Where do I keep my bitcoins?

Bitcoin, Cryptocurrency

bitcoin logo

Having the power of being your own bank has become much easier with the use of modern crypto-technology and the creation of the block-chain. In time history will show the release of Bitcoin technology is the financial industries Napster moment. The financial industry is experiencing why technology in the hands of the users is disruptive.

The need for a person to have a bank account to deposit their currency in a trusted “safe” bank controlled by someone else has been eliminated. In a world where the trust of others has been a difficult state of being when dealing with money, now has a tool which eliminates the need to trust anyone (Bitcoin). Storing your money in the block chain requires the user to understand a new way to manage their money.

Since you now have the power of being your own Swiss Bank account at your fingertips, the first thing a user must understand is how to store bitcoins.

Follow these steps to becoming a full member of a new model of economic freedom.

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A few things to remember:

  • A Bitcoin Wallet is a place to store the digital keys needed to access your public bitcoin address and sign your transactions.
  • Think of bitcoin the currency as the “modern” equivalent to cash in a world which demands a better form of transaction technology. the current paper based cash or archaic credit card technology doesn’t protect.
  • Types of bitcoin wallets available:
    • mobile wallets
    • desktop wallets
    • web based wallets
    • paper wallets
    • hardware wallets

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General Grammar: Systematic Knowledge

  • Answers the questions of the who, what, where, and when of this subject.
  • Discovering and ordering facts of reality comprise basic, systematic knowledge.

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This section will define the terms needed to understand the essential elements of the types of software used to store bitcoin.

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What are Bitcoin Wallets?

Bitcoin Wallets

  • Wallets are the software tools which will allow you to make transaction with others who use the Bitcoin network.
  • Wallets store the private keys needed to access a bitcoin address to spend the your funds.

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What type of Bitcoin Wallets are used?

Types of Wallets

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What are Desktop Wallets?
  • These wallets are installed on your computer and you are 100% responsible for taking care of your bitcoins.

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What are Mobile Wallets
  • Mobile wallets give you access to your bitcoins in your pocket.
  • A mobile wallet is software which runs either on a mobile browser or an App on your smartphone.
  • Mobile wallets store the private keys for your bitcoin address.
  • Mobile wallets are not the full bitcoin client (smartphones don’t have enough memory for the block-chain)
  • Mobile wallets are designed for simplified payment verification (SPV)
    • ***Mobile wallets download a very small subset of the blockchain and then relies on other trusted nodes in the bitcoin network.***

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What are Web Wallets
  • Web based wallets will host your bitcoins.
  • Web based wallets store private keys online.
  • Web based wallets store your bitcoins on someone else’s computer.

The advantage of using a web wallet is access to your bitcoins from anywhere regardless of the device used.

The downside of a web wallet is you are not in control of your private keys. (hmmm, sounds good for daily use by not long term use).

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*Paper Wallets
  • A method for storing bitcoins offline as a physical document.
  • Paper wallets can be secured like cash or anything else of “real-world” value.
  • Paper wallets generate a bitcoin address with a public and private key QR code.

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*Hardware Wallets

A Cold Storage device

  • A dedicated device that electronically stores your public and private keys for bitcoin offline.
  • Currently Hardware wallets are limited (June 2014).
  • Hardware wallets can be used securely and interactively.

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Are Wallets Safe?

  • This depends on your new found banking skills.
  • The private keys stored in your wallet are the only way to access the transaction data stored in a bitcoin address.
  • The key to bitcoin safety is to become aware of your transactions and once you scan and complete the transaction there is no getting the bitcoins back.

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Are Bitcoin wallets anonymous?

  • Well yes and no. Bitcoins are considered pseudonymous.
  • No one knows what your private keys are.
  • But the entire transaction history of every bitcoin created is completely transparent.

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How to secure your wallet?

  • Encrypt your wallet with a strong password
  • Back it up
  • Backing up makes copies of your private keys
  • Back up the entire wallet
  • Create a scheme
  • Take your wallet offline
  • Cold storage

Paper Wallets: wallets that create a QR code and store your bitcoins offline.

  • The idea is to store the majority of your bitcoins in cold storage and sweep some to your hot wallets when you are wanting to make transactions.
    • This technique will protect you the most from losing your bitcoins.
    • Most wallets feature a cold storage option.
    • Creating a paper wallet and going physical with the offline security of your bitcoins.

