Bitcoin is an open-sourced and decentralized cryptocurrency, which can also be known as digital asset or digital gold. It adopts the blockchain distributed ledger technology to generate one block every ten minutes. All the transactions generated within the ten minutes will be recorded in this block. The client wallet run by users will record the content of each block. In January 2009, it was released by a person nicknamed Satoshi Nakamoto and the first block came into being on January 9, 2009. From the perspective of investment, if it’s calculated at the initial price of 1 cent, the value has increased by more than 300,000 times so far.
There are lots of detailed introductions about Bitcoin. Input keyword “bitcoin” in Google, about 20.2 million results will pop up. Beginners may find the following materials particularly helpful:
- The official website: https://bitcoin.org/en/
- Getting started: https://bitcoin.org/en/getting-started
- Bitcoin at Wikipedia: https://en.bitcoin.it/wiki/Main_Page
- Bitcoin white paper: https://bitcoin.org/bitcoin.pdf
Bitcoin Core, one bitcoin wallet application, has implemented full nodes to form the backbone of the entire Bitcoin network with high security, privacy and stability. However, it has relatively few features and takes up a lot of disk and memory space. This version was introduced by the bitcoin community to integrate the latest and most stable functions of bitcoin.
Of course, since bitcoin is open-sourced, various “third-party” versions of wallets have been developed , including hardware wallets, etc. as follows:
- The well-known Bitcoin lightweight wallet Electrum
- KeepKey Cryptocurrency Hardware Wallet
The instructions for using Bitcoin Core are as follows:
Download the Bitcoin Core
Download the wallet from Bitcoin official website: https://bitcoin.org
Select wallet version. The computer system is Windows 7 64-bit in the example, so Bitcoin Core for Windows is selected. This version is also applicable to mainstream Windows series 64-bit system (win 7, win 10, etc.) nowadays.
Enter download page, click “Install”
Download the corresponding version. Download the 64-bit on the left for the 64-bit OS. If you are not sure about the system version, select 32-bit on the right, since it’s applicable to all Windows systems.
Unzip after download.
Enter the bin folder to run bitcoin-qt, which is Bitcoin wallet of windows system.
Start Wallet for the First Time
Start Bitcoin wallet and select data storage directory. Note: The Bitcoin blockchain data is nearly 206G so far, so the computer hard disk needs to be larger than such a size.
Depending on hardware configuration, the startup process ranges from a few seconds to a few minutes.
If firewall warning prompts, select network group and click “Allow”.
A window will pop up for the first startup, click “Hide”.
The “Overview” interface shows up.
Then, the program enters the synchronization and progress bar is shown at the bottom. The number of active connections to the bitcoin network are displayed on the lower right corner, which is normally 7-8 connections. The wallet synchronizes the blockchain according to the number of online wallets in the connected bitcoin network.
The sync time depends on different network conditions, ranging from about 20 hours to hundreds of hours. We adopted the telecom 20M fiber, so the sync time is about 28 hours. Till now, the file of Bitcoin blockchain is about 206G and the height is 552935 blocks.
Receive and Send Bitcoin
During the sync, the receiving interface can be accessed to generate a bitcoin address. Click “Request payment” to generate a bitcoin address.
Countless receiving addresses can be generated, select one of them and click “Show” to display the QR code corresponding to the address.
When creating a receiving address, set a remark label for this address for convenient management and application.
To receive bitcoin, enter the “Receive” window, double-click the created bitcoin address, copy the address and send the bitcoin to this address.
After 6 or more than 6 confirmations, the transaction of bitcoin receiving is completed. The transaction fee of this transaction is 0.00009 and the whole process costs about 40 minutes in the test. The duration of transaction confirmation is random with quite difference every time. There are two factors affecting the confirmation duration. The first is the transaction fee. The higher fee is set, the shorter time it will take. The second is the random block time of bitcoin blockchain.
After the transaction is confirmed, the currency can be transferred, click the “Send” window and paste the receiving address, set the transaction fees and click to send.
Click “Send” and a dialogue box will prompt to confirm. With 6 or more than 6 confirmation, the transaction is completed.
All the transaction records will be displayed on the wallet homepage and “Transaction” window.
Encrypt the Wallet
To encrypt the wallet, note: Remember the password, the encrypted wallet password is difficult to be cracked. It may cost more to find a professional agency to crack the password than the value of the saved bitcoin itself.
Confirm wallet encryption.
Confirm again. And Bitcoin Core will close to finish the encryption process.
Wallet Backup and Recovery
Two ways for wallet backup. The first one is to operate on the Bitcoin Core client.
Remember the backup directory, it’s recommended to copy the backup file to U-disk.
Another way is to directly copy the file “wallet.dat” in the blockchain data directory to U-disk.
Bitcoin wallet recovery: Copy the wallet file backed up to the bitcoin blockchain data directory (folder) to overwrite the file “wallet.dat”. For instance: If your hard drive is broken and the data cannot be recovered, buy a new hard drive and install the bitcoin client, copy the wallet backup file in U-disk to overwrite the file “wallet.dat” in the newly installed bitcoin wallet folder. The bitcoin will be recovered without being fear of getting lost. However, if you have never backed up the wallet file, the bitcoin in the original wallet will get lost forever.
Bitcoin Core, one bitcoin Wallet Application, is wallet program with basic functions, which supports basic operations of bitcoin transactions.
Of course, the shortcomings are also obvious since it takes too much local resources and demands U-disk for backup. Moreover, block sync needs to be conducted before each transaction. The security depends on the running computer. Since the computer runs tens of hundreds of real-time programs in the backstage, it’s difficult for non-professionals to judge whether there are security risks, so the level of security risk is relatively high.
If high value of bitcoin is stored, it’s better to choose the professional bitcoin hardware wallet, which has qualitative improvement in security and convenience.
Series of articles on bitcoin wallets at EastShore
- Intro and Tutorial for Bitcoin Core Wallet: https://www.eastshore.xyz/intro-and-tutorial-for-bitcoin-core-wallet/
- Intro and Tutorial for Bitcoin Lightweight Wallet Electrum: https://www.eastshore.xyz/intro-and-tutorial-for-bitcoin-light-wallet-electrum/
- Create Bitcoin Cold Wallet with Electrum: https://www.eastshore.xyz/create-bitcoin-cold-wallet-with-electrum/
- Review for Crypto Hardware Wallet Product KeepKey: https://www.eastshore.xyz/review-for-crypto-hardware-wallet-product-keepkey/