Bitfinex Exchange, Blog, Coinlend, Lending

How to Automatically Lend your Bitcoin

December 10, 2017 flippener 2 Comments

Having put your Bitcoin on a trading exchange like Bitfinex we can set it to lend out the Bitcoin for interest. Rates of interest vary widely between exchanges and coins, and over time. However, they can be surprisingly generous – for example you can currently lend Bitcoin on Bitfinex at an annual rate of up to 40%.

Cryptocurrency lending, however, is typically over short durations – for example a non-compound annual rate of 36.5% really means a rate of 0.1% per day for a certain number of days. In fact crypto loans are typically quoted as being for a minimum of 2 days and in my experience nearly always last exactly 2 days.

That could make things very inconvenient if every 2 days you had to start another loan manually. However, there are bots that you can do this for you – I always use CoinLend and I highly recommend it. Not only does it work really well – it’s an online bot with nothing to install – but it’s completely free!

Start by going to CoinLend.org and creating a new account by selecting Setup Bot. Enter your email address and a password and selecting Register. Then login.

You will be taken to the Bots screen where you can set up bots for three different exchanges: Poloniex, Bitfinex and Quoine. Bitfinex seems to consistently give the best interest rates so that’s the one we’ll use.

Go to your Bitfinex account and login. Then select the Manage Account (a head-and-shoulders icon) in the top right of the screen, then API. An Application Program Interface (API) is a software call that allows a third party program – our bot – to communicate with the Bitfinex exchange directly without us needing to be involved.

Click on Create New Key. Make sure the following permissions are ticked and no others:

Read: Account History, Margin Funding and Wallets.
Write: Margin Funding.

Make doubly sure that Write permission is off for Withdraw so that this API cannot be used (by Coinlend or some other party) to withdraw your funds. Enter a name at Label Your API Key such as Coinlend lending key. Select Generate API Key. Check your email and confirm creation of the new key.

Your new API Key, and a secret key to access it, will now be shown in Bitfinex – copy both of these somewhere safe to record them.

Bitfinex API screen with keys (Image: BIUK)

Copy both keys into the Bitfinex Bot section of the Coinlend Bots tab and click Save. If you’ve done this correctly you will get a confirmation message, it will display Bitfinex credentials valid, and the button will go green and say On.

Coinlend Bot screen - Bitfinex On (Image: BIUK) — Coinlend Bot screen – Bitfinex On (Image: BIUK)

Coinlend will generally start working very quickly, almost immediately. To see your loans underway just switch to the Loans tab and wait a minute or two – here it’s showing our first loan has gone out, and it’s at 16.62% (the display defaults to annual, compounded interest):

You can also confirm your loan status by going to Bitfinex and selecting Funding -> Bitcoin. Your active loans will be shown under the PROVIDED pane – click the drop-down icon to open. The interest rate shown in Bitfinex is the daily one – so here it’s 0.04214 per day.

If you want the interest rate shown in Coinlend to be the same then you can change this on the Settings tab – the options are Daily, Yearly, Compounded.

Tip: If you think you might want quick access to your Bitcoin then in Coinlend in the Bots/Bitfinex Bot tab under the On/Off button select Settings -> BTC – Extended and switch on the option for Always lend at the minimum duration of 2 days, and then Save Settings. This setting doesn’t always ‘stick’ so check it by going back into Settings and repeat if necessary – once it has set successfully the Extended button will show orange.

And that’s it done – the Coinlend bot will keep lending out your Bitcoin until you set the Bitfinex bot to Off on the Bots tab. Your Bitcoin stake will grow, and all for free.

Bitcoin (BTC), Bitfinex Exchange, Blog, Lending, Trading

How to Put Your Bitcoin on a Trading Exchange

December 9, 2017 flippener 3 Comments

Once you’ve got some Bitcoin what can you do to make it grow? The obvious answer is to put it on a Trading Exchange. Then you have the options of Trading, Margin Trading and Lending. These will be covered in more detail later; here we’ll look at the process of getting your Bitcoin onto an exchange.

The five biggest exchanges by trading volume are Bitfinex, Bithumb, Bittrex, GDAX and Poloniex, in that order. Here we’ll use Bitfinex.

Go to Bitfinex.com and click on Sign Up. Enter your chosen Username and Email address. Enter a strong password, e.g. from Passwords Generator. Set the Timezone (e.g. to (GMT+00:00) London). This will create you a new account.

Find the email you’ll be sent and verify your email address. Login at Bitfinex.com. You will start in the Trading screen, likely showing a Bitcoin – Dollar chart (‘BTC/USD’).

Bitfinex Trading View - Dark theme (Image: BIUK) — Bitfinex Trading View – Dark theme (Image: BIUK)

By default it will be dark. If you prefer a lighter colour scheme go to the top right user icon and select Interface, then Theme and choose Light.

