Another Crack at Crypto - Harrowing Experience, But Kind of Fun?

Okay, in my last post, I wrote War and Peace. No, really, somebody else already wrote that half-million-word book, but my last blog post certainly was long. I gave a run-through of my personal experiences with cryptocurrencies. Learning to use them had been quite stressful, though I'd gained money, not lost it (I think). I'll have to do the math, but I think I'm still ahead.

In learning to use crypto, I had read lots of articles and watched tutorials, experimented with a few exchanges, sent money wallet to wallet, and used the blockchain to track my balances. I had put money into a paper wallet, but had not yet gotten money out of one. I was a little nervous, but not that fearful. I felt comfortable with the concepts involved in paper-to-web transfers, and only a little afraid of the interfaces I had seen, which were somewhat old-school techy--you know, solid gray boxes and fields, kind of like the old FTP interfaces that scared me so much (fearful geek that I am).

Tonight, I am older and wiser. I have used Blockchain.info to import my Bitcoin from my paper wallet and export it to two places: a wallet in the Bitsane Exchange, and a Jaxx wallet. Once again, the experience of doing something new with crypto proved harrowing. My advice is, "Don't try this at home." (Or anywhere else). Seriously, only use paper wallets if you're serious about cryptocurrency's long-term potential and you don't mind losing a few fees while you experiment. There are other good uses, of course, including person-to-person transfers, avoiding exchanges altogether.

My exchanges were successful, in spite of high fees. But figuring out how to do things involved a lot of trial and error and guesswork. I had watched some tutorials on YouTube and thought I knew how to do this thing. I should mention that, at some point during this process, I signed up on the Blockchain.info site using my email address, and verified it. I'm not sure if that was required. They emailed me a wallet-code/username to log in with. So now when I click "Get Free Wallet," the site recognizes me and that username comes up; I put in my password and log in.

On Blockchain.info's home page (even before logging in) I used the hash searchbox at the bottom of the home page to check the balance in my existing paper wallet again. It was slightly depleted by negative rate fluctuations over the past week or so, but I still had over $100 to play with. I gathered the various target wallets I planned to use to receive my funds (one at Jaxx, one at Bitsane, one at Blockchain).

I had already watched third-party tutorials on the process of emptying a paper wallet into a Blockchain wallet. All of the tutorials showed the Blockchain menu as having an "Import/Export" link at the top. First big snafu! This link did not exist. I looked and looked. It certainly wasn't at the top of the page with the other menu items. So, I clicked around in the site and still couldn't find it.

Screenshot of Blockchain.info's home page.

Closeup of Menu Items on Home Page:

Closeup of menu items on Blockchain's home page.

No Import/Export Item (including links in the drop-downs under each item). I went to the FAQ. Nothing. Then I did a quick Google Search. I found the usual maddening, chaotic mix of guesses and opinions (many quite rude), but couldn't find my answer. Finally, one person mentioned "Settings." I went there, and still no Import/Export link, nothing that looked like the tutorials. But at last, under "Addresses," I found a demure, nondescript little text link for imports. Here's how I found it:

From Blockchain.info's home page, I clicked on "Get Free Wallet." (Here, I'm working from memory: I don't think the code that came up at this point was the wallet. It may be the user identification, kind of like a username for your wallet. It is a longish, private key with hyphens in it).

Using the wallet/log-in ID that Blockchain sent me and the password I created, I logged into my wallet/dashboard interface.

The resulting screen is a dashboard, similar to the one below (accessed Jan. 10, 2018). It says "Be Your Own Bank." It has "Your Balances" ($0 until you deposit something). And it has some charts.

On the dashboard, in the left-hand sidebar: 

Click "Settings."

The next screen shows your Wallet ID (PRIVATE!) and a Mobile Pairing Code/QR (also private).

In the left-hand sidebar:

Click "Addresses" and get the screen below:

It says "Be Your Own Bank." Under that are two buttons ("Send" and "Request"); an alert; a link for Bitcoin and Bitcoin Cash; a default wallet ("My Bitcoin Wallet"); a link that says "+ Add" (to add a wallet); a title ("Imported Bitcoin Addresses" with an informational alert, "Not backed up..."); and FINALLY, this link:

+ Import Bitcoin Address. 

(Note: The actual link is in plain gray text, not highlighted). 

Screenshot of dashboard in my logged-in wallet settings at Blockchain.info

Clicking on the link ("+ Import Bitcoin Address") brought up a pop-up box with a white field to enter an address, but it did not actually say which address to enter. They suggest that only advanced users do imports. I almost made the mistake of entering my Private Key here, but intuited that, as I was importing a wallet, not yet spending funds, I should enter my PUBLIC key here. So I did:

Screenshot: Blockchain.info's pop-up box for inputting a public key
in order to import an existing wallet from elsewhere.

