Tag: Bitcoin

The Price of Procrastination, Payoff of Patience

I have a confession to make, and I’ve felt guilty about it for over 2 years. Only recent developments have alleviated this guilt. Allow me to explain.

In early 2018, a friend started asking me about Bitcoin. I told him everything I knew and he was very receptive to the concept of decentralized finance. He asked if I would help him set up an account to buy Bitcoin and of course I agreed. We met a few days later and I guided him through the process of setting up a Kraken account. The next step was for him to allocate funds to his account. This involves a trip to the bank to wire funds, then a holding period to ensure the funds transferred successfully. He decided he wanted to start with $2,000 which was a lot for him at the time.

A few days later he told me his funds transferred successfully and he’s ready to make the purchase but his schedule is a little crazy so he’s not sure when I could come over.

Anyone who recalls the history of crypto prices in early 2018 knows it was very volatile – crashing down from the highs of Christmas 2017 at $20,000, prices fluctuated thousands of dollars a day.

A week lapsed since my friend’s commitment to purchase, and in that week, Bitcoin’s price plummeted to $5,000. I called him and told him this is the time to buy – his money would go far. He was excited and said he’d call me back with a good time for me to come over and help him make the purchase. Days passed and he didn’t call. I called him again and told him the prices can jump quickly and he may miss a good opportunity to get the best price for his purchase. He thanked me for keeping him in the loop but still wasn’t ready for me to come over.

Over 10 days later, he finally invited me over to help him buy his Bitcoin. Unfortunately the price doubled to $10,000. I struggled with the ethics of letting him buy at (what I considered at the time) a high price versus waiting for the price to fall again and then attempting to coordinate a time with him that coincided with a price fall. I’m embarrassed to admit I took the easy way out and let him spend his $2,000 on Bitcoin at $10,000. He owned 1/5 of a Bitcoin and was elated, but it haunted me knowing that he could have owned almost 1/2 of a Bitcoin if he would have not waited, or if I had the fortitude to tell him to wait for another price correction.

Months later the price crashed to $3,000 and held at that price for a long time. He could have had 2/3 of a Bitcoin if I talked him out of buying when he was ready but the price was $10,000.

Of course I didn’t have a crystal ball. I had no way of knowing the price would crash to $3,000 – it could have bounced back to $20,000 or higher. I felt responsible for not guiding him the way I would have guided myself, but he being oblivious to the price differential was a weak comfort I clung to while prices remained well under $10,000 for over two years.

During the fall of 2020, Bitcoin prices suddenly started climbing back to $10,000, then over $10,000, then toward $20,000 and I finally felt relief that my friend’s investment finally paid off. His $2,000 investment more than doubled. Presently the price is close to $40,000 yielding him a quadruple payoff on his investment.

The moral of the story is this: When someone you trust tells you to make your purchase NOW, it’s a good idea to stop what you’re doing and follow their advice. But the fact that this friend was otherwise disengaged from trading crypto, protected him from the urge to sell at a loss and miss the opportunity to benefit from a long term HODL.

Bitcoin and The Black List

During the COVID-19 Shelter In Place directive, I took the advice of a friend and started (binge) watching a show called The Black List. In Episode 5 of Season 3, Bitcoin was used as payment on the Dark Web. This would have been edgy in 2014 when the episode was shot, and even in 2015 when it was broadcast. What caught my attention was the USD equivalent for the Bitcoin. The offer was “2,800BTC or $700,000 USD”!

I double-checked and indeed the scriptwriters had their facts correct. In 2014 and 2015, a Bitcoin was a few hundred dollars. This was when Mt.Gox was hacked and shut down, diminishing confidence in Bitcoin.

Today the price of a Bitcoin bounces between USD $6000 – $10,000. Although this price is less than half of its peak in December 2017 where it hit $20,000 USD. Anyone who bought Bitcoin between December 2017 and January 2018 but didn’t sell immediately would have lost money – some lost a lot of money. But thinking back to that The Black List episode, if that Dark Web payment of $700,000 USD in 2015 was accepted in the form of Bitcoin, its value would be $18,000,000 USD today.

Indeed the episode is fictitious, but the math is real. It provides comforting context that Bitcoin does hold its value given a sufficient timeline. Transacting with terrorists is not in my plans, but I do intend to hang onto my digital currency to see where it is in 5 years, maybe while binge watching another show, hopefully not during another pandemic lock down.

Eating Crypto Crow

I’m reminiscing on a post I wrote in the fall of 2017 savoring the gains I made buying my Bitcoin at $3,900. In hindsight it seems arrogant, so I feel compelled to disclose that in the winter of 2018 I bought another Bitcoin but at closer to $12,000.

If you follow crypto prices, you’ll sympathize how I saw that $12,000 as a huge “dip” from the December 2017 high of almost $20,000. You’ll also recognize that this wasn’t a dip at all, but a downward slide that hasn’t yet recovered. In spring 2018, prices fell to a little under $6,000 – HALF of what I paid. Currently, Bitcoin is around $9,000, which puts my second purchase at a significant loss.

Do I regret buying that second Bitcoin? I do wish I waited to see how far it would drop before I committed. I still would have spent $12,000 but I would have gotten 2 instead of just 1. In my defense, during the pre-Christmas valuation climb, prices increased so rapidly I was conditioned to believe if you wait, you lose out. I have since un-conditioned myself from that belief.

Some credible financial analysts predict Bitcoin’s value will drop to zero (“MIT“, and “Former PayPal CEO Bill Harris“). Other equally credible financial analysts predict Bitcoin is on the precipice of skyrocketing – doubling or tripling the value of my second bitcoin (“Hedge Fund Manager John Pfeffer” and “Comcast VC Bullish on BTC”).

Obviously I hope the optimists are right. Only time will tell if the crow I’m eating today the last meal before my profit dreams die, or but a garnish on a delicious platter of future profits. Whichever direction it goes, I’ll post about it.