Bitfinex Trading View - Light theme (Image: BIUK) — Bitfinex Trading View – Light theme (Image: BIUK)

To transfer some Bitcoin from your Electrum wallet into Bitfinex select Deposit -> Bitcoin. You may then get a warning about there being a fee on small deposits (less than $1000) that you need to acknowledge.

On the New Deposit screen select Bitcoin. You may then get advice to set up two-factor authentication (e.g. using your mobile phone to confirm withdrawals) – it’s a good idea but for simplicity we will ignore it at this point. You will see options for Exchange Wallet (for trading), Margin Wallet (for trading with leverage) and Funding Wallet (for lending). Under Funding Wallet select Click to generate address. This will create you a Bitcoin address where you can send funds; click on the Copy to Clipboard icon next to it.

Sending from an Electrum Wallet

Log into your Electrum Wallet and select the Send tab; paste in the Bitfinex address. Add an optional Description (e.g. Transfer to Bitfinex). Enter the amount of Bitcoin to transfer (or press Max if you intend all of it).

If you hover over the Fee slider you can see what the mining fee will be – moving the slider to the right will speed up the transaction and increase the fee – this can usually be left at the default. Press Send, re-enter your password to confirm. You will see a brief message about signing and then Payment Sent.

Select the History tab and you will see the transaction there. Once it has been confirmed (which may take from minutes to hours depending on how busy the network is) it will show here with a green tick.

In Bitfinex select Deposit and once confirmed the deposit transaction will also show here. Initially it will be marked Unconfirmed.

Bitfinex Deposit screen - transaction unconfirmed (Image: BIUK) — Bitfinex Deposit screen – transaction unconfirmed (Image: BIUK)

Once confirmed it will show as Completed, and the new balance will also show under Funding in the Balances area of the sidebar.

Bitfinex Deposit screen - transaction confirmed (Image: BIUK) — Bitfinex Deposit screen – transaction confirmed (Image: BIUK)

Your Bitcoin is now on the Bitfinex exchange ready for trading or lending.

Bitcoin (BTC), Opinion

Stop Dwelling on Your “I Should Have” Bitcoin Anxiety

December 8, 2017 flippener

So let’s get this straight: you should be a bitcoin millionaire right now only you’re not

because you a) sold too soon b) bought too late c) disregarded your mate’s advice d) lost your hard drive e) went all in on feathercoin. Welcome to the club. You’re not alone, but that knowledge will come as little comfort when you’re lying awake at night cursing your stupidity. We can’t turn back time, but we can dispense some sound advice that should help put your hard luck story in perspective.

Missed the Boat and Skipped the Party

If you’re late to the bitcoin party – or worse still, if you left before the party got truly started – the regret can be crippling. Every new all-time high drives another dagger into your stricken heart, while the sight of young bucks who’ve never read Satoshi’s white paper drunk on bull market gains is sickening. At least one story has surfaced of an early adopter spiraling into depression after losing all their bitcoins and eventually committing suicide.

But this is meant to be an uplifting piece, not a morbid one. Thankfully, most people who missed the boat suffer nothing worse than a bad case of hindsight. If that’s you, stop beating yourself up. There are three reasons to be cheerful, but before we consider them, let’s consider the psychology of luck.

Queuing Theory Said This Would Happen

You’re shopping for groceries and pick the queue that looks fastest. To your chagrin, the one next to you turns out to be quicker, leaving you waiting in line behind the old lady clutching over 9,000 coupon codes. Sound familiar? There’s a simple reason why, statistically, you’re more likely to pick the slowest queue: with a queue on either side, the odds of calling it correctly are just one in three.

What’s that got to do with cryptocurrency? Well, if you bought bitcoin in 2013, for example, the odds of having hodled till now are much lower than one in three. In fact they’re more like 1 in 20. When you see bitcoin whales screenshotting their phat portfolios, it’s easy to assume that this is the norm; that everyone else is getting served fast in the store but you. The reality is that most people are in the same boat as you – one which is several lengths behind the boat they’d rather be in.

Bitcoin breaks through the $16,000 mark

December 7, 2017 flippener

Bitcoin has breached the $16,000 mark, extending the digital currency’s record-breaking surge.

The cryptocurrency began the year below $1,000 but continues to rise despite warnings of a dangerous bubble.

According to Coindesk.com, Bitcoin reached $16,663.18 (£12, 358.35), having soared over 50% in a week.

The new high comes days before the launch of Bitcoin futures on two exchanges, including the world’s largest futures exchange, CME.

Spread betting firm CMC Markets said the rise had all the symptoms of a bubble market, warning “there is no way to know when the bubble will burst”.

