Bitcoin is the first digital currency (cryptocurrency) to be created, owned, and traded electronically. Bitcoin and other digital currencies run on a decentralized network and were created as an alternative to “fiat”, or national currencies. While the value of all digital currencies is highly volatile, Bitcoin is one of the most stable of all. Since 2019, you can earn Bitcoin in one of three ways. The most basic method is to receive it (as payment for a product or service, or exchanged from another fiat or digital currency) or purchased at a digital currency exchange rate. You can also try mining Bitcoin, although now this option is no longer profitable.
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Method 1 of 3: Accepting Bitcoin
Step 1. Set up a digital currency wallet that you control
Before you can accept Bitcoins this way, you'll need a digital wallet to store them. You can think of a Bitcoin wallet as similar to a physical wallet for storing cash, ATM and credit cards, although of course, you don't need a physical wallet to receive money digitally. You can choose a mobile wallet, software, or hardware. Go to https://bitcoin.org/en/getting-started to choose the best wallet for your needs.
- While you can use an online wallet, it's usually not the best option because it's vulnerable to hackers and you don't really control it.
- A mobile wallet is a free application that can be downloaded via smartphone app stores. On the other hand, a software wallet is a desktop application that is downloaded from the website of the associated digital wallet maker. This wallet is as secure as a computer or smartphone and the network it uses.
- Hardware wallets look more like thumb drives and can be purchased online or at computer stores and are quite expensive. Although the fees are higher than mobile or software wallets, they store Bitcoins much more securely because they are not connected to the internet. Use a hardware wallet if you plan on saving a lot of Bitcoin and want to keep it long term.
Tip:
Make sure you enable a strong firewall and keep your antivirus program up-to-date before downloading any software for Bitcoin wallets. Remember that the security of the wallet is very dependent on where the system is located.
Step 2. Copy your Bitcoin wallet address
After setting up a wallet account, you will be given a Bitcoin address. You can think of this address as the same as a bank account. If you want to receive Bitcoin, you need to provide the Bitcoin address to the Bitcoin sender.
You don't need to keep your Bitcoin address a secret. Anyone can send Bitcoins to you through this Bitcoin address, but they can't take anything from your wallet (or even see your balance). You need a private key to manage your Bitcoins
Step 3. Contact the person who wants to sell his/her Bitcoin
If you know someone who is interested in giving or selling you Bitcoin, simply provide your Bitcoin wallet address. If you don't know anyone but are interested in direct bartering, there are peer-to-peer (P2P) sites that can help you find sellers.
- For example, LocalBitcoins is a site that helps pair up Bitcoin buyers and sellers who live near each other and want to barter.
- You should never meet people in person to barter Bitcoin. This transaction can be done entirely via the internet.
Tip:
There are enthusiastic Bitcoin community groups that meet regularly to discuss the digital currency. Transactions usually take place during meetings, but it is almost certain that these people know each other closely.
Step 4. Buy Bitcoin via Bitcoin ATM
Bitcoin ATMs allow you to buy small amounts of Bitcoin without going through third-party exchanges or finding other individuals who have Bitcoins and want to sell them to you. However, the availability of these Bitcoin ATM machines is very limited in Indonesia.
Currently, there are only 3 Bitcoin ATMs in Indonesia: in Jakarta, in Kuta (Bali), and Ubud (Bali)
Step 5. Accept Bitcoin as payment for a product or service
If you are a small entrepreneur, you can sign up for a merchant service program to accept Bitcoin as payment. This program is quite popular with online businesses and many online malls provide Bitcoin payment options.
- Even if your business is a small business unit, you can also accept Bitcoin if you use a tablet or mobile phone so customers can pay with their phone.
- Because Bitcoin transactions cannot be reversed, if you accept payments via Bitcoin, you can avoid requests for money back due to customer complaints or disputes.
Method 2 of 3: Using a Digital Currency Exchange
Step 1. Compare various cryptocurrency exchanges to determine the best one for you
If you are experienced in using stock trading platforms, digital currency exchanges are not much different. There are many digital currency exchanges on the internet. When researching these exchanges, you will find that each has a different level of security, fees, and trading interface.
- Ideally, you should choose the most secure and lowest-cost exchange. It's also a good idea to look at the exchange server locations. Transactions will be faster on servers near you.
- Not all exchanges operate in all countries. If you live in a remote area, there may not be many exchanges available in your area.
Step 2. Set up an account on the selected exchange
Once you find the exchange you want to use, go to its page and look for a button or link to register an account. Initially, you will be asked to provide personal information, including your name, address and email address. After that, you will need to verify your identity.
The identity verification process varies between cryptocurrency exchanges. This process could involve scanning a photo of your ID or driver's license, taking a selfie while holding a certain code, or scanning a document from a government agency to prove your address
Tip:
Transactions via digital currency exchange no anonymous. Many exchanges must verify your identity before you are allowed to trade. If you want to buy Bitcoin anonymously, use P2P sites to connect with other individuals.