 The text message in the pop-up above is the "advanced user" warning:

My guess, to input the PUBLIC key, turned out to be correct. Success! My wallet, that had previously existed on a printed piece of paper, now appeared as a link on the Blockchain site, and my USD balance appeared on the dashboard. I don't recall if this was immediate--I think it was. Of course, I had kept a copy of my private key so I could later spend my coins. Now I felt "safe." The first step in my paper-to-web transfer was complete.

Afterwards, I could have played around with my balance, sending small amounts of bitcoin here and there (biting the bullet on fees). But I had a specific purpose in mind for my coin. I wanted to exchange some of it for some lesser cryptocurrencies, in hopes that they will one day be "big."

I next used the "Send" Button. The next steps were pretty familiar to me--not unlike Coinbase, except that this was the first time I'd had to enter my own private key. The process for doing this is pretty straightforward. For the recipient address, I entered an existing Public Key. The field for the corresponding private key was clearly marked. A pop-up then asked for the pin that I had created when I first created my paper wallet. I had to do some subtraction (subtracting the stated fee) to determine how much I could send. It gave me a summary, to make sure of everything before I sent it.

For my second transaction, I wanted to use my total balance. Interestingly, Blockchain tried to double the fee, here, to $11. I was shocked, but then realized that I could customize the fee. I changed the fee to about $5-$6 (it wouldn't let me do less). I subtracted the fee from my total balance, and sent the difference. That emptied my wallet. My dashboard showed a $0 balance. Success!

Elsewhere on my dashboard, I could see the pending transactions and confirmations. My transactions remained pending for a very short while before being confirmed and showing up in my other wallets. I immediately exchanged some of my Bitcoin for Ripple. Maybe not a wise decision, if Ripple flops. But I've done something new and exciting, for a fearful newbie. That makes me very happy.

A little byword: none of this is anonymous. All these companies now have my "real" email address, one or more of them have my full name and street address, and one of them (Coinbase) has just about everything about me, including my bank-account routing info. The only way to get hold of Bitcoin anonymously, besides mining, would be to find another Bitcoin user and make a trade, person-to-person, wallet-to-wallet, without ever going on-line. Likewise, you'd then have to make any Bitcoin-to-fiat exchanges in person or through LocalBitcoins, or something like that. It all sounds rather back alley. However, I have sent a small amount of Bitcoin from my Coinbase and Jaxx wallets to another person's Jaxx wallet. Still, my original Bitcoin buy was on Coinbase, so it's all traceable. But, if I'd made my first buy in person, I guess it would be untraceable, if that's a big concern.

I wouldn't advise using paper for anyone who isn't trying to protect huge sums, or wanting to keep them for a long, long time -- or maybe wanting to physically transfer paper, as a chunk of "cash," to someone else. Some of the tutorials tell you to do a lot of paper wallets loaded with small amounts, for the purpose of experimenting. For every wallet you load (paper or otherwise), you may have to pay a fee to Coinbase, or Jaxx, or Blockchain, or an individual seller, or whatever you're using to send it. You may end up paying a $5-$15 fee to send, say, $5, $10, $20. Some of the exchanges or currencies set a minimum amount or a reserve to keep you from sending small amounts. Getting funds from paper wallets onto the exchanges is tricky, especially since exchanges may change the rules or update their interfaces so that you can't figure out how to use them. The idea of paper wallets is attractive to me, but the actuality of using them, outside of experimenting, is a little scary.

Another thought: --about $5 per transaction (on relatively small amounts). I don't know where I got the impression that Blockchain's fees were reasonable. Still, I'm sure these companies, like me, are still learning. With the price of servers, electricity, customer service, lawyers, et al, they must inevitably raise their fees. And if fees are high now, what might they be in the future? Hmmm, maybe those good old fiat-bank fees don't seem so insane now. I mean, I could spend $25 or $5,000 greenbacks any old day (if I had that much) without paying any fee at all...

Crypto-Newbie

I'm no expert, just a pathetic newbie, trying to navigate the muddy, gator-infested stream of Cryptocurrency. In the beginning, I read and read, created several wallets, watched 10,000 ads and answered ten or twelve surveys in order to collect five or ten cents worth of "coin" from some then-functioning faucet, deposited it to a wallet, and felt rather proud of myself. I read a lot more, finally decided that a $50 gamble wouldn't kill me; and, deciding that Coinbase was newbie safe (in spite of the so-called high fees and lack of anonymity), I not the bullet and opened an account. Signing up was easy, and I quickly linked my checking account, waited the agonizing week or so, and made my first official Bitcoin purchase. Need I tell you how excitedly I watched the daily, nay, even hourly, rate changes? Finally, I let it lie for a year or so, checking occasionally.

