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CryptoCurrencies – Security, Mnemonic and 2FA

By on July 4th, 2018

In my previous post, I wrote about the importance of owning your own keys instead of keeping your coins in an online wallet or on an exchange.  Owning your own keys brings with it the responsibility of keeping it safe and out of the hands of other people.  To do this it is important to have strong security in protecting your assets and investments.

There are mainly 3 items that come into play here:

  • Your password or sometimes called a passphrase.
  • Mnemonic words – these are between 12 and 24 randomly chosen words.
  • Two Factor Authentication (2FA)

Password / Passphrase

Most if not all wallets use a password or passphrase to give you access to your funds and more importantly to encrypt the wallet information when it stores it on your device.  It is important to have a strong password that you can remember.  I usually use some phrase that is fairly long, at least 20 characters and I include characters like “!@#$%^&*-_” in my passphrase.  If you scared that you will forget your password or passphrase then write it down on a piece of paper and store it safely in a safe.  Do not store it on some online storage like Dropbox and/or Google Drive.

Mnemonic or otherwise know as a seed

A mnemonic phrase, mnemonic recovery phrase or mnemonic seed is a list of words which store all the information needed to recover a Bitcoin wallet. Wallet software will typically generate a mnemonic backup phrase and instruct the user to write it down on paper.  Best is to make several copies of it and store it in different places.  Also good to laminate it since it might fade over time if not protected. If the user’s computer breaks or their hard drive becomes corrupted, they can download the same wallet software again and use the paper backup to get their bitcoins back.

Anybody else who discovers the phrase can steal the bitcoins, so it must be kept safe like jewels or cash. For example, it must not be typed into any website. Also do not ever store it somewhere on your computer or any online storage like Dropbox and/or Google Drive.

Two Factor Authentication (2FA)

Two-factor authentication (also known as 2FA) is a type (subset) of multi-factor authentication. It is a method of confirming a user’s claimed identity by utilizing a combination of two different factors: 1) something they know, 2) something they have, or 3) something they are.

A good example of two-factor authentication is the withdrawing of money from an ATM; only the correct combination of a bank card (something that the user possesses) and a PIN (personal identification number, something that the user knows) allows the transaction to be carried out.

The most common use is when one logs into a website with a Username and Password and are then presented with another screen requesting the user to enter a code.  One way is that this code is sent to the user’s registered email address or more commonly his cellphone via SMS.   Another way and the more preferable way is that the user uses a code that he gets from an application on his cellphone.  Google Authenticator is one such application but the one that I prefer is Authy.

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Bitcoin – Sick and tired of hearing about crash

By on June 29th, 2018

I am getting so sick and tired of hearing about how Bitcoin has crashed everytime it drops by a couple of hundred dollars.  Then every Tom, Dick and Harry has something to say and write about the death of Bitcoin  Well, Bitcoin has died at least 6 or 7 times and will probably die another who knows how many times.

When it rises a couple of hundred dollars, these neigh sayers is nowhere to be found and nobody is writing about the sudden resurrection of Bitcoin and how it stood up from its grave.

Today a year ago Bitcoin was at $2564.83, more than half of what it is today.  Yes, that is correct, we are more than 100% up from the same time last year.  Who in their right mind can complain about 100% growth in 1 year?

I am no financial adviser, so this is only my opinion and if you want some advice, then it is a good time to accumulated Bitcoin and below is some way to do it.

bitcoin, cryptocurrencies 1 comment

CryptoCurrencies – No Keys No Coins

By on June 5th, 2018

Whoever controls your private keys controls your crypto. If that’s not YOU, that’s not good.

So what does this really mean?

Let’s first look at Fiat currencies like USD, ZAR or any currency for that matter.  Most of the currencies you “own” is in some bank account.  Now you might think that you own that money but you are wrong.  The bank owns that money and only have some form of IOU (I owe you) with you, with other words the bank promises to give you back your money when you come to ask for it. If something goes wrong with that bank and it goes bankrupt then you have a problem and there is a real possibility you will lose some of that money.  So you have to trust the bank that they will look after your money and keep their word.

When it comes to cryptocurrencies and bitcoin in particular, you do not have to trust anybody and can keep control of your “money”.  This means you have to store your cryptocurrency somewhere where you have control of your Private Keys – if you do not know what Private Keys are, then have a look here. It is basically the “key” to prove that you are the owner of the coins at a certain Public Address or simply called the Address.

Now how do you keep control of your coins?

You use a wallet where you have access and control of your Private Keys.  That means you do not store your coins on some exchange for long-term storage.  Yes, sometimes you have to put your coins on an exchange to convert it to either another coin or back to fiat currency.  But only keep it on an exchange for the period of the transaction and then move it back to where you have control of your keys.  If you do day trading then you have to keep it on the exchange but be aware of the risks of keeping your coins on the exchange.

There are lots of wallets out there, some better than others but the most important factors is not to use an online one since about all of them do not give you your keys which mean you do not own the coins.

