We have already talked about the many reasons why one should own Bitcoin. The first digital currency has seen huge success since 2009 and has found its way into the portfolio of many investors and gamers from around the world. But although many people have bought it on centralized exchanges like Binance and Coinbase. Or earned it by playing games. Only a small group of these people really understands how to use it. And what to use it for.
So if you already have some Bitcoin or are interested in holding some in the future. Have you already asked yourself “how do I start using my Bitcoin?”.
Well before we can start using Bitcoin, we need to understand why it exists and what its use cases are. Check out our previous blog that explains you all about it here!
How to use Bitcoin as digital money
To start using Bitcoin you will of course need some Bitcoin first. You can do this by buying some BTC on an exchange like Binance, Kraken, or Coinbase. BTW, not financial advice! Once you have some we can start to use it as digital money.
Put simply if we want to use Bitcoin as money we will have to use it to transact. Or buy something. To do this we will first have to put the Bitcoin in our own wallet or use a debit card from the custodial that holds our Bitcoin. This could be Binance for example. Because you would also not go to the store with an empty wallet while also leaving your credit/debit card at home right?
Finding a wallet is easy just go to our wallet finder page and choose a Bitcoin wallet. But you can also take a lightning wallet for cheaper transactions or a wallet that allows you to use a physical card.
Now send your Bitcoin from where you first got it to your wallet. This can be done by withdrawing from the exchange and filling in the Bitcoin address of your wallet or new custodian. Almost just like sending an email. If you send it over the main Bitcoin network this could take a few minutes.
Going to the store
Now you can go to the store and spend some BTC (make sure they accept BTC first of course). At checkout, the store or webshop will show you an address or QR code that you can scan to send them the payment in Bitcoin. Just scanning the code with your wallet should do the trick. In case you would use a physical card from Visa or Mastercard you can just use these the same way as you normally would, the store does not even have to accept BTC. Because the currency will be exchanged instantly behind the scenes.
Take a quick look here to see how to pay using the Bitcoin lightning network in El Salvador.
How to use Bitcoin as a store of value
Using Bitcoin as a store of value might be the easiest thing of all. The only thing you need to do is have Bitcoin and just keep it. Because of the limited amount of BTC that will ever exist. That means that from 2009 till forever no more than 21 million BTC will ever be created. Whereas with fiat currencies like the dollar, Euro, and many others, the supply will keep on growing forever. This creates inflation over time which devalues the value of the fiat money that people use.
Bitcoin will never have this problem. And even though it moves up and down against other currencies. 1 Bitcoin today will still be 1 Bitcoin tomorrow. Making it so that over time Bitcoin should protect you against inflation and work as the perfect store of value for the digital age.
If you hold Bitcoin as a store of value. Then please make sure you keep it in a safe place. Losing your BTC would be horrible so always make a backup and store it on a wallet that is safe or with a custodial you trust (preferably one that has insurance). This way you minimize your risk against loss of assets and against inflation.
How to use Bitcoin to escape your government tyranny
Let’s say you live in Turkey, where your currency inflates at an exponential rate. Or in Brasil where you have to pay a high tax to switch to the dollar. Laws like these can make it super difficult for its citizens to travel to other places because of the cost. And takes away the right for them to protect their wealth. From the relatively light examples, we gave you here to the example of governments taking control of your bank account because you said something wrong on Twitter. It does not matter much. Right now if you use a fiat currency like the Dollar or Euro. The central government printing it, together with the banks, control your wealth and all that it interacts with.
For many people in developed western countries, this has not caused too many problems so far. But in many other countries, it has. This problem could just as well happen in the west as in the east and it all originates from the fact that money and the money supply are not directly controlled by the people.
Bitcoin solves this by having a permission less monetary network. Making it so that no one organization can stop the transactions or block people out of the system. Countries like Turkey, Brasil, China, Venezuela, and many others can, and in the case of some people already do benefit from Bitcoin. Just by the simple fact that people can decide for themselves what they want to do with their money. Instead of being tyrannized by an incompetent government or dictator.
