How do I Earn Compound Interest on My Bitcoin Balance

Freebitco.in is an old (est. 2013) and trusted Bitcoin faucet. I’m not here to discuss their faucet, or the merits of earning 0.1 cents worth of Bitcoin an hour clicking a button (although you can do that if you really want to).

I’m here to explain how to safely earn 4.08% annual interest, paid out (& compounded) daily on all that Bitcoin you’re idly HODLing in your wallet. Hurray!

Click Here to join Freebitco.in

< 1 min superfast how-to:

1. Create a Freebitco.in account
2. Click ‘Earn BTC’ in the top menu and then ‘Deposit’ to get your deposit address.
3. Deposit a minimum of just 30,000 Satoshis (0.0003 BTC) to your Freebitco.in BTC address and you will earn 4.08% annual interest, paid out (and compounded) daily.
4. Withdraw your Bitcoin any time, to any BTC address.
5. That’s it

Grow your Bitcoin balance, earn a passive income and beat the bear market, starting immediately: here.

What does 4.08% annual interest paid daily, look like?

Below is a table illustrating modest annual interest earned on Freebitco.in using 1 BTC as a simple example (though you can start with as little as 0.0003 BTC).

You are right to be skeptical.

In the Wild West of crypto — every actor should be questioned, investigated, and assessed. So…

Who are Freebitco.in?

Freebitco.in is a Bitcoin faucet and mining business with a ‘provably fair’ higher/lower dice game and lottery.

• 18.5 million registered users 👪
• Founded 2013, one of the oldest names in Crypto 🏺
• Bitcoin mining company ⛏️
• Bitcoin faucet 🚰
• Bitcoin higher/lower dice game and lottery 🎰
• Registered in the British Virgin Islands 🇻🇬

How do they make money?

Most of Freebitco.in’s income comes from their higher/lower ‘Multiply BTC’ betting game. A version of a classic casino dice game where you stake Bitcoin on whether a random number generator will generate a number above or below a certain value. The house has a 5% edge in this game and so, mathematically, eventually… they always win.

Yes they’ve distributed 173,140 BTC to their users, but they’ve made 161,000 more:

Their current setup is very financially successful. From their website:
"When you hold money in your FreeBitco.in account, we split it into 3 parts — the first part is used to cover user withdrawals, the second part is used to bankroll our MULTIPLY BTC game and the third part is used to expand our bitcoin mining operation (which is currently 9.065 Petahashes or 0.021% of the total hashpower of the bitcoin network). We make a profit and assume the full risks of our businesses and in return for you saving your money with us, we give you a risk-free fixed rate of return"

Can you trust them?

When reflecting on the great scams of crypto past, Freebitco.in is comparatively red-flag free. Personally — I have stored my BTC with Freebitco.in for around 14 months. Here are some important observations:

• ‘Instant’ Bitcoin withdrawals happen within 15 minutes of initiating them, every time.
• Interest payments are made (in BTC) into your account, automatically, every day, without fail.
• There is no lock-in for Bitcoin you hold with them.
• 4.08% per annum is actually a very modest rate of return.
• The minimum balance (0.0003 BTC) to start earning interest is very low.
• You can see transparent statistics and data across a range of their website operations.
• Their current business model is hugely successful, and independent of market swings—making around twice as much BTC in their higher/lower game as they have paid out.

The major (and obvious) caveat here — is that Freebitco.in do HODL your Bitcoin for the period it earns interest. They have the private keys, not you.

In terms of external assessments of Freebitco.in’s trustworthiness, I point to an in-depth review by Tim from educational blog ‘scambitcoin.com’ as well as numerous Bitcointalk threads on this exact topic: [1] [2] [3]. As ever — Do Your Own Research.

In their own words:
"We have been in business since 2013 and are one of the most popular bitcoin websites (check our Alexa rank here). Our users have deposited thousands of bitcoins and we have paid out tens of thousands of bitcoins over the years. We have also published proof of our mining operation above which can be used to monitor the mining payments we receive. We would recommend that you start saving small amounts first until we have earned your trust after which you can save larger amounts with us if you feel comfortable doing so."

Further information (Freebitco.in FAQ)

Is there a lock-in period or minimum investment period before I start earning interest?

No! You start earning interest from the first day itself. There is no lock-in period, you can withdraw your bitcoins anytime you wish by using the WITHDRAW button at the top of the page.

Will the interest rate be fixed forever or can it change?

We may change the interest rate in the future if circumstances change. However, we shall communicate all rate changes at least 30 days in advance via the website and our twitter account (https://twitter.com/freebitco).

How do you store bitcoins securely?

We use a combination of hot wallets, hardware wallets (Trezor) and BIP38 encrypted paper wallets to store bitcoins. At no time do we keep more than 5% of our total bitcoins in the hot wallet which is used for making payouts. The hardware wallet is used as a “warm” wallet and bitcoins are transferred from it to the hot wallet as required. Our paper wallets serve as our “cold” storage with the wallets generated on an air-gapped computer running Tails OS. Our hardware and paper wallets are also secured against physical theft as the hardware wallet requires a pin code and encryption password to access and the private keys in the paper wallet are encrypted which means that the coins in the wallet cannot be accessed without having both the private key and the encryption password. We also keep physical copies of the cold storage wallets at multiple locations.

