Guide to Cryptocurrency Wallets: Opening a Bitcoin Wallet

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This guide will cover in great detail on the process of opening Bitcoin wallet. This is an extension of our previous Guide to Cryptocurrency Wallets: Why Do You Need Wallets?

Keeping your Coins in an exchange can present a real risk of you losing them all. Why? Simply because you do not technically “own” the coins you’ve bought in an exchange. Exchanges work like a bank; it is a third-party service provider that you trust to keep your coins safe. However, there is always a probability of the exchange shutting down or being hacked, resulting in a loss of coins (Case in point: Mount Gox exchange). Given the lack of regulatory frameworks on exchanges and cryptocurrencies as a whole as well as the infancy of the industry, the best way to keep your coins safe is to have total control of your coins. (See also: Coins, Tokens & Altcoins: What’s the Difference?)

Having real and true ownership of your Coins means that you control your own private keys. And the only way you can control and manage your private keys is through owning your own wallet. It’s also important to note that in order participate in any ICO, you have to open a Bitcoin or Ethereum wallet as both of them are the most widely accepted base currency for any ICO. (Read more: Beginner’s Guide to ICO Investing: How to Participate in ICOs)

The most common Bitcoin wallet is Blockchain wallet (the wallet is called Blockchain, after the technology which underpins Bitcoin). It is a software wallet that is simple to set up and provides the security benefits of coin ownership. This guide will explain the steps needed for you to open your own Bitcoin wallet. Before we move on, it’s important to understand key terms associated with a wallet. (Read also: Upcoming Bitcoin Hardforks You Should Know: Bitcoin Gold & Segwit2X)

Let’s begin setting up your Bitcoin wallet!

Step 1: Go to Blockchain.info’s Wallet Website

Make sure you bookmark the page, as there have been many cases of phishing sites that mirror Blockchain.info’s site. As a precaution, you should also examine the URL and look for “Blockchain Luxembourg S.A.R.L [LU]” Certificate to authenticate that this is the original site.

Step 2: Complete the Sign-Up Process

Create a new wallet by entering your email and a secure password. It’s good to have a long and arbitrary password to better secure your wallet. If you have a tendency to lose it, make sure you note it down and store it somewhere safe. Click on “Continue” to proceed and you’ll receive a confirmation email.

Step 3: Backup Your Paraphrase

Once you’re logged in, go to the “Security Center” tab on the left side of your dashboard and click on “Backup Phrase”. This is the first level in securing your wallet.

Print the “Recovery Sheet” and write down your 12-word recovery phrase. Be extra careful to ensure that you’ve written the correct word and letters. Store the Recovery Sheet in a safe place.

Step 4: Link Mobile Number & Enable 2FA

Enhance your security by moving towards “Level 2” of the Security Center. Link your mobile number to your wallet and enable 2-Factor Authentication. (See more: Guide to Cryptocurrency Security: Activating 2FA)

Step 5: Block TOR-linked Addresses

Secure the final level in your “Security Center” by blocking IP addresses from the TOR network.

Step 6: Done!

You can begin to receive Bitcoin or Ethereum in your wallet from an exchange or import a paper wallet to start trading. Go to your dashboard and click on “Request” to access your Bitcoin/Ethereum address, where you can start receiving Bitcoin and Ethereum. (Read also: Crypto Guide 101: Choosing The Best Cryptocurrency Exchange)