What is the best way to buy Bitcoins?

We are often ask "What is the best way to buy Bitcoins?"

There are of course several ways, and in the near future we will be posting a complete guide, but until then, one of the best answers is short answers is Coinbase.

If you are not familiar with Coinbase, they make the process of buying and selling Bitcoins a no brainer. Gone are the days of sending funds via some wire service and waiting...and waiting...and waiting for your coins to be deposited. Simply create a  Coinbase account, add your bank account info, and you are off to the races.

Buying Bitcoin has never been easier.  Simply:

• Sign up by clicking the link here
• Click on the "Buy/Sell" link on the right hand side of the page
• Click on the "Verify A Bank Account" link
• After your bank account is verified, go back to the "Buy/Sell" link and enter the amount of coins you want to buy and you are done!  

Once you have your Bitcoins you can of course spend or send them wherever you like.   A quick note here: your first purchase will take 4 business days to complete, Coinbase will keep you well informed via email throughout the process.  Once the first purchase is complete, you can add a credit card to your account as a back up payment source to become what they call Fully Verified, once this is done your future Bitcoin purchases will complete immediately!  This is one of the features that solidifies Coinbase as our #1 recommendation.

When it is time to trade your Bitcoins in for cash, the process is even easier. 

• Transfer your coins to your  Coinbase account if they are not already there
• Click on the "Buy/Sell" link
• Click on the "Sell Bitcoin" Tab
• Enter the amount Bitcoin you want to sell

Done! The coins will be sold and the proceeds from the sale sent directly to your bank account, no muss, no fuss.  Talk about market liquidity! 

What else does Coinbase do?

Coinbase is also much more that just a means for individuals to purchase and sell Bitcoins, they also offer merchant tools to make it easy for businesses to accept Bitcoins as payment for their goods and services. In addition, they offer a simple and easy way to add a Bitcoin donation button to your site, we proudly use this service and appreciate any help our readers are willing to provide to help us offset the expense here at Crypto Pros.

But is it secure?

In our opinion, yes.   They have implanted a top notch security system, stores your coins offline, run the site under a SSL certificate, have secured paper backups, and offer the option of utilizing two-factor authentication.

As we mentioned in the beginning of this piece, there are multiple ways to acquire and sell Bitcoins, but we find Coinbase to be the easiest and quickest option available today and highly recommend you start an account with them, which you can do by clicking the link here.

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Want to use Bitcoin at Amazon? Target? CVS? Whole Foods? HERE IS HOW!

One of the questions we hear all the time is where can I use Bitcoin to buy actual things?  

We posted earlier (viewable here) that Overstock.com is now accepting Bitcoin directly, and there has been quite a bit of buzz in the crypto currency community about this, and rightly so.  There are other options, and one that is convenient and offers a wide variety of options is Gyft, the mobile gift card company.

Gyft accepts Bitcoin as payment for gift cards redeemable at retailers and restaurants that range from Victoria Secret, to Amazon to Burger King with over 200 options in between!

You can purchase the gift card of your choice through their website or their Android app, and you can utilize either their Android and OS platform app at the retailer of your choice.

They even offer a loyalty points system that racks up triple points on Bitcoin purchases as compared to single point rewards for credit card and PayPal purchases. 

The wide variety of retailers, the loyalty program, and the simple interface makes Gyft a convenient way for you spend some of your trading and mining profits!

Check them out at www.gyft.com

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Give me liberty (and Bitcoins) or give me death! A libertarian take on Bitcoin.

Chances are if you are interested in crypto currencies such as Bitcoin and Litecoin, part of the reason for your interest is the decentralized and non-govermental control aspect...read no FED or other governmental bodies devaluing your assets though inflationary policies and other general mucking up of the markets.

A libertarian is commonly defined, at least in part, as one who advocates maximizing individual rights and minimizing the role of the state.

John Stossel has established himself as on of America's leading consumer reporters and investigative journalist.  He is also probably the most outspoken libertarian voices in the mainstream media today.

He shared his view on Bitcoin today in his column entitled "In Bitcoin I trust" on FoxNews.com, give it a read HERE

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Put Linux on Your Stick

When I decided to start mining part of my motivation was a interest in putting together a Linux computer.  As this would be a dedicated  miner CPU and storage speed was not of concern.  A entire operating system on a USB stick, how cool is that.   Overall the operation is quite simple.  Get a 1 Gig and a 8 (or more) Gig  USB stick, choose your distribution of Linux, and a software program to load your Linux distribution onto your USB and you are ready to turn that rig on!

Whoa, hold on, there is a little more to consider here.  Now there are probably some real technical gurus out there the will kill this, but they weren't around during my days of trial and error, so this is what worked for me.

The first thing that hung me up was the 32bit operating system.  Many guides revolve around this, but many were written before the release of the latest cgminer 3.7.2, which so happens to be a 64 bit distribution.  Now you can re-compile cgminer  to 32 bit, but this was a little over whelming for me(actually over my head), especially after many hours.  It was just easier to install 64bit and get over it. 

The other thing is patience!  From start to thinking you are going to start mining is going to take a few hours.  Not a lot of effort on your part, but there are reboots, installs, and updates that just take time due to the natural slowness of a USB stick.  Just remember you only paid $10 for this stick,so don't expect greased lightning.

So, choose your Linux distribution of choice.  I elected to use xubuntu - http://xubuntu.org/  Download it and save it in a spot you can remember.

I did have issues getting a 64 bit distribution installed with some installers, I won't name names but it would default to a 32 bit install and even when selecting the 64 bit file that I saved above it would give a error that this distribution is not accepted.

