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@ -99,23 +99,23 @@ Web client:: ((("web clients")))Web clients are accessed through a web browser a
The choice of bitcoin client depends on how much control the user wants over funds. A full client will offer the highest level of control and independence for the user, but in turn puts the burden of backups and security on the user. On the other end of the range of choices, a web client is the easiest to set up and use, but the trade-off with a web client is that counterparty risk is introduced because security and control is shared with the user and the owner of the web service. If a web-wallet service is compromised, as many have been, the users can lose all their funds. Conversely, if users have a full client without adequate backups, they might lose their funds through a computer mishap.
For the purposes of this book, we will be demonstrating the use of a variety of bitcoin clients, from the reference implementation (the Satoshi client) to web wallets. Some of the examples will require the use of the reference client, which exposes APIs to the wallet, network, and transaction services. If you are planning to explore the programmatic interfaces into the bitcoin system, you will need the reference client.
For the purposes of this book, we will be demonstrating the use of a variety of downloadable bitcoin clients, from the reference implementation (the Satoshi client) to web wallets. Some of the examples will require the use of the reference client, which exposes APIs to the wallet, network, and transaction services. If you are planning to explore the programmatic interfaces into the bitcoin system, you will need the reference client.
==== Quick Start
((("bitcoin","wallet setup")))((("wallets","setting up")))Alice, who we introduced in <<user-stories>>, is not a technical user and only recently heard about bitcoin from a friend. She starts her journey by visiting the((("bitcoin.org"))) official website http://www.bitcoin.org[bitcoin.org], where she finds a broad selection of bitcoin clients. Following the advice on the bitcoin.org site, she chooses the lightweight bitcoin client((("Multibit client"))) _Multibit_.
((("bitcoin","wallet setup")))((("wallets","setting up")))Alice, who we introduced in <<user-stories>>, is not a technical user and only recently heard about bitcoin from a friend. She starts her journey by visiting the((("bitcoin.org"))) official website http://www.bitcoin.org[bitcoin.org], where she finds a broad selection of bitcoin clients. Following the advice on the bitcoin.org site, she chooses the lightweight bitcoin client((("Multibit client"))) Multibit.
Alice follows a link from the bitcoin.org site to download and install Multibit on her desktop. Multibit is available for Windows, Mac OS, and Linux desktops.
[WARNING]
====
((("wallets","security of")))A bitcoin wallet must be protected by a password or passphrase. There are many bad actors attempting to break weak passwords, so take care to select one that cannot be easily broken. Use a combination of upper, and lowercase characters, numbers, and symbols. Avoid personal information such as birth dates or names of sports teams. Avoid any words commonly found in dictionaries, in any language. If you can, use a password generator to create a completely random password that is at least 12 characters in length. Remember: bitcoin is money and can be instantly moved anywhere in the world. If it is not well protected, it can be easily stolen.
((("wallets","security of")))A bitcoin wallet must be protected by a password or passphrase. There are many bad actors attempting to break weak passwords, so take care to select one that cannot be easily broken. Use a combination of upper and lowercase characters, numbers, and symbols. Avoid personal information such as birth dates or names of sports teams. Avoid any words commonly found in dictionaries, in any language. If you can, use a password generator to create a completely random password that is at least 12 characters in length. Remember: bitcoin is money and can be instantly moved anywhere in the world. If it is not well protected, it can be easily stolen.
====
Once Alice has downloaded and installed the Multibit application, she runs it and is greeted by a "welcome" screen, as shown in <<multibit-welcome>>.
Once Alice has downloaded and installed the Multibit application, she runs it and is greeted by a Welcome screen, as shown in <<multibit-welcome>>.
[[multibit-welcome]]
.The Multibit bitcoin client—Welcome screen
.The Multibit bitcoin client Welcome screen
image::images/msbt_0101.png["MultibitWelcome"]
((("addresses, bitcoin","created by Multibit")))Multibit automatically creates a wallet and a new bitcoin address for Alice, which Alice can see by clicking the Request tab shown in <<multibit-request>>.