 

Setting up a Ledger Nano S Hardware Wallet

I am grateful for the people who create cryptocurrency hardware wallets, but so frustrated at their pitifully insufficient instructions on how to set up and use them if you’re not a tech savant. I suffered through the trials and errors of setting up my Ledger Nano S hardware wallet (you can marvel at my endurance through this tribulation here).

Here is my succinct guide of how to initiate and set up the Nano S wallet if you’re not a programmer or in FinTech but just a regular schmo trying to protect your crypto assets.

When you open the Ledger Nano S box and are ready to set it up, do this first:

  • Think up a PIN that is between 4 and 8 digits (numbers only).
  • Get the Backup card with 24 numbered lines on it (the Nano S calls this the “Recovery Phrase”)
  • Get a GOOD WORKING PEN (fine tip because some words are long and the space is small)
  • Have a good Internet connection
  • Have a Laptop/Desktop computer (probably works on a tablet too)
  • Have a Chrome browser on your computer
  • Have about 2 hours (will be much less than this if all goes well but %$#! happens)

Plug the USB cord into the Nano S device and the other end into the computer. The device’s tiny LCD screen gives a lesson on how to navigate its interface with its two buttons: Push the Left button to scroll left, push the Right button to scroll right, push BOTH buttons to select something.

After the tutorial you’ll be prompted to enter a PIN. Use the tiny LCD screen and two buttons to enter your PIN. The first digit starts at 0, use the right button to go up by 1. When the number you want as your first digit appears on the little LCD screen, push BOTH buttons, and it moves onto the second digit. If you went too far, keep pushing one button until you see the number you want. After entering the 4th digit, the tiny LCD screen will show a checkmark. If you only have a 4-digit PIN, push both buttons down to select the checkmark – this tells the device you’re finished entering your PIN. If you have more digits in your Pin, use the Right button to scroll past the checkmark and you’ll see a zero, then a 1, then a 2… keep scrolling until you see the digit you want, then push both buttons. The tiny LCD again will show a checkmark. If you only wanted a 5-digit PIN, push both buttons to select the checkmark. Otherwise, use the Right button to scroll through the numbers until you see the number you want. Keep doing this until you have the PIN you want (maximum 8 numbers).If you get to the 8th digit, the Nano S device will not prompt you with more number options. When you enter all of the numbers the LCD prompts you to enter your PIN again to make sure what you input is what you meant to input.

Next, the tiny LCD will prompt you to “write down the recovery phrase” which means get that card with 24 numbered lines on it and a good working fine tip pen. Use the Right button to see the first word. When you wrote it down on the card in space #1, use the Right button to see the next word. When you wrote it on the card in space #2, use the Right button to see the next word. Repeat until all 24 words are written down. At the end of the 24th word, there is no prompt. You should use the Left button to double-check your words (in reverse order). Once you get past word #1, it asks if you want to verify

After scrolling through the words, the interface did not give me a prompt to continue. I pushed the Right button, but nothing happened. So I pushed the Left button, and it scrolled through the words in reverse order. When I got to the first word again, I pushed the Left button one more time, and it quizzed me on the words I just saw: What was word #13? Then it prompted me to scroll through a bunch of random words until I saw the word I wrote in space 13. When I saw the word, I pushed both buttons. Then it asked me to identify word #22. I scrolled through the options until I saw the word I wrote in space #22. I pushed both buttons to select it. Then it told me the device has been configured and is ready to use.

But it’s not really ready yet.

You need to get on a computer with a Chrome browser and go to https://www.ledgerwallet.com/apps/manager

At the top menu bar, click on the Apps link. First you must download the LEDGER MANAGER App. It’s on the right under “Ledger Manager Apps”. This is a Chrome Extension that’s about 2 MB. With a mediocre Internet connection it will install in about 5 minutes.

Next, you must download the specific wallets you need to use. Download the Bitcoin Wallet if you plan to store on your Nano S any Bitcoin, Bitcoin Cash, or coins derived from a Bitcoin Blockchain (I have no idea how you know what’s derived from a Bitcoin Blockchain so I suggest you assume you will need it and download it). This is an extension to your Chrome browser so it’s not very big and doesn’t take long to install.

Download the Ethereum Wallet if you plan to store on your Nano S any Ethereum or coins derived from an Ethereum Blockchain (again, I have no idea how you know what’s derived from an Ethereum Blockchain so I suggest you assume you will need it and download it). It is also an extension to your Chrome browser so it’s not very big and doesn’t take long to install.

Download the Ripple Wallet if you plan to store Ripple on your Nano S. This is the only hardware wallet I found that accepts Ripple, so if you have or plan to have Ripple, download this wallet. THIS IS NOT A CHROME EXTENSION – IT IS A 48 MB FILE that saves to your computer’s hard drive. You need a GOOD internet connection to download this. After you download it, you need to run it and install it onto your computer.

If your Chrome browser is still open, see if there’s a tab open at this URL: chrome://apps/ if not, launch your Chrome browser and go to chrome://apps/ this is where you should see your LEDGER WALLET BITCOIN, LEDGER WALLET ETHEREUM, and LEDGER MANAGER apps.  You won’t see the Ripple Wallet App because it’s not a Chrome extension, it’s a program on your hard drive.

If you’re going to use the Ripple Wallet, you need to install it onto your Nano S device, and you do this with the LEDGER MANAGER app (NOT the Ripple Wallet App!). So make sure your Nano S in UNPLUGGED from your computer, and launch the LEDGER MANAGER in your Chrome browser.

The LEDGER MANAGER will prompt you to plug in your Nano S device and enter the PIN. When the Nano S device wakes up, the screen in the LEDGER MANAGER window shows all of the Wallet Apps it offers. Scroll down until you see RIPPLE, then click on the down arrow to download it into your Nano S. The tiny screen on the Nano S will ask for you for permission to talk to the LEDGER MANAGER app. Click the button on the Nano S with the checkmark under it. In less than a minute, the Ripple wallet appears on the Nano S after the Fido U2F wallet (whatever that is – I’m going to see if I can remove it since I don’t recognize it and doubt I’ll use it).

