The increasing interest towards Bitcoin is fueled up by its rapid rise at the start of the year. Right now, the BTC price is yet unsure whether to beat the threshold of $100,000 that was predicted for it. And it doesn’t seem like it’s ever going to hit zero either.
Perhaps this is the time to join the ranks of bitcoin hodlers when you notice a local low. Or, if you own some already, how to use bitcoin apart from selling it for profit? Let’s go through some of the common bitcoin use cases. Regardless of your background—miner, trader, or occasional crypto enthusiast—you are going to spend the coins one way or another.
We assume that you are familiar with the basics, e.g., how to get around with the core app (the wallet), your private key and seed phrase.
How to use Bitcoin anonymously
The point of Bitcoin, first and foremost, was to exclude a central regulating body. The Bitcoin blockchain is a public ledger; it is visible to any interested party. To retain some of anonymity, experienced users suggest changing the personal wallet address. Generate a new address every time you send or receive coins.
However, in case with a Know-Your-Customer wallet that has some of your personally identifiable information linked to it, any anonymous transaction is impossible. For example, Coinbase uses such wallets. Tying up the online exchange account address with a personal cold wallet address is easy, as you can see. Say, you have some bitcoin; how to use it anonymously then?
There’s a fairly convoluted way to attempt to preserve your privacy.
- The device you intend to make a transaction from must be impossible to link to your identity. The payment data and the check prove your ownership over a particular device, so it’s advisable to use second-hand markets and pay for a brand-new device in cash.
- On top of that, if you really care how to use bitcoin anonymously, then you realize that there should be as little evidence as possible that you actually bought the said device.
- Never enter or store personal data on that device. Or anything related to your character and personality.
- Use hard drive encryption and, if possible, a tool that can erase the drive data in seconds.
- Privacy-focused software, like The Onion Router, should be of great interest for you now. Lastly, listen to what security experts have to say.
But, as we said, Bitcoin transactions can be traced and the network was never privacy-focused. All of the mentioned precautions can be in vain due to a single ridiculous slip. If you wonder how to use bitcoin anonymously, then maybe Monero (or another better encrypted coin) might be your go-to choice to conceal the real-life identity.
If you just wondered how to use bitcoin for purchases of other crypto, the answer couldn’t be any easier: set up an online exchange account, look for the available pairs, and trade right away. Mind that operations with crypto currencies are taxable in certain regions, and the tax amount will depend on the trade volumes, gains, and losses.
A Bitcoin ATM machine is hardly anonymous because of surveillance networks; besides, some of them request for ID.
Bitcoin how to use
There are totally transparent ways to spend bitcoin, too. For example, there is an official note on how to use Bitcoin to buy Tesla products on the vendor’s website. At the time of writing, the ability to pay in BTC is only available in the US. The tricky part is that the purchase might be taxable: it yet has to be unambiguously determined, if crypto is “currency”, “property”, or “security” because that would influence its regulation and taxation rules. The case of Ripple against the SEC should shed some light on the issue.
All kinds of other things, old and new, can be bought online for bitcoin.
Bitcoin can be won in games. Solve in-game puzzles for crypto rewards, for example, in Enjin-powered Age of Rust.
Naturally, it can be spent in games, too. If you’re hotheaded enough to seek out ways how to use bitcoin in online casinos, the latter themselves will provide you with plenty of guidelines.
How to use bitcoin for purchases
Hopefully, this bitcoin how to use guide served you a great deal in deciding what to do with the spare BTC. Either you’re one of the guys who were lucky to mine bitcoin in 2013 or a newcomer, there are plenty of ways how to use bitcoin for purchases in large and small quantities alike: via simple address-to-address transactions or merchant QR codes.
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