@ -123,7 +123,7 @@ image::images/msbt_0101.png["MultibitWelcome"]
.Alice's new bitcoin address, in the Request tab of the Multibit client
image::images/msbt_0102.png["MultibitReceive"]
The most important part of this screen is Alice's _bitcoin address_. Like an email address, Alice can share this address and anyone can use it to send money directly to her new wallet. On the screen it appears as a long string of letters and numbers: +1Cdid9KFAaatwczBwBttQcwXYCpvK8h7FK+. Next to the wallet's bitcoin address, there is a QR code, a form of barcode that contains the same information in a format that can be easily scanned by a smartphone's camera. The QR code is the black-and-white square on the right side of the window. Alice can copy the bitcoin address or the QR code onto her clipboard by clicking the copy button adjacent to each of them. Clicking the QR code itself will magnify it, so that it can be easily scanned by a smartphone camera.
The most important part of this screen is Alice's _bitcoin address_. Like an email address, Alice can share this address and anyone can use it to send money directly to her new wallet. On the screen it appears as a long string of letters and numbers: +1Cdid9KFAaatwczBwBttQcwXYCpvK8h7FK+. Next to the wallet's bitcoin address is a QR code, a form of barcode that contains the same information in a format that can be scanned by a smartphone camera. The QR code is the black-and-white square on the right side of the window. Alice can copy the bitcoin address or the QR code onto her clipboard by clicking the copy button adjacent to each of them. Clicking the QR code itself will magnify it, so that it can be easily scanned by a smartphone camera.
Alice can also print the QR code as a way to easily give her address to others without them having to type the long string of letters and numbers.
@ -139,8 +139,8 @@ Alice is now ready to start using her new bitcoin wallet.
((("bitcoin","acquiring")))((("currency markets")))It is not possible to buy bitcoins at a bank or foreign exchange kiosks at this time. As of 2014, it is still quite difficult to acquire bitcoins in most countries. There are a number of specialized currency exchanges where you can buy and sell bitcoin in exchange for a local currency. These operate as web-based currency markets and include:
* Bitstamp((("Bitstamp currency market"))) (http://bitstamp.net/[bitstamp.net]), a European currency market that supports several currencies including euros (EUR) and US dollars (USD) via wire transfer.
* Coinbase((("Coinbase currency market"))) (http://www.coinbase.com/[coinbase.com]), a US-based bitcoin wallet and platform where merchants and consumers can transact in bitcoin. Coinbase makes it easy to buy and sell bitcoin, allowing users to connect to US checking accounts via the ACH system.
http://bitstamp.net[Bitstamp]:: A European currency market that supports several currencies including euros (EUR) and US dollars (USD) via wire transfer.((("Bitstamp currency market")))
http://www.coinbase.com[Coinbase]:: A US-based bitcoin wallet and platform where merchants and consumers can transact in bitcoin. Coinbase makes it easy to buy and sell bitcoin, allowing users to connect to US checking accounts via the ACH system.((("Coinbase currency market")))
Crypto-currency exchanges such as these operate at the intersection of national currencies and crypto-currencies. As such, they are subject to national and international regulations, and are often specific to a single country or economic area and specialize in the national currencies of that area. Your choice of currency exchange will be specific to the national currency you use and limited to the exchanges that operate within the legal jurisdiction of your country. Similar to opening a bank account, it takes several days or weeks to set up the necessary accounts with these services because they require various forms of identification to comply with((("AML (Anti-Money Laundering) banking regulations")))((("banking regulations and bitcoin")))((("KYC (Know Your Customer) banking regulations"))) KYC (Know Your Customer) and AML (Anti-Money Laundering) banking regulations. Once you have an account on a bitcoin exchange, you can then buy or sell bitcoins quickly just as you could with foreign currency with a brokerage account.