If you recognize any other wallets you want to download to your Nano S, the process is the same. Scroll through the LEDGER MANAGER window on your computer and when you see a wallet you want, click on the down arrow to its right and it will show up on your Nano S device.

The good folks at Ledger could do a much better job communicating how to set up and use the Nano S. It seems like they exist in their tech bubble, assuming everyone would intuitively understand how these things should work. I found the process extremely frustrating, and would recommend the Trezor wallet because setting it up and using it was so much easier. Their instructions were more complete and the interface is more user friendly. But I persevered with the Ledger Nano S because it seems to support more alt coins and obscure baby coins. The major coins are getting priced out of my reach, so I’m getting more interested in finding and buying the new coins, hoping some (or just one!) will turn into the next big thing. I already wrote about my BABY COIN FEVER which you can read here, and I plan to write more about them since they really seem like the future of crypto currency.

Struggling With the Ledger Nano S Hardware Wallet

Now that I’ve broadened my crypto portfolio, I need to get serious about storing them safely off the Internet. Over a month ago I bought a Ledger Nano S hardware wallet but I didn’t get around to setting it up until now.

The device seems simple enough to figure out. I plugged one end of its USB cord into the device and the other end into my computer. Its LCD screen illuminated, giving directions on how to use its interface of two button and LCD screen: Push the Left button to scroll left, push the Right button to scroll right, push BOTH buttons to select something. Then it prompted me to enter a PIN. I wish it gave me the option to set up the PIN later, but it didn’t so I had to come up with something that would be too hard to guess, but not too hard to remember. I have no idea if there’s a way to re-set the PIN so I hope what I devised is adequate. It then prompted me to enter the PIN again, and I was relieved I remembered it properly since I made it up spontaneously.

It then instructed me to “write down the recovery phrase”. To me, a “phrase” is a SHORT SENTENCE. So I grabbed a pen and tiny post-it note.  What commenced was neither short nor a phrase. It gave me 24 random words to write down in sequential order. I realized it was giving me words to write in the “Recovery Sheet” that came with the Nano S device. Why didn’t it say “write down these 24 recovery words”?! So I stopped writing on the tiny note pad and found the recovery card with 24 numbered blank lines and recorded the words in their proper place.

After scrolling through the words, the interface did not give me a prompt to continue. I pushed the Right button, but nothing happened. So I pushed the Left button, and it scrolled through the words in reverse order. When I got to the first word again, I pushed the Left button one more time, and it quizzed me on the words I just saw: What was word #13? Then it prompted me to scroll through a bunch of random words until I saw the word I wrote in space 13. When I saw the word, I pushed both buttons. Then it asked me to identify word #22. I scrolled through the options until I saw the word I wrote in space #22. I pushed both buttons to select it. Then it told me the device has been configured and is ready to use.

BUT IT DOESN’T TELL ME HOW TO USE IT. It would be nice if either the tiny LCD screen gave me some direction. I double-checked the sparse instructions that came with the device and it did say to “get started at start.ledgerwallet.com” and follow the instructions. When I set up my Trezor hardware wallet, it clearly requested the Chrome browser. So I went to start.ledgerwallet.com on Chrome.

The Ledger Nano S was still plugged into my computer, so I was surprised when the Website couldn’t recognize the device I had and asked me to identify it from the other devices Ledger offers. It asks if I want to configure the device (nope, already did it without assistance), watch video tutorials (no thanks, I’m the weirdo who prefers reading than watching a video), or install a Bitcoin Wallet, an Ethereum Wallet, or a Ripple Wallet.

Since I specifically bought Trezor Nano S because it’s the only hardware wallet that stores Ripple, I click “Install Ripple Wallet”. This page promotes the wallet’s benefits of being simple, free, fast, secure, and open source “so anyone can access the full source code to authenticate code paths and contribute to the development”. This statement makes me laugh. Do these techies REALLY believe that ANYONE “can access and authenticate” source code? I – and I dare say MOST HUMANS ON EARTH – can neither access nor authenticate ANY kind of code – “source” or otherwise. But I guess “open source” sounds like a plus so I’m “happy” it’s a “feature” of my wallet.

There’s a button to “download the Ripple App”. I’m not sure where I’m downloading it to – I guess it’s to the Nano S device. I really don’t trust my computer because I know where on the Internet it’s been…

I click to download the Ripple App. It prompts me to save it somewhere but my Nano S wallet is not a destination option. I noticed the device looks like it went dormant, so I unplug it from my computer and plug it back in. It livens up and prompts me to enter the PIN and to my amazement I input it correctly.

The device’s little LCD screen is showing icon’s I hadn’t previously seen on it: A Bitcoin symbol, an Ethereum symbol, and two I don’t recognize. I use the buttons to scroll to them and it says “Fido U2F” and “settings”. I keep scrolling and it circles back to Bitcoin. Ripple is not there.

On my computer I click to download the Ripple App, hoping it will load onto my wallet and not only my (old and abused) laptop. It asks me where I want to save the app and again my Nano S wallet is not an option. So I guess I am storing this wallet onto my sketchy computer. I recall one of the benefits of the Ledger Nano S is that it is safe to use even on a computer with malware. I would not be surprised at all if I have malware, so as much as I don’t like it, start downloading the wallet to my hard drive.

While I’m waiting for the app to download, I explore the “Settings” option of my Nano S. Under “Settings” it offers “Display”, “Security”, “Device”, “Assistance”, and “Quit App”.  I chose “Quit App” and it brought me back to where I saw the Bitcoin and Ethereum symbols. So I guess “Settings” is an “App”? I went back into “Settings” and chose “Display” – this lets you adjust the LCD’s brightness, rotate the screen, or invert the colors. I didn’t want to do any, so I scrolled to “Back” and pressed both buttons to return to the previous menu. Now I selected “Security” which offers “Auto-lock”, “Change PIN” (oh good! I get a second chance if I think up a better one), “Shuffle PIN” (I have no idea what this means or how it would work), and “Passphrase” (which we now know means the sequence of 24 words that make the recovery key for this device). I don’t want to mess with any of these, so I scroll to “Back” and press both buttons. The next option is “Device” which offers “Firmware” (ugh, I don’t want to tinker with that) and “Reset all” (scary, no thanks). I choose “Back” and try the last option which is “Assistance”. I can’t image how much “assistance” a 3/8” by 1” screen can offer. I pushed both buttons and it displayed the following: “To get assistance, contact Ledger support.” Um, why even bother?? No phone number, no Web site. Seems like a waste of firmware (am I using that word right?). I pushed a button to scroll to the “Back” option but there wasn’t one! So I pushed both buttons and then it displayed help.ledgerwallet.com so I guess that’s the “more information” information. But I still don’t know how to leave this screen. I push both buttons again and now an email appears: help@ledgerwallet.com. I push both buttons again and it brings me back to the previous menu. It’s weird that that one screen doesn’t follow the same rhythm as the others. I scroll to “Quit App” and push both buttons.