Comment if you have any questions!

Everything discussed in this article is for education purposes and in no way financial advice. Links to Freebitco.in included in this article are affiliate links and I will receive a small amount of BTC if you do decide to register/save with them.

Continue reading How do I Earn Compound Interest on My Bitcoin Balance

The Reasons Why You must Have Compound Interest Right Now

It is said that Albert Einstein once noted that the most powerful force in the universe was the principle of compounding. In investing and finance, this force manifests itself through the concept of compounding interest.

In simple terms, compound interest means that you begin to earn interest on the interest you receive, which multiplies your money at an accelerating rate.

In other words, if you have $500 and earn 10% in interest, you have $550. Then, if you earn 10% of interest on that, you end up with $605. And so on, until eventually, your original $500 is eclipsed by the amount of interest you have gained.

This is the reason for the success of many top investors. Anyone can take advantage of the benefits through a disciplined investing program.

Three Elements That Determine Your Compound Interest Returns

Three factors will influence the rate at which your money compounds. These are:

1. The interest rate you earn on your investment, or the profit you earn. If you are investing in stocks, this would be your total profit from capital gains and dividends.
2. Time left to grow. The more time you give your money to build upon itself, the more it compounds.
3. The tax rate, and when you have to pay taxes on your interest. You will end up with far more money if you don’t have to pay taxes at all, or until the end of the compounding period rather than at the end of each year. This is why accounts such as the traditional IRA, Roth IRA, 401(k), SEP-IRA, and other tax-deferred IRAs are so important.

Compound Interest and the Time Value of Money

The foundation behind compounding interest is the concept of the time value of money, which states that the value of money changes depending upon when it is received. Having $100 today is preferable to receiving it a years' time from now because you can invest it to generate dividends and interest income. Compounding interest allows that money to grow. By postponing the receipt of the $100, your opportunity cost grows.

Opportunity cost is the loss of possible gains if an action is not chosen—in this case, the amount of money you do not receive if you take no action with it. If you did not invest the $500, you have lost the opportunity to earn $50 you could have gained in a year. In 10 years, your $500 would have been $1,427—you have lost the opportunity to gain $927 by not investing the money.

When you understand the time value of money, you'll see that compound interest and patience are the ingredients for wealth. As an example, if you wanted $1 million for retirement, and could save $800 per month, with 8% per year on your investments, would you be able to? The U.S. Securities exchange commission provides a calculator to help you figure out how long it would take (in this scenario, you'd break $1 million in 29 years).

Compound Interest Results Over Time

The best way to understand these concepts is to put them into a compound interest table that shows you just how substantially your wealth can multiply over time.

Imagine you have an investor who sets aside a lump sum of $10,000. Take a look at the compound interest chart to see the influence of time and rate of return on his ultimate wealth. Once you understand this, it becomes evident that saving money alone is not the key to a large fortune.

For instance, a 20-year-old that invests $10,000 today and parks it in Treasury bills, earning 4% on average for the next 50 years, will find himself with $71,067 if the purchases were made through ​a tax-free account such as a Roth IRA. Had he invested in stocks and real estate, earning a 12% average rate of return over the same time, he would have ended up with $2,890,022. Adding higher returning asset classes would result in over 40 times more money thanks to the power of compound interest.

Resist the Temptation of Higher Returns Through Risk

One glance at the compound interest chart and you may want to do whatever it takes to earn a higher rate of return. Higher return rates can be dangerous because higher rates of return always bring higher risk. Unless you know what you're doing, no matter how successful you are along the way, you always want to avoid the possibility of losing more than a budgeted amount of investing principle.

Benjamin Graham, known as the father of value investing, was aware of this risk when he said that more money has been lost reaching for a little extra return or yield than has been lost to speculating. He warned that it is one of the greatest temptations new investors face when building a portfolio.

Continue reading The Reasons Why You must Have Compound Interest Right Now

The Best Way to Send and Receive Bitcoin

The best way to send and receive bitcoin is by using coinbase, because its really easy, fast, and safe. Click Here to join coinbase

How do I Send Bitcoin to another wallet with Coinbase?

Website

1. Navigate to your Portfolio page on the main navigation bar
2. Select the Send button for the cryptocurrency wallet that you'd like to send from
3. On the send dialog, select Wallet Address if you're sending to a cryptocurrency wallet external to Coinbase or Email Address if you're sending via email
4. Enter the amount of cryptocurrency you'd like to send in the Amount field. Alternatively, you can specify the amount you would like to send in your local currency. Note that the funds will always be sent as cryptocurrency, not your local currency
5. Select Continue
6. Confirm the details of the transaction and complete the send

IOS

1. Select the menu icon near the top left of the screen to open the navigation bar
2. Select the wallet you wish to send from
3. Select the paper airplane icon in the upper right hand of the screen
4. Enter the amount you wish to send (select the up/down arrows to switch between currencies)
5. Select Send
6. Enter the email or wallet address and any notes you wish to include
7. Review the details of your transaction and select Send in the upper right corner of the screen.