How to use Bitcoin for web3
Bitcoin currently does not support complicated smart contracts. Because of this, the blockchain network can not really run much of the web3 applications. To counter this layer 1, 1.5, and 2 solutions for Bitcoin exist. These solutions make use of the Bitcoin protocol but build some extras next to it to make it faster and have more features. A project called Stacks works on bringing the smart contract to Bitcoin. Giving it all the same features for decentralized application hosting as Ethereum does.
When it comes to web3 and Bitcoin we usually come to the idea of Bitcoin being used as a security layer and the application run on another network. For now, we have not seen that much web3 integrated with Bitcoin. As it is still all very new.
What we do see more often is that people wrap Bitcoin. Or bridge Bitcoin to another blockchain. This way Bitcoin can function just like any other token on that chain and interact with Defi applications. Giving you and others the option to earn decentralized interest on your BTC.
How to use Bitcoin from your phone
To start using Bitcoin from your phone you will need a mobile wallet. Preferably one that supports the lightning network. Once you have one you can start using Bitcoin on your phone. You can do this by simply sending and receiving transactions in BTC on your phone. Whether transactions for purchases or for just receiving payments from friends is totally up to you.
You could also use it as the place to receive your earnings from Bitcoin games. So you can stack some Sats no matter where you are. But most importantly a mobile Bitcoin wallet functions as a normal cash wallet would. Only instead of holding dollars in it, you hold BTC.
How to use Bitcoin from your PC
Using Bitcoin on your PC works basically the same as using it from your mobile phone. With the only main difference being that your PC probably stays in one place and your phone doesn’t. This comes both with benefits of portability for the mobile wallet and more safety for your Desktop wallet as it stays in the same place. So it is less likely to be stolen.
Desktop wallets have benefits for when you work with your PC. But are usually still online wallets (directly connected to the internet) making them not as secure as a hardware wallet.
How to safely store Bitcoin offline
To keep your Bitcoin in a safe place you need to keep it on a device that not only is virus-free. But also keeps the keys offline. The types of wallets that do so we call hardware wallets. A hardware wallet keeps your crypto stored offline making it impossible to hack. Hardware wallets come in a variety of forms from USB-looking devices to metal plates with private key on them. The point is that on a device like this no hacker can access it and your crypto should be as safe as it can be.
If you buy Bitcoin, with the main idea of holding on to it as digital gold. Then a hardware wallet is definitely recommended. Especially if the price of your crypto goes up over time. Now a hardware wallet works ideal but please remember that even the best hardware wallets like Ledger, Ballet, or Cobo Vault do not protect you against fire, earthquake, or other natural disasters. So having a backup to these wallets is super important. This can either be in the form of a spare hardware wallet in a different location or a written-down backup code. No matter how you want to protect your cryptocurrency, making backups and storing them in a safe location is super important.
See our Ballet pro series hardware wallet review here!
If you want to start using Bitcoin for real and not just look at it from a distance. Then you should also understand “why Bitcoin?”. In our other blog “The 7 main use cases for Bitcoin“, we explain why Bitcoin can help us as humanity adopt a better money system with more intrinsic value. But if you already feel like getting started with a free Bitcoin wallet then go ahead!
We hope you understand how to use Bitcoin much better now. If you feel ready to start using your own Bitcoin wallet? Then check out our Wallet finder function. Or read one of our other blogs or reviews to learn more about Bitcoin and other cryptocurrencies!
What is Web3?
The next evolution of the internet we call web3. The big difference between web3 against web 1 & 2 is that web3 runs on top of a blockchain system. Making the applications on it permissionless and more private.
Can I use Bitcoin for trading in web3?
Yes, if you have a Bitcoin token on a web3 application you can use it for trading. Be aware that trading of any token or coin comes at risk when traded on web3 just as well as on a centralized crypto exchange.
What is the best crypto mining app for my phone?
That really depends on what crypto you want to mine and in what way. Luckily we did a whole post on mobile crypto mining! Where we till you all about it!