After my tour of the LCD offerings, I noticed my Ripple App failed to download completely. It would have been nice if it warned me the file is 49MB. It would be a miracle if my dodgy internet could handle that. I’ll have to go to a WeWork to download it.

I went to WeWork and it downloaded in about 2 seconds. I downloaded the Ripple Wallet, the Bitcoin Wallet and the Ether Wallet. I think the Bitcoin Wallet and Ether Wallet are already installed on the Nano S device, but I didn’t want to have to go back to WeWork in case it wasn’t, so I downloaded them since I was in the presence of excellent Internet connectivity. They weren’t programs, they were “Chrome Extensions”. I’m not sure what the difference is, but they didn’t download a file to my desktop that I had to launch.

In my haste to get to WeWork, I forgot to bring my Nano S device with, so I have to go back home to finish setting it up.

Back home, I plugged in my Nano S device, then launched the Ripple Wallet program. I wasn’t happy to see the warning about the publisher not being verified and asking if I really want to open it. I clicked YES and ran the download. When it finished downloading, it asked me to click a FINISH button, then launched the Ledger Wallet Ripple program. It showed up as a separate program window in my application tray beside my Web browsers, but the screen was empty. My Nano S went to sleep, so I had to click the buttons and enter the PIN to wake it up.

On the Nano S’s tiny screen, it told me to “Use Wallet to View Accounts”. I wasn’t sure what that meant, so I clicked both buttons. That didn’t do anything. So I just clicked the Right button and scrolled through until I saw “Quit App”. I didn’t know I was in an App, so I selected it. Then I could scroll through the options of Bitcoin, Ethereum, Fido U2F, and Settings. There was no Ripple option which really bummed me out. I checked the Ripple program screen and it was still blank. When in doubt, I close programs and re-launch them. I also unplugged the Nano S and plugged it back in again. It prompted me to unlock the device and enter its PIN. I launched the Ripple program on my computer and its window said to launch the Ripple App on my device. It appears the Ripple App is not loaded on my device. I thought downloading the wallet to my desktop would also put it on my Nano S device since it was plugged in, but apparently not.

It appears I need to download the “Ledger Manager Program” to my computer which will enables the Ripple App to be loaded onto the Nano S device.

I thought this meant I had to go back to WeWork to download this program but I checked and it’s a Chrome Extension, which is only about 2 MB – a size my (terrible) home Internet can handle. I downloaded the extension and it showed up in my Chrome browser on the page chrome://apps/

I woke up my Nano S, then double-clicked on the Ledger Manager icon on chrome://apps/ and a new program window opened, listing all of the crypto currency wallets Ledger offers for the Nano S: Bitcoin, Bitcoin Cash, Dash, Dogecoin, Ethereum, Fido U2F, Komodo, LiteCoin, Stratus, Zcash, Hello, Ripple, PoSW, Ark, Ubiq, Expanse, PIVX, Stealthcoin, Vertcoin, Viacoin, Neo, Bitcoin Gold, Stellar, Digibite, Hcash, and Qtum.

I clicked on the down arrow beside Ripple. My Nano S screen asked me to confirm allowing the Ledger Manager to access it. I clicked the button with the checkmark. The little LCD said it’s processing for about 2 seconds and then went back to the regular menu showing the Bitcoin symbol. I used the button to scroll and saw it now has a Ripple icon. I guess it installed in about 2 seconds. So now I have a Ripple Wallet on my Nano S. I now have to launch its desktop wallet to transfer my Ripple off of Kraken and into the Nano S.

But first, I want to install the Stellar wallet since that’s a baby coin I want to buy (read about my Baby Coin Fever here). I went back to the Leger Manager window and clicked the down arrow beside Stellar. This time the Nano S didn’t prompt me to allow the Ledger Manager to access it. It didn’t even say it was downloading the wallet. I scrolled past the Ripple wallet, and the Stellar wallet was magically on the tiny LCD screen.

Now I’m ready to load Ripple and baby coins onto the safety of my Ledger Nano S hardware wallet. But first, here is a clean and clear set of instructions I made on how to set up the Ledger Nano S hardware wallet so you can do it without the frustration.

Baby Coin Fever

Now that the major coins are priced in the hundreds, thousands, and teen-thousands, there’s a lot of excitement about the “baby coins” – cryptocurrencies that are under $10 and often under $1. Currently there are almost 2000 baby coins, and that number is growing exponentially. I’ve been following four specific baby coins: Stellar (XLM), Tronix (TRX), Cardano (ADA), and Po.et (POE).

Since these coins are so cheap, it’s thrilling to be able to buy a lot of them, and anticipate they appreciate by factors of thousands. The challenge is that few of these baby coins are traded on the main exchanges (Coinbase or Kraken) or if they are on a main exchange, you can’t buy them for USD, only for Bitcoin. If you’ve read my previous posts, you’ll know I’m not interested in using my Bitcoin because I believe it will continue to appreciate – some forecast to $40,000, $60,000, $100,000 or even $1 million. Last spring people laughed when Bitcoin was forecast to reach $5,000 by December 2017, and it surpassed $5K by October.

I (stupidly) bought a quarter Bitcoin (at its peak price – read all about my lapse in good judgement here) to make whole my beloved Bitcoin that reduced to 0.995 when I moved it from Kraken into a hardware wallet.

