Now that major online poker rooms like Americas Cardroom have found that Bitcoin can facilitate faster deposits and withdrawals, especially for players in the US, the payment option is becoming more and more attractive.
In this part of the Rakeback.com Bitcoin Guide we begin at the beginning with choosing a Bitcoin ewallet.
Bitcoin is what is called a cryptocurrency. Highly encoded information in the Bitcoin “blockchain” maintains a record of each Bitcoin, or part of a Bitcoin, and which ewallet it belongs to. The blockchain is a complete record of all Bitcoins, shared across the whole network. The system is in itself completely anonymous.
Before buying Bitcoins, you need to have an ewallet which will keep the data record of what Bitcoins you own, and enable you to transfer them to other people and online poker sites. It is your Bitcoin ewallet which creates your private key for encoding your transactions and ensuring that they are completely private and safe.
The Bitcoin wallet is simply a piece of software, so which wallet you choose depends on where you want to use it. There are versions for Windows, OSX, and Linux, iPhone, iPad, and Android-powered smartphones. One of the most popular forms of wallet is device independent, and operates in your browser.
If you expect to keep a large balance of Bitcoins, you should use a wallet which enables offline storage, but for online poker, the best strategy is to keep your money in the form of Bitcoins for as little time as possible.
Our recommended strategy is to buy your Bitcoins and deposit them onto the poker site straightaway, or when making a withdrawal convert them straight back into cash in your bank account. This avoids any exchange rate risk—Bitcoin is very like a foreign currency, where the amount you get for each US Dollar changes every day.
The home site for all things Bitcoin is Bitcoin.org, which is the official site of the organisation which manages the currency. Bitcoin.org lists over a dozen wallets, suitable for all types of operating system and device.
The Armory, Hive, MultiBit and DarkWallet are the most popular of the wallets for use on your desktop. The most popular mobile wallets are Mycelium, Xapo, and Blockchain. Coinbase, Circle, Blockchain, and Xapo are the most common web-based wallets.
All of them can be set up in a matter of a few minutes.
There have been several well publicised instances of Bitcoin wallets being hacked and the Bitcoins stole. Your Bitcoin account should be treated with the same level of security that you treat your online poker account. A few simple protection measures will keep your money as safe as possible.
In the next article we will take a look at Bitcoin Exchanges where you can use your credit or debit card to buy Bitcoins to store in your wallet.
By Joss Wood Rakeback.com Content Manager
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