Don’t fall for the hype?—?Why Bitcoin’s $10,000 Price Doesn’t Reflect Its True Value

December 6, 2017 flippener

Here are some examples of financial news headlines from the last few days:

Bitcoin finally hits $10,000!?—?The Economist, Nov. 28th, 2017

Bitcoin surpasses the $10,000 milestone!?—?CNBC, Nov. 28th, 2017

BITCOIN SOARS ABOVE $11,000!?—?The Guardian, Nov. 29th, 2017

News outlets haven’t even had 24 hours to let the “10K” news simmer and it already climbed to $11,500. By the time they published the “11K” piece, it already dropped back to $9,000. Then, as soon as they entered the last word on their “Bitcoin is crashing!” article, it’s back at $11,000 per BTC.

Amazing! But this is not unprecedented.

We’ve seen this before, back in 2013, a media frenzy when Bitcoin was approaching $1,000 that fueled that year’s bubble. In January of that year, one bitcoin was trading at around $15.00, rocketed to $266 by April, and then crashed back to $50 really quick. By November, it had already broken $1,000, peaking at $1,242 on Mt.Gox. That’s an almost 100-fold increase in 11 months, an order of magnitude larger than this year’s (2017) 10-fold run up.

Funny thing is, the charts then are almost identical to the ones today, and news articles look exactly the same. Just add one zero.

The media gobbles this up because people are fascinated by this stuff. Stories of people finding 5000 BTC in an old hard drive that they bought for $25 in 2009, a man throwing away 7500 BTC by accident and scouring a landfill to try and find it, a man buying pizzas for 10,000 BTC?—?It’s the sizzle to the steak and it sells.

The Other Side

People love it when things go up, but what goes up must come down, and Bitcoin is not immune to this. History shows three major “Bitcoin Bubbles”, and a LOT of volatility in between. Swings of 20–30% in one day are not uncommon in the Bitcoin world, but to most people this can be quite terrifying. For example, in the same day when Bitcoin broke $11,500 a couple of days ago, Bitcoin crashed back to $9,600, and lost 20% of its value overnight.

It isn’t just that, there are more. There’s that time it crashed from $260 to $50. Bitcoin was declared dead.

My $200,000 bitcoin odyssey

December 5, 2017 flippener

This was not what I expected to be doing with my October. But there I was, on a flight to Hong Kong, hoping I would be able to retrieve $200,000 worth of bitcoin from a broken laptop.

Four years ago, I was living in Hong Kong when a fellow journalist named Mike and I decided to invest in bitcoin. I bought four while Mike went in for 40; I spent about $2,000 while he put in $15,000. At the time, it seemed super speculative, but over the years, bitcoin surged and Mike seemed downright prescient. I had since relocated to Los Angeles and had been texting Mike about the 2,000 percent rise in our investment.

Strangely, I wasn’t getting much of a response from him. He had 10 times as many bitcoins as I did — shouldn’t he at least have been excited? Finally, when the price of one bitcoin broke $4,000 this summer, I sent him this message: “You do still have those bitcoins right?” That’s when he broke it to me: “Maybe not …”

Here’s what happened: At some point in 2013, Mike had rightfully become concerned about security. He initially kept his coins in an exchange called LocalBitcoins. Exchanges are commonly used to buy and sell cryptocurrency, but you shouldn’t keep your coins there. The most infamous bitcoin scandal to date was when Mt. Gox, an exchange based in Japan, lost 850,000 of its users’ bitcoins.

Exchanges can also suddenly close, as some did in China this year when the Chinese government suddenly made them illegal. Any serious cryptocurrency investor will tell you that your coins are best kept in “cold storage” (an offline hardware wallet). That’s what I’d done with mine, but Mike hadn’t gone that far three years ago when he started thinking about security. Instead, he set up a software wallet. It was a good step, but he would soon learn, it was not foolproof.

What the Fork? 3 Bitcoin Hard Forks Scheduled for December, More to Come

December 4, 2017 flippener

Super Bitcoin, Bitcoin Platinum, Bitcoin Uranium, Bitcoin Cash Plus, and Bitcoin Silver could threaten the Bitcoin ecosystem.

As Bitcoin continues its rapid journey to unprecedented heights, the plot thickens: at least three Bitcoin forks have been scheduled for the month of December, with more to follow in January, February, and March of 2018. Bitcoinist questioned if the sudden rash of Bitcoin forks was “the dawn of the ‘initial fork offering’”.

Bitcoin Fork Pens (Image: BTC Keychain/Flickr)

Super Bitcoin, Bitcoin Cash Plus, Bitcoin Silver, Bitcoin Platinum, and Bitcoin Uranium (which has the quaint ticker symbol ‘BUM’) are all on the menu. Each of these coins claims in its own way to solve the issues of scalability and centralization that have plagued the Bitcoin network, although none of them really seem to have proven that they have the technological basis to do so.