To purchase baby coins, you need to use an exchange that trades more obscure coins. Some of those exchanges have bad reputations – they let you deposit but won’t let you withdraw, essentially holding your funds and/or coins captive. Not to stereotype, but this complaint is common for many Russian exchanges. One exchange that seems to have a decent reputation is Binance.

Signing up for Binance was simple – provide an email address and password. They email a confirmation message to you, you confirm through the email, and you’re in. Binance has a fun CAPCHA method – you use a slider to fit a puzzle piece into its empty space. Once in Binance, the user interface isn’t as friendly as Kraken (and I found Kraken confusing at first).

Binance does not support fiat currency (i.e. won’t let you link a bank account to deposit fiat currency). You need to already have cryptocurrency from another exchange (like Kraken) to trade crypto-to-crypto. I don’t want to further fracture my beloved Bitcoin, but I am willing to sacrifice one Ethereum for a baby-coin buying spree.

Having transferred coins from Kraken to my hardware wallet, I had some comfort level of sending a coin from Kraken to Binance. I logged into Kraken, clicked the FUNDING tab, clicked the WITHDRAW tab, the clicked ETHER where it asked me to set up a destination wallet. I toggled over to Binance to find the Ethereum wallet address for my Binance account. You scroll through the LONG list of coins until you see ETH. Then you click on the DEPOSIT button on the far right of the coin’s row. This brings ETH Deposit Address field WHICH WAS BLANK.  I googled “how to send ETH to Binance” and it basically told me to do what I already did. After a few more tries, an address code appeared in the field. I still have no idea what I did to make it appear. When I figure it out, I will write an entry about how to do it because I can’t be the only person perplexed by this process.

I copied the address from Binance into Kraken and saved. Kraken sent me a confirmation email to ensure I did indeed set up an Ethereum wallet to send coins to. I confirmed it, and was able to send 1 whole Ether (which actually ends up being 0.995 ETH because Kraken takes a 0.05 commission).

The blogs and YouTubers all claim that Ether is pretty fast to transfer into Binance. I beg to differ. FOURTY MINUTES passed before my transfer was even ACKNOWLEDGED by Binance. Note I said “acknowledged” not “confirmed”. It took 57 minutes for Kraken to recognize the transfer a success, but Binance still had not confirmed the transfer. I kept checking Binance’s “Deposit History” page and eventually noticed a weird number changing. Forty minutes into waiting for the transfer to confirm, I the message noticed “32/30 Confirming”.  Fifteen minutes later the message was “83/30 Confirming”. Five minutes later it was “95/30 Confirming”. I really hoped it only goes up to 100/30. Two minutes later it showed “Deposit Completed”. An HOUR AND FIFTEEN MINUTES lapsed to successfully transfer the Ether.

At first I clicked the EXCHANGE button on Ethereum’s row next the “DEPOSIT” and “WITHRAWAL” buttons, but that only gave the option of trading ETH for BTC or USD, not trade ETH for a baby coin. So I clicked on the “Exchange” link at the top left of the screen. This gave me the option to choose BASIC or ADVANCED. When given the option, I always default to BASIC.

The BASIC screen looks not very basic to me. It’s a lively screen of graphs, charts, tables and other colorful informatics. The far left of the screen lets you choose BTC, ETH, BNB, USDT and lists a ton of what look like baby coins. I clicked on ETH and the baby coins display their trade ration to ETH. Mercifully it provides a “search” field so you don’t have to scroll through the multitudes of coin offerings.

My first search was XLM which is trading for 0.00097550 ETH. Then I found TRX trades for 0.000115 ETH. ADA trades at 0.00131 ETH. And POE trades at 0.000125 ETH.

Binance has a cool feature that lets you trade 25%, 50%, 75%, or 100% of whatever you’re funded with. In my case, it was the 0.995 ETH. I believed that saved me the ass-ache of calculating 0.995 ETH into quarters. Since I wanted to buy 4 baby coins, I chose to use 25% for each. The graphs showed the prices rising rapidly for all 4 of them, so I just clicked BUY one after the other. I didn’t know if any of my buy requests succeeded, I kept clicking the coins I wanted a pushing the BUY button. Then I clicked the ORDERS link at the top of the page to see which transactions completed successfully.

I clicked ORDERS then TRADE HISTORY and saw that my requests were “processed”, but I couldn’t tell if that meant the purchases were successful. I clicked on ORDERS then OPEN ORDERS and saw I had no open orders which I took as a good sign. Then I clicked on ORDERS > ORDER HISTORY and that showed all of my orders had a status of “Filled” which was comforting. I really like the idea of having no leftover funds to deal with.

I clicked back onto the FUNDS link at the top right of the screen to see if my balances appear for XLM, TRX, ADA, and POE. It shows I have over 2,104.893 TRX; 795.204 POE; 185.814 XLM; 107.892 ADA. But it also shows I have 0. 31547862 ETH! I thought I spent all of my ETH buying 25% of these 4 baby coins. It appears I don’t actually understand Binance’s trading platform.

It took about an hour of thinking before I realized the “25%” option didn’t spit my 0.995 ETH into quarters. Only my first trade was 25% of 0.995 ETH. My next trade was 25% of the remaining 75% of my 0.995 ETH and the trade after that was 25% of the remainder of the previous trade, etc. So each trade was for less ETH than the last. So I guess I really do have to do the math myself and decide how much Ether to spend on the remaining 3 coins. I don’t have the mathematical fortitude to calculate the differences to make an even distribution. I divided my remaining 0.31547862 ETH into thirds to allocate to POE, XLM, and ADA. That means 0.10515954 of an Ether for each.