Why you should use bitcoin

Bitcoin, Cryptocurrency

bitcoin logo

At this moment the world is going through a paradigm shift so great that we can’t truly comprehend how trans-formative it is. I have never had the opportunity of being aware of being on the ground floor of a historical moment. As grandiose as these two sentences sound, I believe every word I am saying.

  1. A new form of trust has been created.
  2. A new form of performing transactions for the goods and services has been created.
  3. A new form of economic freedom has been created for everyone on this planet to voluntarily participate in Freely.

The new technological tool to economic freedom is Bitcoins blockchain technology and below are a few reasons as to Why you should be using Bitcoin.

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Making transactions in Warp drive.

  • The speed of the bitcoin payment network is extremely fast for making transactions.
  • When you send money using the bitcoin network the transaction is instantly there.
  • The time period for a bitcoin transaction to occur is between instant and 10 minutes.
  • The current banking payment processing networks take extremely long to process.
  • If you deposit a check from another bank into your account; the bank often holds the check because it can’t trust if the funds are available.
  • Another example is making an international wire transfer; the company making the transfer charges the user an extremely high fee to send their money using their private payment network.

The price when you use Bitcoin is cheap. C’mon now, who doesn’t like this four letter word!

  • Imagine every time you use your credit/debit card to pay for your Iced Latte the merchant has to pay a transaction fee.
  • The merchant isn’t going to simply pay this transaction fee freely, the merchant will forward the fee’s they have to pay by charging you, the valued consumer of their goods and services, more money.
  • With Bitcoin the transaction fees are voluntary on the part of the person making the bitcoin transaction.
  • As the person attempting to make a transaction can include any fee or none at all in the transaction.
    • Hmmmm, total voluntary freedom to use a payment network and not have to pay a fee for using this tool sounds like freedom to me.
  • Unlike when you use the current centralized banking payment networks every time you swipe your card a bank charges a fee.
  • Every time a fee is charged diminishes the amount of money you can actually use towards your purchases.

Central governments can’t take your bitcoins away!

Does this need any further explanation?

If you cherish the lack of control over your financial freedom then the traditional banking system is for you.

If you feel the need of having access to your wealth controlled by a third party institution then the traditional banking system is made especially for you.

Here are a few examples of how governments use your money for the greater good:

Bitcoin is not controlled by a central authority.

This is a huge benefit for people who are losing trust in the “traditional” banking systems.

With Bitcoin there are no chargebacks.

    Using bitcoin technology will free you from someone calling their credit card company or bank to reverse a payment on a purchase. This type of technology makes it very difficult to commit fraud.

Bitcoin technology keeps your personal information is safe from identity thieves.

    People can’t steal your information from merchants.

    A few examples of old technology being abused in a modern connected world:

    With bitcoin no personal information is needed.

    With bitcoin a public key (cryptographic long random number generated) and a private key (an even longer random number generated) are the only things needed for proof a transaction occurred from you.

    Warning: never publish your private keys, these are the keys to unlock access to your public keys)

Bitcoin isn’t inflationary

    When a bank wants to increase money circulation they just print more fiat currency.

    When a government adds more money to the market, the overall value of the money is decreased.

    • ex: a gallon of milk cost $3.25 one year and if you wait a while the same gallon of milk could cost you $6.50.

    Inflation of your currency means a decrease in your personal wealth and a decrease in purchasing power.

    • Bitcoin can’t be controlled or manipulated by any central authority.
    • Bitcoin can’t be created by any government to inject more money in the economy.
    • Bitcoin is created by computers working to solve a complex mathematical problem.
    • Bitcoin’s are created every 10 minutes by miners. there will only be 21 million bitcoins ever generated by 2140.

When you use Bitcoin, you can be as private as you want to be.

    This one is another no brainer.

    Do you want the world to know about your personal purchases made?

    Do you want people to know about the organizations you support?

    Currently every transaction made can tell the world about every interesting thing you’ve done.

    • Bitcoin payment network is relatively private.
    • Bitcoin is completely transparent because of the blockchain public ledger.
    • Everyone can see how much a bitcoin address is worth.
    • Everyone knows where the bitcoin transaction came from and where the transaction was sent.
    • But, unlike current payment networks (insert all the money, credit, debit cards), with bitcoin no one knows who holds a particular bitcoin address.
      example of a public key address and a private key address: “3J98t1WpEZ73CNmQviecrnyiWrnqRhWNLy”

      ****Make a note: anyone who uses a bitcoin address over and over again or combines counts from multiple addresses into one single address, risk making it easier to Identify them online.****

The need to trust anyone is no longer necessary.