Step 3. Link a bank account, debit or credit card to buy Bitcoin
Once your account is ready, it's time to fill it with funds. Most exchanges allow you to connect to a bank account and transfer funds in fiat currency electronically. Some exchanges also allow you to use a debit or credit card, although these transactions are usually subject to a fund limit, such as the maximum number of Bitcoins you can buy in a day.
Like stock exchange platforms, digital currency exchanges cannot show how much money is in your bank account or card. before buying Bitcoin on an exchange, you need to transfer your fiat currency to an exchange account
Step 4. Enter the desired amount of Bitcoin
Once you have filled your account with funds, buying Bitcoin on an exchange is similar to ordering shares on a trading platform. You can enter a specific amount of Bitcoin that you want at any market price, or you can specify the number of Bitcoins that you want to buy a certain amount of fiat currency.
- Like any stock trading platform, you usually also have the option to set the maximum price you are willing to pay for Bitcoin. Given the highly volatile price of Bitcoin, this trick could be ideal.
- After you place an order, the exchange will withdraw the funds from your account and exchange them for Bitcoin. Since Bitcoin transfers are usually quite slow compared to other smaller digital currencies, it can sometimes take up to several hours before your Bitcoins appear in exchange accounts.
Step 5. Transfer Bitcoin from exchange account to wallet
Digital currency exchanges are very vulnerable to hackers. To keep Bitcoin safe, transfer it to a digital currency wallet that you control as soon as possible after it is confirmed on an exchange.
- To send Bitcoins to a wallet, click the link in your exchange account to withdraw Bitcoins. Then, enter the Bitcoin address into the resulting wallet. The exchange will send Bitcoin to the wallet. It takes several hours for Bitcoin to appear in your wallet.
- Some exchanges offer their own software wallets to make the Bitcoin withdrawal process faster.
Method 3 of 3: Mining Bitcoin
Step 1. Calculate Bitcoin mining profitability with online mining calculator
If you're thinking about mining Bitcoin with your own hardware, you need to understand how much investment you need to make and how long it will take to get your money back. An online mining calculator can help you determine the viability of this investment.
- Bitcoins are mined by a network of computers that solve difficult numerical problems to verify Bitcoin block transactions. A transaction block is made up of subsidized rewards and transaction fees. Since 2020, the block reward subsidy has been 12.5 bitcoins, but this number is decreasing every four years to an estimated value of 6.25 bitcoins around May 2020. To become a competitive miner, you need ASIC (Application-Specific Integrated) units. Circuit) connected to a computer or multiple GPUs (Graphics Processing Units) are best suited for mining alternative digital currencies that can be exchanged for Bitcoin.
- Go to https://www.cryptocompare.com/mining/calculator/ to find out how much you need to spend on electricity and hardware acquisition before starting to make a profit mining Bitcoin. Keep in mind, in reality individual miners need to spend up to tens of millions of rupiah before they can exceed the break-even point.
Tip:
The lower your electricity costs, the lower the risk of losing your money. Use renewable energy whenever possible. Keep in mind that as the price increases, mining Bitcoin will be more difficult as the competition gets tougher as well.
Step 2. Purchase Bitcoin mining hardware
If you are determined to mine Bitcoin despite the high costs, you will need an ASIC miner and a power supply to power it, as well as some GPUs. The price of an ASIC miner varies depending on power and efficiency, but expect the cost to be between 20 million and 30 million rupiah.
After purchasing the hardware, you need to be able to prepare it. If you don't know how to work with circuit boards and computer hardware, this may not be an ideal hobby for you
Step 3. Join a mining pool
Mining pools, such as BitMinter, CK Pool, or Slush Pool, allow you to combine mining resources with other miners to increase power and efficiency. Without a mining pool, you will be mining for years before you can earn Bitcoins.
When registering a mining pool, you will receive configuration settings to add to the mining device as a worker. The mining device will start working once you save these settings in your device
Step 4. Activate your mining device constantly to maximize profit
You can control your electricity costs by only activating your mining device for a few hours a day. However, this way you will not earn enough Bitcoins. Even in pools, you will only get Bitcoins that are mined yourself.
Since mining equipment generates a lot of heat, it's a good idea to keep it in a cold room or garage that is naturally cool
Tip:
If and when you mine Bitcoin, transfer it from your mining pool account to a Bitcoin wallet you control as soon as possible.
Step 5. Choose a cloud mining contract if you don't want to build your own device
Not everyone has the abundant capital to buy a Bitcoin mining device, or the tech savvy to keep it active. This is where cloud mining comes in handy. Cloud mining companies have many server "fields" for Bitcoin mining tools and offer contracts that allow you to lease the power of these fields for a certain amount of time.
- There are many cloud-mining related scams on the internet. Go to https://www.cryptocompare.com/mining/#/ to research the company's reputation before buying a contract.
- Smaller contracts (usually around Rp. 1,500,000) will never be able to mine enough Bitcoin to make a profit. Even larger contracts (with prices in the hundreds of thousands of dollars) can take several years to pay off.