What do I use?

My main wallet is one on my Mac Laptop and that is Exodus which is a multicurrency wallet.  However, I only store a very small amount of my coins here, the rest is stored on a Ledger hardware wallet. By using either of these options I keep control of my keys and hence I own my coins.  It does not matter what a government or anybody do, they cannot get hold of my coins and hence take my coins.

However, with this comes a responsibility and that is that you need to keep your keys and access to your keys safe.  If anybody gets hold of your keys then they can take your coins.

Keep your keys safe and with that, you are keeping your investment in cryptocurrencies safe.

For reference, I use the following exchanges:

  • For converting from and to fiat (ZAR): Luno.
  • For trading and converting of coins: Binance.
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Earn and Accumulate Bitcoin the simple way: Earn.com [Update]

By on January 19th, 2018

Earn.com

Replace your public email with an inbox that pays you!

Update: Earnings from 1 Jan 2018: 0.00180905 BTC ($22,82 at time of publishing this post)

Set up an Earn.com profile to receive paid messages from people outside your network.

It’s like LinkedIn InMail, except you get paid!

There are various lists that you can join that covers invitations for ICO’s, people that look for developers, people that look for writers or somebody that just need your advice and input on some subject.  When you are contacted and you respond, you will be paid the equivalent in Bitcoin from anything from $1 to $20 or even more.  I once was paid $20 just for answering two simple questions.

You can even connect your Gmail account to bounce emails from people outside your social network. If they want to get in touch, they can pay you to reply.

All you need to do is Click Here and start accumulating your Bitcoin.

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[Update] Bitcoin: How long to accumulate 1 BTC by buying $20 per day?

By on November 19th, 2017

I came across this tweet today which lets one think a bit.

[Update]: So my maths was totally wrong.  Updated below with the correct values

To put that into context. $20 per day for 2 years (802 days to be exact) will be around $16040 invested.  Using the 0.2% growth as per the tweet, the bitcoin price after 802 days would be $39640.  Some of you might disagree with that growth but just look what happened over the past year, then this is not so far fetched.

So although 2 years sounds a long time to accumulate that 1 BTC, it is still very much worth it.

If we assume that bitcoin price will be $39640 in 2 years then your investment of $16040 would have grown by 147% in 2 years.  In my books that is not bad going.

It does not matter how small you start, the moral of all this is to start.

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Bitcoin and Crypto Journey – layman’s experience.

By on November 9th, 2017

With Bitcoin  currently trading at around $7200.00, that is around R102000.00, I want to give you, the reader a view of my experiences.  I am what they call a HODL. ie I am a holder of Bitcoin and other crypto currencies and not a trader at all.

I will try to give you an overview of my journey up to now, what I use and how I obtain my crypto currencies.  Items I will cover over the next couple of posts are as follows:

  • Explanation of what things mean and what impact it may have or not have.  Now that Segwit2X is a non-event (was withdrawn/cancelled yesterday – a good thing in my opinion), I do not have to cover that but will talk about forks and hard forks in particularly.  There is the Bitcoin Cash fork and I will cover how to claim your coins if you have not done so.  Then there is the Bitcoin Gold fork that is happening at the moment, will give my view on it and also if and when claiming of your Bitcoin Gold coins open, I will explain how to go about it.
  • I will talk about how important it is to have control of your own private keys and not to leave your coins in the cloud or a web based wallet where you do not control your keys.
  • I will talk about wallets, what my views are and what I use.
  • Opinion about what is happening in the crypto world, my interpretation of it and if any impact there is on us as South Africans in particular.
  •  Best sources to use for information and where I get my information to keep up to date.
  • How to buy crypto in South Africa and to get the best possible price.
  • I will also be open about my investment so you can see that what I am talking about is possible and with patience you can also accumulate and own crypto.
  • I will show examples of how I keep track of my investments.
  • Any other subject that comes up in the fast changing world of cryptocurrencies.

Feel free to comment particularly if you have questions or want something specific you want me to cover.

Last comment and I am making it bold, do not invest hard earned money that you are not prepared to loose.  The crypto market is very volatile with lots of risk which mean you can easily loose but at the same time you cab have massive gains — like mine that are at the moment over 500%

If you like what you read then you can donate BTC (that is the ticker for Bitcoin) to the address at the top of this page.

technology No comments yet

Bitcoin Cape Town meetup

By on March 1st, 2017

bitcoin2-600x339

  • Are you interested in Bitcoin?
  • Do you live in Cape Town?
  • Want to hear one of the most renowned and well-respected figures in Bitcoin speak?

If you answer YES to all the questions above then make your way here to reserve your ticket.  It is only R100.00 or about 641000 Satoshi‘s

The keynote speaker is Andreas Antonopoulos, the author of Mastering Bitcoin.

Luno, the Bitcoin Exchange is sponsoring the event so come and mingle and have some drinks.