Then Coinbase required Authy for 2FA. Fine, I signed up for Authy. I was still using a landline at that time, but it all worked.

My first big snafu came when Coinbase decided that landlines would no longer work for 2FA. Fine, I switched to cell for SMS notifications--not my first choice, but it had to be.

Not long after, Coinbase decided SMS was not secure. Fine, I switched to Authy, but Authy was somehow connected with my landline.

I did something in the wrong order, and was unable to log into my Coinbase account, while I wrangled with Authy and Coinbase Customer-Service reps to get my 2FA/phone-verification mess straightened out. Authy reps were human. Coinbase used bots. Authy got it fixed, though I whipped them a couple of sharp opinions during the process. But I'm back in my Coinbase account, though I don't dare change my phone number or email, for fear of the same mess.

Terribly spooked, I withdrew almost all my currency, exchanging to good old US dollars and putting it safely into my checking account. I also let Authy know that tech companies which handle people's mony and bank accounts should offer alternate identity-verification choices, including traditional ones, such as Notary Public oaths. I left a few bucks in Coinbase, 'cause, what the hell... a five-buck lotto ticket, etcetera. I patted myself on the back for having made a few bucks, and still having a few spare bucks invested.

Barely a month later, Authy app began to return a phishing alert when I select my Coinbase account. Smart-Aleck techies on forums blasted Authy and suggested switching to Google Authentication, but I didn't dare make a change for fear of being locked out of Coinbase and/or Authy.

I investigated the various exchanges all the crypto-wiseguys were raving about, but found problems with each one: one wouldn't accept US residents, one was too complicated, one wouldn't allow small trades (a requirement of mine, since I want to use smallish amounts when testing new wallets on new exchanges). So, I stuck with Coinbase, while ogling other exchanges with envy.

Bitcoin had flatlined at about $800-$900, and got so boring, I didn't even check Coinbase for ages. Then one day I saw a news article, checked my account, and was pleasantly surprised. Over the next few weeks I watched the NYC rate climb to $3,000 per coin. I suspected a bubble, but knew it could shoot even higher. I thought it would, "eventually," but I thought it would probably crash first and stagger along for a few years before rising. I saw that some "experts" agreed with me, so again, I converted most to cash. Alas, I had spooked too soon. Bitcoin climbed to $12,000. I bought more at a loss (regretting that I could've been a few thousand dollars richer had I waited a month to sell).

I'd also had to agonize for over a week while my cash travelled from bank to Coinbase. I wanted to make instant buys. My next big snafu came when I tried to add a credit card to Coinbase. It will not verify. Seems Coinbase makes two little deposits, but Visa combines the amounts to one. Coinbase won't verify with the combined amount, and Visa statement will not show the separate amounts. Visa CS blames Coinbase; Coinbase CS blames Visa, and my card won't verify. (My driver's license won't verify, either. Coinbase's verification process is a muddled mess, and Customer Service the re is practically non-existent). Keep in mind, I've lived in one place for about 30 years, had the same solid, stationary, highly traceable landline, had the same bank account, and been (at one time) a Notary Public. And I can't get verified by a damned little start-up that has existed for less time than our current stash of toilet paper. Well, maybe a bit longer than that, but... Do you see the problem here?

All that aside...

Except for the phishing alerts, all had become fairly stable, I'd made decent little profits, and I decided that I probably shouldn't be linking a credit card anyway (being an impulse buyer and a semi-poor person). Besides, I now learned, I could place some money in a Coinbase USD wallet and make instant buys that way. So I did.

I made another small deposit into Coinbase, waited till prices were down a bit (though higher than before the failed-verification snafu). I even ventured into other coin: Litecoin and Ethereum. I experimented with creating paper wallets and third-party app wallets, and sent a bit of coin to them. I gave a tiny amount of Bitcoin to my niece, so she could study crypto. The $2-$5 fees, I put down to the learning curve: a reasonable cost for real-time experimentation and learning, and a lot cheaper than that $400 Crypto Cash Crash Course I saw advertised localky; man, that guy will be able to buy some major crypto, if he has many takers.

Coinbase announced that it wouldn't support the upcoming Bitcoin Cash fork. I barely understood that, and from the few articles I read on BCH, I wasn't impressed; so I did nothing. Come the divide, nothing changed. I was fine. Later, I was pleasantly surprised when Coinbase agreed to support BCH technology, opened me a wallet, and gave me $30 or $40 USD worth of coin. But that got me to thinking (how I could've missed out), so I read up on forks. So, I moved most of my Bitcoin to a paper wallet.