    The concept of a trust-less currency is a tough one to digest.

    1. Current banking system: you “have” to trust people to handle your money properly along the way.
    2. Currently you have to trust the bank
    3. Currently you have to trust a third party payment processor.
    4. And on top of all these outside parties, you have to trust the merchant you are using.

    All these groups demand sensitive information from you.

    1. Because bitcoin is a decentralized payment network, you don’t need to trust anyone.
    2. With bitcoin you send your transaction, it’s then digitally confirmed and secured by some unknown miner anywhere in the world who verifies your transaction.
    3. Now that we have a trust-less payment network, the merchant knows they will receive their money, regardless of who you are.
    4. Now the need for a merchant or anyone to know each other isn’t even necessary, unless you choose to do so (insert fear propaganda from government).

You are your Bank, and know you own it.

    Every electronic cash system is owned by someone else.

    Bitcoin is owned by the users (we the people of the planet earth) of the technology (insert hearts for open source software).

    This means you now have the power of being your own bank.

    Currently a bank or a payment system can decide to freeze your account for any particular reason without consulting you.

    This isn’t good for you since we need money to function freely in the world (another reason why so many organizations are disturbed about the bitcoin technology).

    Enter Bitcoin technology: you are the only person who owns the public and private keys to a bitcoin address.

    1. No one can ever take your economic freedom away.
    2. No one can ever seize your assets.
    3. But like all great powers comes great responsibilities.
      If you ever lose these keys to your wealth, then you loose all your wealth.

One more thing: You can create your own.

And now shit just got really weird.

  • All governments discourage you to produce your own version of the currency they print (aka counterfeiting if you are a single person) or money creation process if you are a part of the cool kids in the Federal Banking Systems.
  • Since bitcoin is a decentralized software that requires the users (we the people- lame I know!) to create your own bitcoin through mining if you happen to have enough computing power.
  • Mining is “straightforward.” All it means is leaving your computer and the software running.

And now you have joined the money creation racket of the world.

The Newbies Guide Through the Galaxy of Bitcoin

Bitcoin, Cryptocurrency

7 Attributes of Bitcoin (blockchain technology):

  1. Bitcoin is decentralized.
    • the bitcoin network isn’t controlled by one central authority.
    • all machines that mine bitcoins and process transactions are part of the network of machines working together to form the peer to peer network of bitcoin.
    • this attribute is important because, technically, no one central authority has the ability to create monetary policy and cause the currency to devalue. Like the collapse of the Argentinian Peso in 2014.
    • also no central bank can take take peoples bitcoins away from them, like the Central European Bank did in Cyprus in 2013.
    • if part of the bitcoin network were to ever go offline for some “strange” reason, the flow of money wouldn’t be stopped.
  2. Bitcoin is easy for anyone to set up.
    • conventional banks make it very difficult to open a bank account.
    • current financial systems make setting up a merchant account for a business even a bigger hassle.
    • you can set up a bitcoin address in no time. No one will hassle you for any information to set one up a bitcoin address. No one will make you pay any ridiculous fees to use your money.
  3. Bitcoin is pseudonymous (almost anonymous).
    • you can have multiple bitcoin addresses.
    • No bitcoin address is linked to a name and addresses, or any other form of personal information.
  4. Bitcoin is transparent.
    • every detail of all transactions ever made on the bitcoin network is stored in a public ledger (aka a blockchain).
    • the blockchain displays all bitcoin public addresses.
    • anyone can look to see how many bitcoins are stored on any address.
    • but no one knows who the address belongs too.
  5. Bitcoin Transaction fees are almost insignificant.
    • a conventional bank charges you a fee every time you utilize their service.
    • the miners (the backbone for the bitcoin network) of the bitcoin payment network might charge you a transaction fee from 40 cents to free for utilizing the service.
  6. The Bitcoin Network is really fast.
    • money can be sent anywhere and it will arrive in minutes (as soon as the bitcoin network processes it).
  7. Bitcoin is non-repudiable (crypto talk here)
    • once you send bitcoins, there is no one to call to refund (charge back) your money.
    • unless the person receiving them sends them back to you.
    • Remember when the bitcoin is sent, it is gone for good.

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What is Bitcoin?

  • a form of digital currency.
  • a payment network.
  • bitcoins are not printed by a central bank, unlike the dollar or euro, or any other national currency.
  • bitcoins are produced by “we the people,” running computer software around the world, trying to solve a mathematical problem.