Oh the meetup is Monday evening, 6 March 2017 @ 17:30. See you there.

bitcoin, books, Learning No comments yet

Bitcoin: a new journey – Glossary

By on February 13th, 2017

Bitcoin Glossary

For a couple of years now I have been interested in bitcoin and cryptocurrencies and have embarked on a road of educating myself with it.  On of the first stumbling blocks is to get used to terms used and Bitcoin speak.  I am currently reading Mastering Bitcoin from Andreas Antonopoulos and found exactly what I need and are reporducing[1] it here for easy reference.

address

A bitcoin address looks like 1DSrfJdB2AnWaFNgSbv3MZC2m74996JafV. It consists of
a string of letters and numbers starting with a “1” (number one). Just like you ask
others to send an email to your email address, you would ask others to send you
bitcoin to your bitcoin address.

bip

Bitcoin Improvement Proposals. A set of proposals that members of the bitcoin
community have submitted to improve bitcoin. For example, BIP0021 is a proposal
to improve the bitcoin uniform resource identifier (URI) scheme.

bitcoin

The name of the currency unit (the coin), the network, and the software.

block

A grouping of transactions, marked with a timestamp, and a fingerprint of the
previous block. The block header is hashed to produce a proof of work, thereby
validating the transactions. Valid blocks are added to the main blockchain by network
consensus.

blockchain

A list of validated blocks, each linking to its predecessor all the way to the genesis block.

confirmations

Once a transaction is included in a block, it has one confirmation. As soon as
another block is mined on the same blockchain, the transaction has two confirmations,
and so on. Six or more confirmations is considered sufficient proof that a
transaction cannot be reversed.

difficulty

A network-wide setting that controls how much computation is required to produce
a proof of work.

difficulty target

A difficulty at which all the computation in the network will find blocks approximately
every 10 minutes.

difficulty retargeting

A network-wide recalculation of the difficulty that occurs once every 2,106 blocks
and considers the hashing power of the previous 2,106 blocks.

fees

The sender of a transaction often includes a fee to the network for processing the
requested transaction. Most transactions require a minimum fee of 0.5 mBTC.

hash

A digital fingerprint of some binary input.

genesis block

The first block in the blockchain, used to initialize the cryptocurrency.

miner

A network node that finds valid proof of work for new blocks, by repeated hashing.

network

A peer-to-peer network that propagates transactions and blocks to every bitcoin
node on the network.

Proof-Of-Work

A piece of data that requires significant computation to find. In bitcoin, miners
must find a numeric solution to the SHA256 algorithm that meets a network-wide
target, the difficulty target.

reward

An amount included in each new block as a reward by the network to the miner
who found the Proof-Of-Work solution. It is currently 25BTC per block.

secret key (aka private key)

The secret number that unlocks bitcoins sent to the corresponding address. A secret
key looks like 5J76sF8L5jTtzE96r66Sf8cka9y44wdpJjMwCxR3tzLh3ibVPxh.

transaction

In simple terms, a transfer of bitcoins from one address to another. More precisely,
a transaction is a signed data structure expressing a transfer of value. Transactions
are transmitted over the bitcoin network, collected by miners, and included into
blocks, made permanent on the blockchain.

wallet

Software that holds all your bitcoin addresses and secret keys. Use it to send, receive,
and store your bitcoin.

[1] – Reproducing from “Mastering Bitcoin by Andreas M. Antonopoulos (O’Reilly). Copyright 2015 Andreas M. Antonopoulos, 978-1-449-37404-4.”
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PHP upgrade on Dreamhost

By on October 18th, 2016

Short post to verify and check that all went correctly in upgrading PHP from version 5.5 to PHP version 5.6.

All looks fine and all seem to be working, please comment if you see anything weird.

Android, Google, hardware, Mobile 4 comments

Google Pixel and Pixel-XL, but will we get it in South Africa?

By on October 5th, 2016

google pixel pixel-xl south africaOn 4 October, Google announced their new Google branded cellphone called Google Pixel and Google Pixel-XL.  The hardware for these phones are made by HTC.  HTC has always made good phones and I like the build quality of their phones but they are not that good at marketing so the relationship with Google will be a good one.

The question now arises whether we will be seeing this phone in South Africa.  The only way to get it in South Africa is either via one of the mobile operators since buying it from the Google Play Store in South Africa is not an option.

I have looked around on some of the online stores in South Africa but have not come across anywhere where it can be pre-ordered.

As an Android user and somebody that will not switch to iPhone, I would like to get either the Pixel or preferable the Pixel-XL since I live on my phone and like the bigger one.  Also I am a avid hiker, see my Hiking site, both the Pixel and Pixel-XL has great cameras and would come in very handy when hiking.

google-pixel-lineup-768x463

The 3 colors that will be available for the Google Pixel and Pixel-XL phones.  I am leaning toward the blue one, lets have a bit of color in our lives.

Would love to hear what you think so leave a comment below.