In the trading interface there is no way to input the amount of ETH you want to spend, you can only input the amount of a coin you want to buy. So I typed in some random numbers and watched the amount of ETH it would cost until it got close to 0.10515954. When I used the rest of my ETH to buy the balance of my baby coins, I clicked back over to FUNDS >DEPOSITS WITHDRAWALS to see my balances. As I suspected, the amount of TRX didn’t change because I already bought 25% of my ETH. The balance of XLM was up, and ADA was up, but it still showed I had 0.10718 of Ether left! I clicked on ORDERS > OPEN ORDERS and saw that my POE purchase is still pending. I clicked back to FUNDS > DEPOSITS WITHDRAWALS and confirmed that my amount of POE did not increase by 813. I’m wondering if I should cancel it and try again or just leave it. What I find curious is Binance has warnings about XLM and ADA trading being heavy and possibly delayed, but those transactions cleared immediately. My poor POE is stuck in purgatory. I check the trading platform again and notice that POE is trading at 0.0014 now, and my purchase was for 0.0013. I tried to cancel the order at least a dozen times so I could raise the buy price, but every attempt to cancel the transaction failed. Then Binance went offline for “system upgrades”. Part of me believes I broke Binance with my constant refreshing. I need to step away from the screen. I hope the price dips so the purchase can clear.

It’s exciting to imagine getting in on the ground floor of what could be the next big coin. While I wait for my POE transaction to complete, I need to finally set up my Ledger Nano S hardware wallet to store these Baby Coins safely off the Internet.

A Bitter Story About A Quarter Bitcoin

I’m embarrassed to admit how much my fractured Bitcoin impacted my psyche – especially as Bitcoin approached $20,000 in early December. When my Bitcoin was whole, I knew how much I had: whatever its valuation was, that’s what I was holding. Now I had to calculate the current price by 0.995 and it disturbed me beyond reason. A well-adjusted person would just round-up and live their life. I’m just not calibrated like that.

As soon as I received a Christmas bonus, I wired it to my Kraken account. At almost $20K, I couldn’t buy a whole Bitcoin, but I could buy a fraction to make it whole once more.

The rational part of my brain said “Use this $5K to buy Ripple – it’s almost a dollar and seems to be increasing a dime a day”. Another part of my brain said “Didn’t you read Ethereum is under-valued? It’s still around $500 – you could buy 10 of them! And if it does go up, you’ll enjoy 10X the profits”.

But the lizard part of my brain said “MAKE MY BITCOIN WHOLE AGAIN”. So I spent $ $4,688.40 USD on 0.25 BTC, which I figured should be enough to preserve its wholeness even if I transfer it a few more times.

Then I felt guilty and used the remaining $298.60 to buy 391 Ripple for $0.76 each.

Not 2 weeks later, Bitcoin fell to $14K, and Ripple doubled to $1.25.

Why oh why will I never learn. It was that same voice that insisted I buy Bitcoin in December 2016 when it was $700 (which I regrettably ignored) that said to buy Ripple instead of Bitcoin with my Christmas bonus. If I listened the first time, that $700 would have grown 20X IN ONE YEAR. And if I listened to that voice regarding my Christmas bonus, and invested the $5K in Ripple, it would have doubled WITHIN A FORTNIGHT. But I followed my emotions and ignored my senses.

When Ripple reached $3, it was small comfort knowing my $298 was now worth almost $1,000, because the masochist in me also calculated the $5,000 I didn’t invest in Ripple could have bought me another whole Bitcoin. Did I mention Ethereum ended up doubling in value too? So that $5000 could have been $10,000 by now.

I need to teach that sensible voice in my head to punch me when I ignore it.

Does anyone else have a bitter Bitcoin story they’d like to share?

Transferring Bitcoin To Trezor Wallet From Kraken

Owning Bitcoin has become part of my identity, partly due to its appreciating value. The trauma of losing my Bitcoin to hackers would be overwhelming, and  I would die of humiliation if my exchange account was hacked before I loaded my cryptocurrency into one of the wallets I ALREADY PURCHASED. I already set up my Trezor wallet, so that’s where I decided to transfer my beloved Bitcoin for safe keeping.

The Trezor hardware wallet works best on a Chrome browser, so I launched Chrome and plugged the Trezor wallet into my laptop’s USB drive and typed in the Trezor Wallet address https://wallet.trezor.io and also logged into Kraken.

Now you have to do something in Kraken and something in the Trezor wallet interface. It doesn’t matter which order, but I did Kraken first.

On Kraken, click on the FUNDING tab, then click on WITHDRAW. Then from the long list of cryptocurrencies running along the left side of the Kraken screen, click on Bitcoin.

Click over to the Trezor wallet tab. You MUST make sure the currency you’re sending from Kraken matches the currency you’re receiving into your Trezor wallet.  This menu to select Bitcoin in Trezor is kind of hidden. At the top left corner of the wallet interface screen is the Trezor name and logo. Under the Trezor name and logo is a > symbol.  Clicking the > shows a menu of cryptocurrencies compatible with Trezor. Select Bitcoin.

You’ll see at the top of the Trezor wallet interface screen are 4 links: “Transactions”, “Receive”, “Send”, “Sign & Verify”. Click on “Receive”.

The top of the “Receive” page will say RECEIVE BITCOIN. Below you will see a 35-character code of upper and lower case letters and numbers. This is your Bitcoin wallet address for your Trezor Hardware Wallet. Highlight and copy this address onto your clipboard.

Click back over to Kraken. On the WITHDRAW BITCOIN screen you will see a button that says “Add Wallet”. Click on this button. Now you’ll see and empty field that says “Description” and an empty field that says “Address”.

The “Description” field is where you type in a reminder of where you’re sending your Bitcoin. I recommend your name or initials, the type of wallet (i.e. Trezor) maybe the color of the wallet (it’s conceivable in the future you may end up with more than one) and the currency (i.e. BTC).

In the “Address” field, paste the wallet address code you copied from Trezor. Then click the green SAVE ADDRESS button.

Kraken will send you an email about your Withdrawal Request. You must open that email and click on the “Confirmation” link within an hour of them sending it, or it will expire. If you don’t confirm this address through the email link, your transfer will not go through. The email should show up immediately. Open it and click on the APPROVE link, then go back into Kraken (you may need to log back in and navigate back to FUNDING > WITHDRAW > BITCOIN).