For example, Bitcoin Silver (BTCS), which claims to be making “cryptocurrency accessible to the rest of the world”, claims to have an “incredible team consisting of financial experts, blockchain developers, telecommunication influencers, international law experts, and local business ventures” that are based all over the world. However, none of the identities of any of these supposed team members are anywhere to be found.

Will the bitcoin bubble burst?

December 3, 2017 flippener

A pillar analysis of the market shows a promising future for cryptocurrency, despite the naysayers.

One of the biggest hurdles bitcoin has faced throughout 2017 has been poor journalism around the cryptocurrency, along with uneducated opinions from many so-called “experts” within the financial industry.

Jamie Dimon famously labelled the currency a “fraud” suitable for murders and drug dealers, while the chief economic advisor of Allianz said in September it should be worth half of what it was trading at back in September when it was edging US$5,000. I wrote about this in my last article when the price fell back to US$3,600.

Peter Switzer, a prominent and well respected financial commentator, was asked for his thoughts on the cryptocurrency around the same time in September. However in a more honest approach he advised he had chosen not to invest stating “I subscribe to the view that I don’t invest in things that I don’t understand”, further quoting Charlie Aitken’s reference to bitcoin being a “bubble”.

Bitcoin price chart (Image: geralt/Pixabay)

The real negligence here has come into play, as there have been few signs that many of the most prominent financial commentators actually understand the cryptocurrency. Myopia has hit many individuals we have historically trusted to understand financial markets.

Despite the numerous comparisons, the cryptocurrency boom displays very few characteristics to Tulip Mania outside of a huge price spike. Many more similarities are found in comparison to the oil rush in the 1850’s, which was actually the largest wealth transfer of this magnitude prior to the evolution of cryptocurrency. Those involved in it simply understood that the world was moving away from the horse and cart, and into a realm where oil would become an essential pillar of the economy. In the same way, currencies are changing and they are about to have a profound impact on everyday life.

It’s time those around the financial industry, especially those giving financial advice and opinion, actually understood the currency, and what its technology really means for the future of currencies.

Cash, Gold, 2X?—?What the fork!

December 2, 2017 flippener

Repost from HackerNoon

After all, what was going on with Bitcoin in the last few months?

It looks like, in the last few months, Bitcoin has made friends with forking. When I wrote about Bitcoin forking the last time, I didn’t expect there would be this many so soon. But hey, here we are, trying to make sense of what the hell is happening in the crypto world.

Bitcoin fork pen and bitcoin keychains (Image: BTC Keychain/Flickr)

With this article, I try to put everything that has happened since Bitcoin Cash in a proper order that would become anyone’s go-to article for learning about Bitcoin forks between August 2017 and November 2017.

🍴 But first, what is a fork?

“You don’t need a silver fork to eat good food.”?—?Paul Prudhomme

You can think of blockchain ledger as a stack of pages. Every full node in the network keep a copy of this stack of pages with themselves. Everyone’s copy of the ledger is exactly the same because everyone followed the same set of rules to build it.

So, if there are ten people in the network, each of them will have a copy of the ledger that would look something like this:

A Beginner’s Guide to Cryptocoin Mining

December 1, 2017 flippener

Is it worth your time to mine for cryptocoins?

Mining cryptocoins is an arms race that rewards early adopters. You might have heard of Bitcoin, the first decentralized cryptocurrency that was released in early 2009. Similar digital currencies have crept into the worldwide market since then, including a spin-off from Bitcoin called Bitcoin Cash. You can get in on the cryptocurrency rush if you take the time to learn the basics properly.

Which Alt-Coins Should Be Mined?

If you had started mining Bitcoins back in 2009, you could have earned thousands of dollars by now.

At the same time, there are plenty of ways you could have lost money, too. Bitcoins are not a good choice for beginning miners who work on a small scale. The current up-front investment and maintenance costs, not to mention the sheer mathematical difficulty of the process, just doesn’t make it profitable for consumer-level hardware. Now, Bitcoin mining is reserved for large-scale operations only.

Litecoins, Dogecoins, and Feathercoins, on the other hand, are three Scrypt-based cryptocurrencies that are the best cost-benefit for beginners. At the current value of Litecoin, a person might earn anywhere from 50 cents to 10 dollars per day using consumer level mining hardware.

Dogecoins and Feathercoins would yield slightly less profit with the same mining hardware but are becoming more popular daily. Peercoins, too, can also be a reasonably decent return on your investment of time and energy.

As more people join the cryptocoin rush, your choice could get more difficult to mine because more expensive hardware will be required to to discover coins. You will be forced to either invest heavily if you want to stay mining that coin, or you will want to take your earnings and switch to an easier cryptocoin.

Bitcoin Investors UK

Monthly Archives: December 2017