Last updated on January 23rd, 2017 at 10:54 am
Many people who just hear about Bitcoin ask “well how do you actually use it?”. That’s a tough question to answer, since Bitcoin is just like “normal” money. So imagine if I were to ask you “How do I use dollars?” However, since a lot of the people who come to this site are new to Bitcoin I decided to write a quick start guide on how to use Bitcoin, so here goes.
Before you can use Bitcoin you need to get a Bitcoin wallet
The first thing you’re going to need to do in order to use Bitcoin is to get a Bitcoin wallet. There are a lot Bitcoin wallets you can choose from, but if you’re just starting out I would suggest using one of the more user friendly wallets (i.e. Coinbase or Blockchain.info).
Just like you need some sort of software to send and receive emails (e.g. Gmail, Outlook), you need a Bitcoin wallet to be able to use Bitcoin. A Bitcoin wallet is a piece of software that allows you to send and receive Bitcoins. One of the things the Bitcoin wallet will provide you with is your Bitcoin address.
A Bitcoin address is what you give to people who want to send you Bitcoins (just like you’d give an email address to someone who wants to send you an email). However, Bitcoin addresses are a bit more complicated than email address – they look like random numbers and letters and start with “1” or “3”. Here’s an example of such an address: 1GrwYYTDJic27cstVCjzS8Muvutw6JUYqB
Now let’s get some Bitcoins
Once you have your Bitcoin wallet and your Bitcoin address all you are missing are some Bitcoins. There are many ways you can buy Bitcoin today. Depending on the payment method you’d like to use and the Bitcoin exchange you choose the cost will vary. Remember that you can also buy less than one Bitcoin if buying a full Bitcoin is too expensive for you.
If you use reversible payment methods (i.e. buy BItcoins with a credit card, Paypal, etc) you’ll usually pay much more in fees than if you use irreversible methods (i.e. wire transfer) due to the risk you pose to the seller.
Once you have your Bitcoins you can start using them.
How to actually use Bitcoin?
Well, in the past few years more and more companies have started accepting Bitcoins. Overstock, OK Cupid, Virgin Galactic, Microsoft and Subway are just some of the companies you can use Bitcoin to pay for their services. Also, if you want to use Bitcoin to buy virtually anything you can apply for a Bitcoin debit card.
These debit cards are issued by 3rd party companies that take a fee for their service. With a Bitcoin debit card you can buy at any store that accepts debit cards and the amount will be deducted from your Bitcoin balance.
If you don’t want to buy anything you can invest your Bitcoins in various ways such as holding on to them, trading them or getting mining equipment. Keep in mind that most Bitcoin investments are very risky and you should educate yourself about this matter before investing your money.
Another way to use Bitcoin is by sending money to your friends or family. All you need to do is get their Bitcoin address and you can transfer Bitcoins from your wallet to theirs. A use case for this can be paying back a friend who bought you dinner, returning a loan or even settling a bet.
Finally, if you want to open an online business you can also use Bitcoin as a payment method so that customers will have additional ways of paying you.
So now you know the basics of how to use Bitcoin, I encourage you to use any of the links in this article to read more about the different ways described here. If you still have any questions feel free to post them in the comment section below.