Now the “Address” field won’t be blank, it will have a pull-down menu. Click the Pull-down menu and you should see the wallet you just saved. Select that wallet so it populates the “Address” field.

Under the “Address” field  is an empty “Amount” field. This is where you fill in how many Bitcoin you want to send to your wallet. Since I only have 1 Bitcoin to transfer, I typed in 1. At the bottom of the Kraken page you will see a big green “REVIEW WITHDRAWAL” button. Clicking on it brings up a new screen where you can double-check the Wallet address and the amount to transfer.

I was nervous to make sure the information matches, so I clicked the big red “CANCEL” button which returns to the screen where you can edit the wallet address or the amount.   After double and triple checking for accuracy, I clicked the big green “REVIEW WITHDRAWAL” button, then the other big green “CONFIRM WITHDRAWAL” button.

Kraken sent an email informing me it received a Withdrawal Request and the name of my Trezor hardware wallet. Since I made this Withdrawal Request, I didn’t have to do anything. If I didn’t make this Withdrawal Request, there is a process to stop it.

Bloggers say a message confirming the withdrawal was submitted successfully will appear in Kraken in less than a minute, and will show a 20-ish character confirmation code. This was not my experience at all.

I saw NO indication in Kraken that the withdrawal was submitted successfully. I saw no indication in my Trezor wallet interface that the withdrawal was submitted successfully. I clicked through Kraken looking for a place that would show me the progress of this transfer. I clicked around inside Kraken and discovered going to FUNDING then WITHDRAWAL shows  a table of recent withdrawals, but this page showed no activity for me.

Of course I flipped out, presuming I did something wrong. Did I copy the address right? Is the wallet plugged in right? Is the internet connection strong enough? I swear I would prefer losing my Bitcoin to hackers than to my own human error.

After about 10 minutes of psychological trauma, Kraken logged me out. When I logged back in, I went back to FUNDING > WITHDRAWAL and saw an entry for my Bitcoin transfer had a “Pending” status. This was somewhat comforting.

I clicked over to Trezor to see if it showed a “Pending” transaction. I clicked on the “Receive” link and saw nothing. I clicked on the “Transactions” link and saw nothing. Bloggers claim it should take about 5 minutes from initiating the transfer from Kraken, to seeing the transfer in Trezor as “unconfirmed”. As you may suspect, this was not my experience. Trezor showed no evidence of an incoming transfer.

Two hours later, still no evidence of Bitcoin coming to my wallet.

I logged back into Kraken and noticed the Balances screen showed I had 0 Bitcoin. This must mean my transfer successfully completed! Wrong. I went back to FUNDING > WITHDRAWAL and saw the status was still PENDING. I noticed if you click on the transfer’s ID Number, a new page appears with details of the transfer. It showed that the transfer initiated 4 hours ago. It also showed it was pending and did not yet have a Transaction ID. I abhor that my Bitcoin is neither in my Kraken portfolio, nor in my hardware wallet, and doesn’t even have a transaction ID.  Can Bitcoin just disappear? It got late and I went to bed miserable.

Upon waking I apprehensively checked my Trezor wallet and saw at 3 a.m. the transfer confirmed. IT TOOK OVER 10 HOURS. The relief of having my Bitcoin in hardware wallet sanctuary turned to horror when I noticed my Bitcoin balance of 0.999 BTC. Apparently transferring a Bitcoin costs 0.001 Bitcoin. I wish there was a way to pay this fee in USD to preserve the wholeness of the Bitcoin, but apparently that’s not how it works. I hate that I own less than a whole Bitcoin. I’m glad that it’s safe in my hardware wallet but depressed it’s no longer whole.

What Is Bitcoin – Best Answer I’ve Found

Unless you program blockchain protocol, it’s hard to really understand Bitcoin or other cryptocurrencies. It seems almost impossible for a Bitcoin expert to explain to a layperson in a comprehensible way, and practically impossible for a layperson to explain Bitcoin to another layperson.

I’ve read a lot of articles about Bitcoin, and found most to be jargon-filled and too technical, or overly simplified and sort of insulting to my intelligence.

Then I read this article and many random facts I gathered started fitting together and making more sense about what Bitcoin is, what it does, and why it’s useful. Feel free to read and share:

https://medium.freecodecamp.org/explain-bitcoin-like-im-five-73b4257ac833

This was published way back in 2013. I’ve seen other bloggers post this same explanation, but they all seem to be plagiarizing Nic Custodio. If I’m wrong, please let me know and I’ll update the link with the true original author.

 

 

 

Buying a Hardware Wallet

The excruciating (but mercifully temporary) inability to log into my cryptocurrency exchange illuminated my need for a hardware wallet to safely store my beloved bitcoin and alt coins. Phone-based wallets exist, but considering the sketchy places I’ve trolled on my phone, it seems a security risk. The safest place to store cryptocurrency is OFFLINE, and that means an unplugged hardware wallet.

A hardware wallet is basically a flash drive. But unlike cheap USB sticks handed out freely at tradeshows and conferences, hardware wallets are more durable and most have additional security features.  The most celebrated hardware wallets by nerds in the know are Trezor, Keepkey, and Ledger Nano S.

These three wallets don’t have an operating system, which means they can’t harbor malware. Apparently, they are safe to use even on a computer that DOES have malware. That’s especially important because you may not even know you have malware.

These three wallets have a Liquid Crystal Display screen which also improves security and makes them easier to use. Apparently wallets without LCD screens rely on inputting information into your computer which is sent to the wallet. If your computer is compromised with malware, the information could be stolen and never make it into your wallet.

Physical buttons on the wallet also let you securely navigate the interface – that means, to make selections and enter passwords. Apparently this is a big security bonus because someone who may be controlling your computer remotely is not able to control physical buttons, and therefore cannot control your hardware wallet (i.e. steal from it). From what I read, it appears the Ledger Nano S and Trezor have physical buttons but the Keepkey does not.