What makes bitcoin different from fiat currency?

  • bitcoin is decentralized.
  • no single institution controls the bitcoin network.
  • the people who use the bitcoin network become their own bank.
  • unlike the normal currency which one central bank controls their money.

Who created bitcoin?

  • a person or a group of people using the name Satoshi Nakamoto.
  • Satoshi released the first bitcoin software in 2009 open source.

Who prints Bitcoins?

  • nobody does.
  • bitcoin is created digitally by the community of people that is open for anyone to join freely.
  • bitcoins are mined with the computing power in a distributed network.
  • the bitcoin network also processes the transactions made with the virtual currency.
  • this makes the bitcoin network a payment network as well.

Can you hack bitcoin and create an unlimited amount?

  • nope.
  • the bitcoin protocol (rules that make bitcoin work) will only create 21 million bitcoins by the miners, ever.
  • but bitcoins can be divided into smaller and smaller units.

What is Bitcoin backed by?

  • conventional currency once was backed by gold. Currently currency is backed by a promise by the government to support it.
  • bitcoin isn’t backed by a government or gold. bitcoin is based on mathematics.
  • miners around the world are using their computers to run the software for bitcoin that follows a formula to produce bitcoins.
  • the mathematical formula is freely available for people to study, learn, copy and redistribute (aka Open Source Software).
  • being open source software means anyone can look at the code and make sure it is doing what it is supposed to do.

Linux Filesystem Hierarchy Standard

Command Line, Linux

512px-Tux.svg

File System:
a system for storing data in separate groups.
What is a directory?

A directory is simply a group of files.

Directories are used to organize your data files and programs more efficiently.

    2 types of directories:

  1. Root directory
  2. Sub directory
    directory under root which can be created, can be renamed by user.

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Linux Filesystem Hierarchy

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  1. / (root)

    every single file and directory starts from the root directory
  2. /bin (user binaries)
    contains *binary executable’s
    binary file
    a computer file that is not text file. usually encoded in binary file formats (represented in 0’s and 1’s).
  3. /sbin (system binaries)
    commands in this directory are typically executable’s used for system maintenance and/or administrative tasks.
  4. /etc (configuration files)
    visualize this directory as the nerve center of your computer system.
    contains configuration files required by all programs.
    contains startup and shutdown shell scripts used to start or stop individual programs.
  5. /dev (device files)
    the location of special or device files.
    ****highlights one important aspect of the Linux file system – everything is a file or a directory.****
  6. /proc (process info)
    This directory is regarded as a control and information center for the kernel.
    contains information about system process.
    its a virtual file system which provides an interface to communicate with the kernel and presents information about processes and other system information.
  7. /var (variable files)
    contains variable data
    i.e. files and directories the system must be able to write to during operation, whereas **/usr** should only contain static data.
    contents of the files that are expected to grow can be found here.

  8. /tmp (temporary files)
    temporary files created by system and users.
    files under this directory are deleted when the system is rebooted.
    Do not remove files from this directory unless you know exactly what you are doing.
    Many of these files are important for currently running programs and deleting them may result in a system crash.
  9. /usr (user programs)
    contains all the user binaries, their documentation, libraries, header files, source-code, etc…
  10. /home (home directory)
    home directories for all users to store their personal files.
    /home can get quite large and can be used for storing downloads, compiling, installing and running programs, your mail, your collection of image or sound files etc.

  11. /boot (boot loader files)
    contains everything required for the boot process except for configuration files not needed at boot time.
    stores data that is used before the kernel begins executing user-mode programs.
  12. /lib (system libraries)
    contains kernel modules and those shared library images *(the C programming code library) needed to boot the system and run the commands in the root file system.
  13. /opt (optional add-on applications)
    contains add on apps from individual vendors.
    all third party applications should be installed in this directory.
  14. /mnt (mount directory)
    temporary mounts directory for removable devices.
    Before one can use a file system, it has to be mounted.
  15. /media (removable devices)
    temporary mounts directory for removable media devices.
  16. /srv (services device)
    contains site-specific data which is served by this system.

What is a Unix Like Operating System?

Command Line, Linux
Operating System

Operating System

I asked myself a question one day: What is a Unix-Like Operating system? I felt completely overwhelmed when I tried to answer this question. I ended up searching the depths of the Collective Brain of the Internet to discover a satisfying answer.