Now, keep in mind, I'm dealing with amounts of coin so small, I see snarky wiseguys on Reddit snickering about such newbie trades, the same way a guy will snicker over another guy's tiny little penis. So I don't post on forums, I just read 'em.

I wanted to buy something new and cheap, but Coinbase only offers a few coin types. I'd failed to find another exchange that worked for me. Then I found Bitsane. Bitsane won't sell to US clients for fiat currency, but will allow crypto-coin exchanges.

I opened an account. I struggled with the interface, but managed to open a Litecoin wallet.

I would try to choose LTE to Ripple, but every time, Bitsane would switch it back. I thought I probably needed to open a wallet and deposit some coin first--a fearful thing, since I couldn't seem to make the exchange work. But I reminds myself, All my existing coin is still from that original dividend, and it's subsequent growth, plus the "fork" bonus. Found money, to me!

So, I opened an LTC wallet, went to Coinbase, and sent a little Litecoin. Coinbase's app kept "sending" forever, so I finally closed it, speculating on three possible outcomes: Twilight Zone (lost Litecoin); failed transaction (refunded Litecoin); or successful transaction. Bitsane still showed empty wallets, but Coinbase, once reopened, showed a pending transaction, with two confirmations; so I guessed the Litecoin would soon appear in my Bitsane wallet, and it did.

Now Bitsane showed a loaded LTE wallet. Now I opened an XRP wallet, and attempted to make a trade. Bitsane still switched the exchange buttons. It looked backward to me, with "Buy" (LTC) on the left side (blue button), and "Sell" (XRP) on the right side (gold button). But in between was a non-descript little text "XRP," with a field to enter amounts. I inquired that I should put my LTE amount in the box and hit "Buy." I'm dealing small amounts on both sides of the coin, so if I did it backward, it would either fail, or I' s lose, maybe $20-$30 bucks to misplaced coin and exchange fees.

Now, if you know crypto and are good at exchanging them, you'll laugh at me for what I did next. Some digital amounts were underneath the "Buy" and "Sell" buttons. I'm used to the Easy Button on Coinbase, where I enter a very familiar USD amount and buy how ever much coin I can get for the fiat amount I know I'm spending (less fees, of course). So, these fractional amounts in decimal form on the Bitsane buttons were Greek to me. So I just copied the amount from the LTC side into the middle box for XRP -- something like 0.1455 -- and I hit the blue LTC "Buy" button. Lo and behold, it went through!

I immediately checked my wallets. I now had some LTC and someXRP, so I was a semi-happy camper, but with no idea how much of either coin I owned. I closed Bitsane and used a coin converter, but was still unsure. So I went back to Bitsane, deciding to spend the rest of my Litecoin. I followed the same process, but this time, it failed. The middle box said "Minimal Amount 5." I'm looking at the LTC box, and I don't have "5." I don't even have a whole number, just a fraction of coin, a 0.009-something. And oddly, the XRP yellow button shows a similar figure. I have no idea what I have or what to do.

So, I tried random figures in the middle (currency/XRP) field. I put "1" and both buttons showed a change of figures. But underneath them, both sides showed the same figure, something like 13 or 19, and I don't recall of the decimal was before or after. (I'm now guessing that figure tells me it's a one-to-one unit exchange--but I don't know if that's what it means).

So then I tried "5," and the corresponding amounts on the buttons still looked miniscule. So I tried a whopping 4500, and hit "Buy," and it quickly said, "You don't have enough--want to make a depisit?" (paraphrasing).

So now I thought I had some idea, that I could probably buy maybe 10-20 Ripple for the amount of Litecoin I was willing to spend on an experiment. I went back to the wallets, memorized the decimal amounts, went to the converter, figured out the Litecoin I had left in that one wallet, and went back to the exchange. I entered a whole-dollar amount (between 10-20) in the XRP currency field, and hit the blue "Buy" button, and it worked. I now had approximately the desired amounts in both wallets. I didn't try to calculate my remaining Lifeline to the penny, knowing it'll come and go with the market, anyway.

Now, it's my bad that I probably spent $10-$20 (or who knows how much) in fees to exchange less than $50 of Litecoin for some Ripple, and some will call it a fool's errand to trade "good" Litecoin for "bad"(or iffy) Ripple, but I'm proud to be the first of my personal acquaintances to own Bitcoin and Ethereum and Litecoin and Ripple (albeit in laughably small amounts, at current rates); and to have purchased them on two different exchanges, one of which is most definitely not for us newbies!

And all this, I did at a small profit, considering the amounts of my initial fiat deposits and withdrawals. Yes, any expert could have done twice as much with less than half the fees...

But I'm no expert.

First published on Little Scraps of Paper, my catchall blog for reminders. Moved here, as best fitting the stone age to technology age theme...