Once laughed at, Bitcoin has emerged as the world’s single largest cryptocurrency. An increasing number of people worldwide are now engaged in various Bitcoin related activities. Several have entered the lucrative Bitcoin mining chain while others have jumped the bandwagon as investors.
The very first step every Bitcoin aficionado needs to do is to create a bitcoin wallet account to store this cryptocurrency. It is very important to choose an appropriate Bitcoin wallet, best suited to your needs. Deciding how and where to store your precious Bitcoins can often be arduous. One needs to prevent it from malware and hackers. Fast access to the blockchain (where Bitcoin trading occurs), foolproof security and ease of use are the main considerations while choosing a Bitcoin wallet.
Before going into further detail on how to create to create bitcoin wallet account, let’s gather some interesting information about Bitcoins.
What is Bitcoin
Created by Satoshi Nakamoto. Bitcoin is a virtual currency (also known as cryptocurrency) which can be created and stored digitally. Bitcoins aren’t printed, like dollars or euros or any other physical currency. Rate of 1 Bitcoins is equal to 1000 USD ( 80,000 INR)
What is Bitcoin Wallet
Before commencing mining and trading, you will require a Bitcoin account. A Bitcoin account is called Bitcoin wallet. You can open your Bitcoin account with any trustworthy Bitcoin exchange and download the wallet they offer online. Study the various Bitcoin wallets on offer. All Bitcoin exchanges offer their version of wallet or account. It is important to verify the source of the Bitcoin wallet/ account since the industry is under siege by legions of hackers.
What is Bitcoin Address
The phrase Bitcoin account has become ambiguous over the years. A Bitcoin wallet has unique identification and is also known as Bitcoin account or Bitcoin address. However, several Bitcoin exchanges open a ‘Bitcoin Account’ where people can buy Bitcoin or even sell Bitcoin for cash.
What is Satoshi
The fraction of every Bitcoin is called Satoshi. You can also take it as the value of cent in dollar or paisa in Indian Rupees.
Types of Bitcoin accounts/wallets
Bitcoin is a cryptocurrency. It does not exist in the physical world in the form of coins and banknotes. It cannot be carried in your purse or wallet like cash. Bitcoin owes its existence to the Internet and the cyber world. Hence, it can be stored and traded online only. There are three types of Bitcoin wallets.
1. Web based: A web based Bitcoin account is held on a host server of an exchange or service provider. It can be accessed online only. It is protected by complex user names and highly encrypted passwords to offer maximum security. Ideal for miners and frequent Bitcoin traders, a web wallet can be accessed from any location, provided you are connected to the Internet. A web wallet is connected 24/7 to the blockchain. It uses the entire blockchain which makes transactions faster.
The flip side is, a web-based wallet can be susceptible to hackers. You will also need to verify credentials of the company or exchange that offers a web-based Bitcoin account. Its operation is somewhat similar to net banking.
2. Software wallet: A software wallet or account for Bitcoin is the most popular. It involves downloading the wallet on your PC, laptop or mobile. A software based Bitcoin wallet is similar to m-wallets and e-wallets used for online transactions. A software wallet is also protected by complex passwords. Some software wallets download the entire blockchain ensuring maximum security. Others use the blockchain partially and are not as secure. For flexibility of use, software Bitcoin wallets can be downloaded on multiple devices. Software wallets are available for Android and Mac iOS smartphones.
3. Hardware wallet: The most secure way to store Bitcoins, a hardware wallet is a physical device that can be connected to the blockchain whenever required. It is hardware specifically designed to hold your Bitcoins. A hardware wallet can be ‘hot’ or ‘cold’. A ‘hot’ hardware wallet is constantly connected to the Internet. A ‘cold wallet’ can be connected to the blockchain when required. You are in complete control of your Bitcoins since the device is protected by passwords. They generate security keys automatically to offer a greater degree of protection against malware and hackers. You can purchase hardware bitcoin wallet from here
Losing a hardware Bitcoin wallet is disastrous- it means losing all your Bitcoins.
How to Create Bitcoin Wallet Account
Creating Bitcoin wallet account is as easy as creating an email account. All you have to do is fill up the registration form and confirm your email id.
There are the number of bitcoin wallet websites available out there on the internet on which you can create an account for Ex. CoinSpace, CoinBase, GreenAddress etc. You can also find the complete list of bitcoin websites here
Creating Multiple Bitcoin Accounts
The Bitcoin blockchain offers complete privacy. It also offers the ease of storing your Bitcoins in multiple wallets. Some web-based wallets offer the facility of storing your Bitcoins in a software account simultaneously.
Few Important Points to remember
- You will require a Bitcoin account before engaging in any mining or trading activity.
- Web-based and software wallets are offered free by several Bitcoin exchanges.
- Securing a Bitcoin account is the sole responsibility of the owner. There are no organizations or banks that can be approached should you lose Bitcoins due to any reason.
- You need not buy Bitcoin before and after opening an account or acquiring a wallet.
- Bitcoin wallets are unique: Every Bitcoin wallet or account is unique. It has an imitable identity that cannot be faked. It is important to transfer your Bitcoins to your own account or wallet instead of leaving them with a Bitcoin exchange. Remembering the keys or access codes and passwords is extremely important.