Part 1: Get a bitcoin wallet
In order to safely hold your own bitcoin, you need somewhere to store it. There are many different types of bitcoin wallets, but the most important considerations when choosing where to store your bitcoin are security and usability.
Security is important for obvious reasons; you don’t want someone to steal your bitcoin! Usability is similarly important; a wallet that is confusing to use can very easily lead to mistakes that result in the permanent loss of your bitcoin.
It’s worth keeping in mind that statistically you’re far more likely to lose bitcoin yourself by mistake than through getting hacked. But it’s also important not to let the personal responsibility that comes with interacting with this digital bearer asset intimidate you. If you follow this guide carefully, there is very little room for even the greatest of technophobes to lose bitcoin. Just be sure to protect your seed (read on for details)!
With great power comes great responsibility. And certainly, the power that bitcoin promises to adorn citizens in a new era of sovereign individuals vastly out-weighs the considerations necessary to safely secure it.
If you already have a bitcoin hardware wallet or hot-wallet (be careful!), feel free to skip to Part 2 of this guide (see below). as it simply outlines the process of setting up one of the most reputable bitcoin wallets at present, specifically Blockstream’s ‘Green Wallet’.
Green Wallet
The first section below details how to Download, Setup and Backup your wallet.
We recommend Blockstream’s Green Wallet as a first wallet since it is widely regarded as a leading bitcoin wallet in terms of security and ease of use. It is also compatible with both iPhone and Android and so is accessible for 95+% of smartphone users.
Green Wallet is an app, which among other things, can be used to receive and send bitcoin transactions. For this guide, we shall focus on receiving bitcoin. That said, the app is very intuitive to use so you’ll be all set to also send bitcoin in no time.
Step 1 — Download Green Wallet
Search for and download ‘Blockstream Green Wallet’ from the App Store or Google Play Store on your iPhone or Android respectively.
Step 2 — Initial Setup
Open the app and you’ll arrive at the on-boarding screen shown below.
Ensure that ‘Bitcoin’ is selected in the discrete dropdown menu below the logo at the top. If not, tap to open the menu and select ‘Bitcoin’ from the options.
This specifies that you would like your wallet to be connected to the the Bitcoin ‘Mainnet’ since you would like to receive real bitcoin, as opposed to ‘Testnet’ bitcoin which is a parallel network used for testing, and does not have any value. You’ll notice that there is another third option: ‘Liquid Bitcoin’ — ignore this for the moment, we’ll cover what this is in future blog posts.
There are also other advanced options (proxy and Tor) relating to your privacy — if you’re not sure what these mean then don’t worry about them now. Tap save and continue.
Then tap on ‘Create New Wallet’. You will be prompted to read the wallet Terms of Service (please note, this wallet is a third party and xsats is in no way affiliated with Blockstream Green or any other third parties unless otherwise stated by us). You must accept the terms in order to proceed.
Step 3 — Create Your Mnemonic Seed
This is probably the most important step, so please read and follow the instructions very carefully. Your seed is an ordered list of 24 words which acts as a ‘master password’ for your wallet. You must backup this mnemonic seed in a secure, offline location (e.g. written on a piece of paper and stored in a safe). If you lose your phone, you can restore your wallet and re-access your bitcoin using your seed.
Be very careful about who you tell about this seed. Anyone that gains access to this list of words has full access to all of the money in the associated wallet. To be extra clear, this means anyone who knows these 24 words can steal all of your money. This means you should treat this seed like diamonds or cash by storing it securely in a safe or otherwise secure and hidden place.
It is equally important to make sure that you do not accidentally lose or destroy your seed, for example in a house fire. Holding physical backups of the seed (other pieces of paper recording the 24 words) in disparate geographical locations helps to minimise risk of accidental damage or loss, but ensure that all backups are equally secure!
If you only hold small amounts of bitcoin in the wallet then obviously it’s not as necessary to go to such an extent to secure your seed. However, it’s important to ensure that the security arrangements of your seed(s) reflect(s) the value of bitcoin that the associated wallet stores.
The next few steps in the app take you through the process of recording and verifying your seed. Follow the in app directions to complete each step.
Step 4 — Create a PIN
Next create a pin to access the wallet. This pin is required every time you’d like to enter and use Green Wallet app, so be sure to remember it and keep it a secret to prevent those who access your phone from also accessing your bitcoin stored there. You can also enable Touch/FaceID or Android biometric login as relevant.
Step 5 — Enable 2FA
Given the nature of what is being stored in the wallet (a valuable, appreciating digital asset) it makes sense to add further security measures to further ensure that your bitcoin remains safe.
2FA or 2-Factor Authentication is an effective extra measure that helps protect your bitcoin by requiring an additional authentication from a separate source.
We recommend that you enable Google Auth based 2FA at a minimum. Tap the switch then copy the ‘key’ shown by the green font. You’ll now need to download the ‘Google Authenticator’ app from the App or Play Store.
Open Google Authenticator and tap on the ‘+’ to add 2FA for a new app — in this case Green Wallet. Now paste the ‘key’ that you copied before and give the account an appropriate name that you know relates to the wallet (e.g. ‘Green Wallet’). Proceed to add the new 2FA pairing.
You should also keep a backup of the 2FA key in case you lose access to your phone. If you lose this key, you’ll lose access to your wallet and need to restore your wallet using your seed phrase (remember: keep your seed safe!). Be sure to write your 2FA key on a piece of paper (or password manager) and perhaps store the backup safely with your paper seed backup.
You now have a TOTP (Time-based One Time Password) associated with your bitcoin wallet. True to its name, this is for single use during a particular period of time. It is refreshed every 30 seconds to provide a new number each time period i.e. each code is only valid during a short 30 second window. Whenever you are prompted for your 2FA, visit the Google Authenticator app on your phone and retrieve the TOTP.
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