Something to note is NOT ALL WALLETS ACCEPT ALL CRYPTOCURRENCIES. And if you’ve read my earliest posts, you’ll know I have a somewhat diverse portfolio. KeepKey won’t support my Bitcoin Cash, ZCash, Ripple or Monero. Trezor won’t support my Ripple or Monero.  Ledger Nano S is the only wallet supporting Ripple but won’t support Monero (what’s up with no wallets supporting Monero??).

KeepKey not supporting 4 of my cryptocurrencies and lacking physical buttons eliminated it as a possibility. That leaves Trezor and Ledger Nano S.

Ledger Nano S appears to support all my cryptocurrencies except Monero. Bloggers enthuse about Ledger Nano S’s sleek design but I don’t plan to display it. In fact, I plan to hide it.

I did read something about Nano S only holding 3 currencies at a time, which is confusing. The more I read, the more confused I get. Apparently you can load a currency onto Nano S, then erase it and load another, then erase it, until all of your currencies are loaded but only a few can remain on the stick. I also read that the value doesn’t actually RESIDE on the wallet device, which is also hard to comprehend. The idea of ERASING my digital currency freaks me out. I guess I’ll have to buy a Nano S and try it to see for myself. Maybe I really do need to buy a Trezor wallet too so I don’t have to erase anything from the Nano S.

Bloggers encourage purchasing hardware wallets from Amazon.com and rarely discuss buying from the manufacturer’s Website. I suspect Amazon covertly sponsors many blogs.  The trouble with Amazon is the wide price variance for identical products. And many of the vendors have bad ratings, or no ratings, or sell other non-crypto and even non-tech items, which seems unseemly. If I’m buying a device to protect assets worth thousands (maybe hundreds of thousands?) of dollars, I need to believe I’m buying something legitimate.

On Amazon, the Trezor wallet price varies from $99 to $145 – sometimes from the same vendor!  A black version is $99, a white version is $94.99 and a grey version is $145. I can’t imagine anyone would care enough about the color of something so few people would see.  Upon closer inspection it seems like the grey one with the higher price comes with the USB cable, box, and instruction manual, which could account for the $44 difference.

Some vendors accurately identify the Trezor Wallet’s manufacturer as Satoshi Labs. But one vendor says it’s manufactured by Mom Made Foods. WTF?? I need more confidence in my purveyor of crypto security than that. According to many bloggers, you MUST check if your hardware wallet arrives FACTORY SEALED to ensure someone didn’t compromise it. If it doesn’t come factory sealed, you should send it back and get a refund. Also, don’t buy a used wallet.

Amazon has fewer vendors of the Ledger Nano S, but still a wide and confusing mix of prices and product offerings. Some bundle the wallet with a bunch of (seemingly unnecessary) accessories like a carrying case, lanyard, USB cable, Micro USB adapter, and even a ball point pen for almost $150. Some offer just the Ledger Nano S (no cable, no manual) for as low as $72. Personally, I want a manual, and I’m willing to pay extra for it, but I don’t want to buy a bunch of stuff I don’t need. Unfortunately, I don’t know what is necessary and what is superfluous. I’m also concerned that some of the accessories may be after-market and not as durable as the wallet. I don’t want a cable to fail when I’m transferring my digital currency.

It’s not that I don’t trust vendors on Amazon, I don’t trust people in general and prefer to buy directly from the manufacturer. I’m confident the wallet manufacturers will sell what I need: If I need a cable, they will provide an approved cable. If I need a manual, they will provide a manual.

Although I prefer buying directly from the manufacturer, both Trezor and Ledger are overseas and priced in Euros. They both accept payment in Bitcoin which, ironically, I won’t spend because its value keeps appreciating. If Bitcoin’s value was more static, I would enjoy avoiding my credit card’s infuriating foreign currency transaction fees.

In addition to Bitcoin, Trezor’s Website accepts credit cards, while Ledger’s Website accepts credit cards and PayPal.  Both Websites warn their prices do not include taxes and duties. I loathe imagining the hassle of coordinating my  schedule with the delivery guy to write a check for the import tariff. I also wasn’t sure where I put my seldom-used checkbook. Buying from Amazon would be so much more convenient. But that nagging voice in my head (which I’ve regretted ignoring in the past) won me over.  My distrust of online merchants supersedes my lust for convenience.

I decided to buy only one to see how nightmarish the overseas delivery would be. I chose Ledger because it gave 2 non-Bitcoin payment options, and the Ledger Nano S is compatible with 7 of my 8 cryptocurrencies. I wanted to see if I could in fact store them all together on the one stick or if there really was a 3 currency limit. If I could store them all, I wouldn’t need to buy another wallet. If it truly did limit to only 3 currencies, I would store my Ripple, Bitcoin, and Bitcoin Cash onto the Ledger S, and I would buy the Trezor wallet to store my Ethereum, Dash, Litecoin, and ZCash.

I first tried using my credit card on the Ledger site, but the online overseas transaction triggered a security block. So I tried the PayPal option (using the same blocked credit card) and it succeeded. This seemed illogical but I was glad it worked. A confirmation email claimed I would receive my Ledger Nano S in 3 days.  Of course these 3 days fell within the Thanksgiving holiday, complicating calculations of its expected arrival (i.e. when to work at home).  The following Monday I was shocked to see it arrived without any attempt to collect taxes, tariffs or duties. I felt stupid for expecting aggravations.

That night I bought the Trezor wallet from the Trezor Website. The Trezor Website doesn’t accept PayPal, so I first called my credit card company for permission to use my card for an online overseas transaction. The transaction worked, and a confirmation email said to expect my Trezor wallet to arrive in 3 to 5 business days by DHL. I’ve never had a good experience receiving shipments from DHL but I hoped for the best, given the success of my Ledger Nano S purchase.

Four days later, a DHL email announced my package’s scheduled arrival by end of day. I was already at work and considered going home to await the delivery, expecting to write a customs/duty check. When I got home I was shocked to see the package arrived without a request for customs or duty. So it seems if you’re in the continental US purchasing from the Ledger or Trezor Website, you can ignore the stern warning about taxes/tariffs/duties.

Now I’ve got to unpack these wallets. I hope setting them up is as effortless as buying and receiving them.