Bitcoin Step by Step

The Best Way to Get Started

So You Want a Bitcoin?

IMPORTANT NOTE

This is no longer a viable method in the US.  I would recommend Coin Base.  I have other blog posting on using Coin Base.

I’m leaving the posting here, in the event that someone one outside the US finds it useful to use MT Gox.  Bit Instant is no longer around.

Additional update, MT Gox is now offline as it should be.  Even if MT Gox comes back online I cannot recommend it as a viable method.  I’ll leave this blog up, but it is essentially useless.

Overview

Bitcoin is all over the news lately and it’s the hottest virtual currency.  You know all that, but all you want to do is get your first Bitcoin.  Well I’ll cut to the chase and show you step by step how to get there.  I’ll describe how to convert real US Dollars (Other currency’s work to but the exchange sites are slightly different) into a Bitcoin.  This blog entry will teach you how to get a Bitcoin.  If you want to learn more about how to secure it, where to store it, how can you use it or how to get it back to cash, all that and more is explained in my Book Bitcoin Step by Step.

Step 1:  Sign Up for An Account

https://mtgox.com/signup

image021

Once you are signed up, you’ll be asked to go through a verification process.  You should consider doing this.  However, if you will not be moving more than $1,000 USD / day and $10,000 USD /month, you do not need to be verified.

Step 2:  Fund Your Account

From the Home Page, Select “Funding Options”.

To get money into the account, you can do a bank transfer, which is best for large amounts.  If you have cash and want to get it into the system fast, the following is one way to do it.  We’ll only be moving a small amount so we’ll use BitInstant.

Step 3: Determine How Much We Need

When you log in you are taken to the Trade Screen and the Buy tab.  On this form there is a price entered in the Box Price per coin in USD.  This is how much 1 Bitcoin (BTC) cost at the moment.  It will change prior to your purchase.  So we may get a little more or a little less than a full BTC.  That’s ok.

Add 3.99% $3.95 to this amount and that’s what you will need in cash. So if you plan to spend $100 you’ll need:

$100 + $3.99 + $3.95 = $107.94

Step 4: A Cash Deposit through BitInstant

Before going to the BitInstant site, it is important to note your account number from MtGox.  It can be found at the top of the web page in the center.  It will say “Account Number” next to it.  You will need that number to ensure you will receive the money.

Go to the site:  https://www.bitinstant.com/

image025

Select “MoneyGram” in the Pay From drop down menu and “MtGox” in the Pay To drop down menu.  You can experiment with other options.  Look to see if there are CVS or 7/11 stores that support transactions in your area.  Near me, only MoneyGrams are supported.  I can go to Wal-Mart and have it funded.

In the account box, place your MtGox account number.

In the Amount place $100

Enter the amount to send and notification email.

When you do, you will be taken through a series of screens where you will verify additional information.  I cannot finish the process to get the screen shots.  If I do, I will have an outstanding money order.  So there are no screen shots for this.  When you do this, you will end up at a ZipZap site where you can enter your phone number and search for a location to send the MoneyGram.

Once you’re done entering your information, select “Create Payment Slip” at the bottom of the screen.

Print this out and take it to the location you chose.  I’ll continue with the example assuming you picked Wal-Mart.  At Wal-Mart, there is a Money Center generally in the front of the store.  Go there, grab a blue MoneyGram form and fill in the information.  The slip you printed out will have the information you need to properly fill it out.

Pay the clerk the money.  Drive, walk, take a cab, bus or train home.  Within 30 to 60 minutes, your MtGox account will be funded.

The fees on this are a little bit less:

  • 3.99% = $3.99 on $100
  • $3.95 MoneyGram

Step 5:  Buying Bitcoins

If you recall from the Exchange section, you can place a market order to tell the system how much USD you want to spend, and you’ll spend that much money and receive the number of BTC based on current BTC for sale.   Alternatively, you can enter a limit order and set the price at which you want to buy the BTC.  With a limit order, you will need to wait until someone in the marketplace decides they want to sell at the price you are asking.

image026

To enter a limit order:

  • Enter the number BTC to buy.
  • Enter the price to pay.
  • Select the “Buy Bitcoins” button.

Your open order will be displayed in the bottom section of the screen.  If you simply want to place a market order, check the “market order” check box.  Enter the number of BTC you wish to buy, and you will be told approximately how much it will cost.

There you have it! You now have Bitcoins.

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16 comments on “So You Want a Bitcoin?

  1. Bitcoin Step by Step
    February 8, 2014

    This is no longer a viable method in the US. If in the US look at http://www.coinbase.com

  2. As far as cryptocurrencies go, this one can’t be beat.
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    Several bans and employees of banks have shown an increased interest in
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  3. Korea stuff
    February 13, 2014

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    • Bitcoin Step by Step
      February 13, 2014

      In the US we have freedom of speech. So no they cannot arrest me for what I say. If I choose to do something illegal they could arrest me, but Bitcoin is not illegal.

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    April 18, 2014

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    May 15, 2014

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    May 19, 2014

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    • Bitcoin Step by Step
      May 20, 2014

      I”m glad you found this useful though it is extremely outdated. I do have more in my book.

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This entry was posted on April 11, 2013 by in Exchanges and tagged , , , , .
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