (Nelson Mandela served 27 years in prison for wanting to change the apartheid regime in his country). But if the change being driven is right, at some stage, a tipping point is reached and change is adopted, sometimes universally.

Many amazing things have happened and changed in the world in the last twenty years that just fifty of years ago seemed impossible.

Today I can share my thoughts and the thoughts of others with a few clicks of a mouse and a connection to the internet. I can share videos, games, pictures, comments, ideas, theories, hate, love, joy, humour, lies and hope. A sci-fi dream come true right here in 2013.

Today, Bitcoin is a fantasy, why?

bitcoin

bitcoin (Photo credit: Sean MacEntee)

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Litecoin Is To Silver As Bitcoin Is To Gold

I’m really pleased to share the first ‘Guest’ post on BitcoinCoach.co.uk.  

The author (Kirsty Bell) is someone I admire enormously. A proven academic and business woman age 24!

What this lady doesn’t know about digital life, commerce and marketing is not worth knowing, I (Daren Forsyth) have been in the digital sector for 18 years and Kirsty is one of my main “go to’s” for opinion. You can keep up with and follow Kirsty on Twitter

In this post, Kirsty sets out a step by step process to buy Litecoin within 24 hours, without debit cards, Paypal or Ebay (steer clear of these methods to buy crypto currency). It’s a great read, precise and informative. I hope you enjoy it and it helps you in someway.

Thank you Kirsty!

Litecoin IMG_3351

How to get your first Litecoin in 24 hours

The rapid increase in Bitcoin’s value has captured the attention of the media and the imagination of the public, fuelling an increased trading velocity and also undoubtedly helping to drive the value of the cryptocurrency to even greater heights.

The focus on Bitcoin has also shone a light on other cryptocurrencies and their potential to co-exist with or even usurp Bitcoin. There are currently around 200 official or de facto currencies in use around the world, so I believe that there is the potential for at least as many peer to peer currencies. At present, Wikipedia lists 37 active cryptocurrencies in use (http://en.wikipedia.org/wiki/List_of_cryptocurrencies).

What is Litecoin?

Perhaps the best known of these Bitcoin siblings is the Litecoin (https://litecoin.org/). Litecoin (LTC) is a peer-to-peer internet currency which is also based on the Bitcoin protocol, but it is easier to mine and enables faster transactions. The Litecoin network is scheduled to produce 84 million Litecoins, in contrast with the 21 million Bitcoins which will eventually come into circulation.

As soon as I heard about Litecoin, I set myself the challenge of getting my hands on some.

My first Litecoin

As anyone who has ever tried to buy Bitcoins can attest, buying cryptocurrency isn’t quite as simple as you might imagine. You can’t go to your local bureau de change and ask them for a few BTC or some LTC. Well, you could try, but the chances are you would receive a few raised eyebrows and not a lot else.

Litecoin provides non-reversible transactions, so payment providers like credit card companies and PayPal will not facilitate a direct purchase of Litecoins. The risk of the purchaser reversing their payment is just too high.  I have also read unfortunate stories Bitcoin or Litecoin being sold via eBay, where the seller has received payment and transferred the coins, only for the buyer to mark their order as not received and instigating a chargeback.

Image representing PayPal as depicted in Crunc...

Image via CrunchBase

This is a detailed explanation of how I bought my first Litecoin. It is far from being the easiest way of buying Litecoin. It is definitely not the cheapest way of buying Litecoin. However:

  1. It works.
  2. It takes less than 24 hours the first time, and less than 10 minutes every time after that.
  3. You don’t need a bank card and you don’t need to make any bank transfers (a PayPal account will do).

Step 1. How to get a Litecoin Wallet

The easiest part of buying Litecoin is getting a Litecoin wallet.

I already use, and trust, BTC-e, a Bulgarian cryptocurrency exchange where I have previously traded Bitcoin. The registration process with BTC-E.com is simple, and takes just a minute or so. BTC-e will send you an email to confirm your email address, and once you click the confirmation link in the email, you become the proud owner of a place to store your Bitcoin and Litecoin.

Step 2. Buying Litecoin using GBP – getting the right currency

Buying Bitcoin or Litecoin when you are based in the UK adds an extra level of complication. Most exchanges and payment providers won’t actually accept GBP. I am certain that there are some that do, but I ruled a number of them out due to limited information about how trustworthy they were. There is a lot of out of date information on the internet about how to buy cryptocurrency, with many sites reporting that you can buy currency on Mt Gox or Intersango using GBP, but this is no longer the case.

As I was mainly concerned with getting my Litecoin quickly rather than cheaply, I decided to convert my GBP into USD by purchasing a UKash voucher. UKash (https://www.ukash.com/en-GB/) is a fairly well-known payment provider, and you can buy their voucher codes in many newspaper shops.

There are numerous websites where you can buy UKash in USD denominations. After a bit of searching for reputable sellers, I decided to buy mine from http://www.pcgamesupply.com/.  Using the basic signup process without verification, I was only allowed to purchase the $50USD denomination voucher. By verifying your account, logging in with Facebook, or by being a long standing customer, this limit increases, but as I mentioned before, I wanted to try and get my hands on some LTC quickly. (Note: PC Game Supply is based in Calgary, Canada, so make sure that your card provider is ok with you making transactions with a Canadian seller).