So, I found this piece of software did the trick for me, no games, no messing around.  You pick what you want and it will create your Linux bootable USB: http://www.pendrivelinux.com/universal-usb-installer-easy-as-1-2-3/  I used a 1 Gig USB stick for this.  Haven't seen any issues, and be sure to save this stick as you can use it to get multiple rigs started.

You may need to change your MOBO Bios to select USB to boot from, but my two different cards booted right up.  Xubuntu will ask if you wish to "try" or "install".  At this point put your 8 Gig USB in hit install, and you are off an running.  I did connect to the internet and selected the option to install updates during the install process, though there were more updates once completed.  Depending on your internet speed you should have a Linux computer ready to start installing necessary mining software and tools in a hour or two.

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To mine, or not to mine, that is the question 2

Well we covered the "for fun, no risk" should I mine aspect previously, but what next?

Do I go past a couple cards, or couple rigs, or wait for ASIC or FPGA  releases?   . If we knew all that information along with where the coin prices were going it wouldn't be any fun now would it?

Since I have started Litecoin mining difficulty has risen substantially.   In large part to all the press given to cyrpto coins in general and also based on the fact that GPUs are relevant in scrypt mining.  At least at the moment.  GPUs allow us regular "Joes" to run down to our local electronics stores and put together a mining rig in short order.   To the point there was a real shortage of GPUs the last few months, but that seems to be stabilizing at the moment.

FPGA/ASIC technology I am told is so much easier to manage, and does reduce power consumption in a positive way, but recent releases have proven that scrypt mining is not as easy in a FPGA environment and the gains are no where near that experienced for Bitcoin.   These release have yet to beat GPUs in anything other than maybe maintenance.


Mining is really not about your profit today, it should be about your potential for tomorrow.  I personally do not want to be like the person in the first official Bitcoin transaction who purchased 2 pizzas for 10,000 Bitcoins.  This person probably had a million of them, but still, a little patience would have paid of f big.  I just wonder if the pizza guy had patience.

GPUs will remain relevant for the time being, so additional GPUs I will add.  In the mean time be careful of the technology releases that claim to good to be true performance, if it were real it would be great but in a prepay situation, you have little leverage if the development ends without success, or the delivery keeps pushing due to lack of funds.  

I am personally in this for the long haul and playing with money I plan to either loose or make a healthy profit from.   It all depends on the coin Gods!

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Multipool.us: Best practices for auto-pool mining.

We have been testing out many of the auto-switching pools over the past few weeks.  As a result of that testing and setup, we have come up with how to use the multi-pool's auto payout threshold in conjuction with Cryptsy.  This will allow you to better trade out your volatile alts for less volatile BTC and LTC.

We have found the best results using www.multipool.us.  The interface is clean and conformed.  They provide many scrypt and SHA coins to mine ( see full list here).  Best of all is the way they calculate profitability, which is better than we have seen in any other auto-switching pools.

Profitability is calculated by taking into account the current price at which each coin is trading, as well as the difficulty of mining that particular coin. 

https://www.multipool.us/help.php

There are really 2 options when mining in an auto-switching pool.  The first option is to auto-sell coins as they come in at an exchange, like Cryptsy.  The second option would be to hold the coins for a better value.  Both options have pros and cons.

Option 1. Auto-sell

The trick to this option is to have consistent payouts from the pool. This will make it easy to sell the coins off without creating a wall and spiking the volume. To help you figure out where you should set your auto-payout threshold, take a look at the chart for the coin on cryptsy.  This will offer a good idea of the volume of the market and the average trade amount. Try to keep the payout close to the average order amount without having the payouts stack before selling.
We have found having many smaller trades helps insure your coins are sold and helps prevent selling your coins undervalued, as each auto-sell is based on current pricing.  If you have your threshold set too high you may end up holding a bag of coins that keeps declining in value.

if you are unfamiliar with the Cryptsy Auto-Sell feature please check this post out:
http://www.cryptopros.com/2014/01/cryptsy-auto-sell-feature.html

Pros

• Coins usually sell quickly.
• Sales of coins follow market closer.

Cons

• Potential profit loss if price were to go up.

Option 2. Hold

This option is very simple and could pay off, but the risk involved is much greater.  It involves choosing between holding your coins in the pool or transferring them to an exchange like Cryptsy (we always transfer to an exchange to be flexible if the market has drastic changes). After making your decision, you would then just wait and see what happens.

Pros

• Coin could take off with high profit gains.

Cons

• You could be left with a bunch of worthless coins.

Conclusion

We use option 1, we found that you will see more profits buy selling coins at the current value and taking advantage of the lower difficulties. This could change over time but for the near future it seems to be the right option.
We use Cryptsy more as a tool then a true exchange.  They have a huge amount of trading pairs and their auto-sell feature takes the headache out of auto-switch mining.

Multipool.us Coin List

SHA-265	Scrypt
Bitcoin (BTC):	Litecoin (LTC):
Freicoin (FRC):	FeatherCoin (FTC):
PeerCoin (PPC):	Mincoin (MNC):
Terracoin (TRC):	WorldCoin (WDC):
Zetacoin (ZET):	DigitalCoin (DGC):
	NovaCoin (NVC):
	LuckyCoin (LKY):
	Argentum (ARG):
	PhenixCoin (PXC):
	MegaCoin (MEC):
	BottleCaps (CAP):
	Cryptogenic Bullion (CGB):
	DogeCoin (DOGE):
	Diamond (DMD):
	Grandcoin (GDC):
	Mooncoin (MOON):
	Earthcoin (EAC):
	Lottocoin (LOT):

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