What I discovered was interesting. An Operating System is a new form of life created to assist our lives with the mundane. The computer software running behind the scenes is needed to manage the physiology of the computer.

The source code of the Operating System is the DNA of the computer. And the set of command instructions that performs a specific process is how the Operating System functions are carried out.

In this tutorial I will use the trivium method of classical education to answer: What is a Unix Like Operating System?

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The Trivium method has 3 elements:

  1. General Grammar: Systematic Knowledge
    • answers the questions of the who, what, where, and when of this subject.
    • discovering and ordering facts of reality comprise basic, systematic knowledge.
  2. Formal Logic: Systematic Understanding
    • answers the why of this subject.
    • developing the faculty of reason in establishing valid (non-contradictory) relationships among facts, Systematic Understanding.
  3. Classical Rhetoric: Systematically usable Knowledge and Understanding
    • provides the how of a subject.
    • applying knowledge and understanding expressively comprises wisdom, or, in other words, it is a systematically usable knowledge and understanding.

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Grammar

This Section will clearly define the Terms of the key elements for the definition of Operating System.

Each term that is defined will have a “*” next to terms within the definition. These definiens will clearly be defined for further clarity until a root of understanding is established.

Operating System
*software that manages *computer-hardware resources and provides common *services for *computer-programs.

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Software (aka computer programs)
clearly defined instructions that upon execution instructs hardware to perform the tasks it is designed for.

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Computer-hardware
the physical parts of the computer (everything that can be touched).
components:
  • monitor
  • mouse (track pad)
  • keyboard
  • computer data storage (RAM)
  • Hard drive
  • System Units:
    1. graphics cards
    2. sound cards
    3. memory
    4. mobo aka Motherboard
    5. chips (CPU)

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*Services
Daemon (not to be confused with the daemon that is an evil supernatural being or a person who is part mortal and part god)
(in computing) program that runs as a *background-process, rather than being under the direct control of an interactive user.

*background-process
a *computer *process that “runs behind the scenes” without user intervention.
*process (definition proper; process- a particular course of action intended to achieve a result)
the actual execution of the instructions of a *computer program (a passive collection of instructions).

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*Computer Program
a sequence of *instructions, written to perform a specified task with a computer.
a computer requires programs to function. typically *executing the programs instructions in a CPU.
a program has an *executable form that the computer can directly execute.
the same program in its human readable *source code form; from which executable programs are derived (compiled), enables a programmer to study and develop *algorithms. (you learn how the program works).

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Computer Program Knowledge Tree
*Instruction Set
defines the codes that a CPU reads and acts upon.
its the machine language (or assembly language).
*Execution (proper definition; execute- carry out or perform a process)
process by which a computer performs the instructions of a computer program.
programs may execute in a *batch-process without human interaction.
programs may execute by a user typing *commands in an *interactive *session of an *interpreter.
*batch-process (proper definition; batch- a collection of things. process- a course of action intended to achieve a result)
execution of a series of programs (jobs) on a computer without manual intervention.
all input parameters are predefined through scripts, command line arguments, control files, or job control language.
*command (proper definition; an instruction to do something)
a directive to a computing program acting as an interpreter in order to perform a specific task.
a command is a directive to some kind of command line interface, such as a shell.
*interactive session (proper definition; interactive- capable of acting on or influencing each other. session- a meeting for execution of a group’s functions)
a semi-permanent interactive information interchange (dialogue) a conversation or a meeting between 2 or more communicating devices, or between computer and user.
*interpreter
a program that translates and executes source language statements one line at a time.

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*Source Code (definition proper; source- the place where something begins, where it springs into being. code- the symbolic arrangement of data or instruction in a computer program or the set of such instructions)
any collection of computer instructions (possibly with comments) written using some *human-readable computer language, usually as text.
source code is transformed by a *compiler into low-level machine code understood by the computer.
source code can mean any fully executable description of a software system.
source code which constitutes a program is held in one or more text files stored on a computers hard disk.
files are arranged in a *directory-tree, aka source tree.

*compiler (definition proper; a program that decodes instruction written in a higher order language and produces assembly language program)
a computer program or set of programs that transforms source code written in a programming language (source code) into another language (the target language, often having a binary form known as object code).
programs that translate source code from a high level language to a lower level language (assembly language).
*directory tree (definition proper; directory- a listing of files stored in memory)
*FHS (file-system hierarchy standard)
defines the directory structure and directory contents in Unix and Unix-like operating systems.