Step 4. Turning UKash into CashU

Now that you have a UKash code, you can register for a CashU (https://www.cashu.com) account (CashU is a prepaid payment provider, apparently very popular in Arabic countries.) I registered for a Consumer account which took a couple of minutes, and didn’t require any ID verification.

Simply choose “Add funds” > UKash vouchers, and enter the USD amount of your voucher. Then copy your UKash code into the box along with the voucher value, your email address and the captcha code. Click “Pay Now”, and you’re one step closer to buying Litecoin!

Step5. From CashU to Bitcoin Nordic

Please note: the first time you make a transaction with Bitcoin Nordic (https://bitcoinnordic.com/index_en.html), it can take 24 hours to receive your currency. After the first transaction, you tend to receive your coins within 5 – 10 minutes.

Turning your CashU deposit into Bitcoin is a relatively straightforward process, but it is also one of the most expensive parts of the transaction. Bitcoin Nordic is a Denmark company with a good online reputation (which is why I chose it for this experiment). My main issue with Bitcoin Nordic is that it charges a whopping 15% of the total transaction value to turn your CashU into Bitcoins.

When you make the transaction on Bitcoin Nordic, enter your details and your wallet address (I used BTC-e, as mentioned above).

Step 6. The Home straight! From Bitcoin to Litecoin

All being well, within 24 hours you should be the proud owner of some Bitcoin, sitting safely in your BTC-e Wallet.

Once logged into BTC-e, choose the LTC / BTC option; fill in the amount of Litecoin you want to buy, and the price (in BTC) that you want to pay. Once your order has gone through, the Litecoin will be transferred to your wallet, minus the 0.2% BTC-e trading fee.

It’s been a long journey, but you’re now the owner of an obscure cryptocurrency. Congratulations!

Litecoin IMG_3359

A note about transaction costs

You will not have failed to notice the massive transaction costs incurred at every stage of this process, which at the time of the transaction amounted to around 25% of the total amount initially deposited. Fortunately for me, the value of Litecoin has since increased to a level where I have managed to make a small profit, but there are massive inefficiencies in the process of purchasing Litecoin. There are many other, more efficient ways of buying Litecoin than the method detailed above, but they often involve very high minimum transfer amounts or take several days to process.

As the market for crypto currency grows, so will competition in the payment processing sphere, making transactions cheaper and faster. Having a large number of reputable and established payment providers would also help to increase trust in cryptocurrencies themselves and hopefully help to stabilise the value of the currency.

Card / Paypal into UKash

PC Game Supply – $50 USD Ukash + activation fee = approx. £36 (fee approx. 15%).

UKash into CashU

Foreign exchange rate defined by UKash + 7% + 2%

CashU into Bitcoin Nordic

Bitcoin Nordic and partners will keep a total commission of 15% of your transaction when using CashU, or 9% of Cash deposits. 

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#CyberMonday, The UK Prime Minister in China and NatWest is Down

The start of another week, the week after Bitcoin news and stories reached mass media (predicted on this blog) outlets. The best story, well the one people in my social circles was “Did you hear about the guy who lost his hard drive with £4.5 Million of Bitcoin?” It made me smile, great story, the lesson from that story whether bitcoin or not, back up your hard drive! now! 🙂

Of course the other big story was Bitcoin reaching $1200 per coin. Lots of people now feel Bitcoin is out of their reach. It’s not, you can buy tiny bits of Gold as well as a whole nugget. I bought 1 BTC this week at $1014, I’m in for the long term. What does “long term” mean ? For me, more than five years. If you do buy now, don’t watch the price everyday, forget about it, just like your premium bonds or endowment policy.

I made another “call” this weekend. Dr Sue Black asked on saturday night, why UK political leaders were in China. My answer was “the RMBChina’s currency. If you heard the 6pm News on BBC Radio 4 tonight, you will also know, I called it right. The Chinese want us (the world) to buy and invest into their currency, sometime soon. That’s massive news for the world and Bitcoin. After all, the biggest buyers of Bitcoin last week were the Chinese.

For me, this is another  global political event that further strengthens the likelihood of Bitcoin rising in value long term. This is my current rationale to buy (and spend) Bitcoin.

If I bring you back to today before saying once again ” You will have a digital wallet by 202″ that will not involve your bank”. If you are NatWest you are not buying anything online right now (at time of writing). That’s poor isn’t it? You can’t shop on #CyberMonday because your banks online operations have melted.

Finally while talking about Banks. They are the next hurdle for Bitcoin. The UK banks are blocking our ability to buy and exchange Bitcoin in the UK. They are basically tied down by anti money laundering rules. Did you know if you pay more than £1000 cash into your bank account, you are reported to a database that legal institutions can search, the theory is you could be a drug dealer or terrorist because you have more than £1,000 cash to pay in. I don’t know about you, but I find that quite sad because I don’t think the world is that polluted by criminals. I love the feel of cash in my pocket.

Tomorrow, there will be a guest post on Litecoin and how to buy them.

If you think about Bitcoin as Gold, Litecoin is Silver, easier, cheaper to mine and worth a lot less, but still very useful and tradable. I hope you come back to read it.

In between blog posts you can follow http://twitter.com/bitcoincoach – I always reply on Twitter

Happy Monday!

The bitcoin logo

The bitcoin logo (Photo credit: Wikipedia)

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