Or if you have been provided a QR code:

1. Select the QR icon in the upper right
2. Take a picture of the QR code
3. Enter the desired amount and select Continue
4. Review the details of your transaction and select Send in the upper right corner of the screen

Android

1. Select the menu icon near the top left of the screen to open the navigation bar
2. Select the wallet you wish to send from, located in the navigation bar
3. Tap the + icon near the lower right hand of the screen
4. Tap Send
5. Enter the amount you wish to send (select the up/down arrows to switch between currency selection)
6. Enter the email or wallet address and any notes you wish to include
7. Review the details of your transaction and select the forward arrow in the upper right corner of the screen

Or if you have been provided a QR code:

1. Select the QR icon in the upper right
2. Take a picture of the QR code.
3. Enter the desired amount and press Continue
4. Review the details of your transaction and tap the forward arrow in the upper right corner of the screen

How do I Receive Bitcoin from another wallet with Coinbase?

You can use your Coinbase wallet to receive supported digital currencies* by publicly displaying a wallet address or by providing one of your wallet addresses to someone directly. If you are receiving from another Coinbase customer, you can have them send digital currency to the email address you used when creating your account. To find a wallet address, click 'Wallet Address' near the top right corner of the account page, or by navigating here (be sure to select the correct currency account). To find a QR code / address using the mobile app:

IOS

1. Tap the QR icon in the upper right.
2. Tap 'My address' near the top of the screen.
3. Allow the sender to scan your QR code or click "Copy Address" and send your address to the other party.

Andoid

1. Tap the QR icon in the upper right.
2. Tap 'My address' near the top of the screen.
3. Allow the sender to scan your QR code or click 'Copy Address' and send your address to the other party.

Continue reading The Best Way to Send and Receive Bitcoin

You Must Have This to Buy Bitcoin

What Should I Prepare to Buy Bitcoin?

1. Digital Wallet

In order to conduct transactions on the bitcoin network, participants need to run a program called a “wallet.” Bitcoin is not technically “coins,” so it only seems right that a bitcoin wallet would not actually be a wallet. Bitcoin balances are maintained using public and private “keys,” which are long strings of numbers and letters linked through the mathematical encryption algorithm used to create them.

The public key is the location where transactions are deposited to and withdrawn from. This is also the key that appears on the blockchain ledger as a user’s digital signature, not unlike a username on a social media newsfeed. The private key is the password required to buy, sell, and trade the bitcoin in a wallet. A private key should be a guarded secret and only used to authorize bitcoin transmissions. Some users protect their private keys by encrypting a wallet with a strong password and, in some cases, by choosing the cold storage option; that is, storing the wallet offline. Coinbase offers a secure "multisig vault" to host user keys.

Important : A bitcoin wallet should not be used for long-term storage. Instead, bitcoin or its key should be stored in a secure wallet such as one that uses a multi-signature facility for security.

2. Personal Documents

The U.S. Securities and Exchange Commission requires users to verify their identities when registering for digital wallets as part of its Anti-Money Laundering Policy. In order to buy and sell bitcoin, you will need to verify your identity using several personal documents including your driver’s license and Social Security number (SSN).

3. Secure Internet Connection

If you choose to trade bitcoin online, use discretion about when and where you access your digital wallet. Trading bitcoin on an insecure or public wifi network is not recommended and may make you more susceptible to attacks from hackers.

4. Bank Account, Debit Card, or Credit Card

Once you have a bitcoin wallet, you can use a traditional payment method such as a credit card, bank transfer (ACH), or debit card to buy bitcoins on a bitcoin exchange. The bitcoins are then transferred to your wallet. The availability of the above payment methods is subject to the area of jurisdiction and exchange chosen. Below is a screenshot of the bitcoin interface on Coinbase showing how to buy and sell bitcoin and also Bitcoin Cash, Ethereum, and Litecoin​, which are other popular virtual currencies. The user clicks the "Buy" tab to buy digital currency and the "Sell" tab to sell digital currency. You select which currency you are buying/selling and which payment method (your bank account or credit card) you want to use.

Depending upon the exchange, there may be benefits and disadvantages to paying with cash, credit or debit card, or bank account transfer. For instance, while credit and debit cards are among the most user-friendly methods of payment, they tend to require identification and may also impose higher fees than other methods. Bank transfers, on the other hand, typically have low fees, but they may take longer than other payment methods.

5. Bitcoin Exchange 

After you’ve set up your wallet with a payment method, you'll need a place to actually buy bitcoin. Users can buy bitcoin and other cryptocurrencies from online marketplaces called “exchanges,” similar to the platforms that traders use to buy stock. Exchanges connect you directly to the bitcoin marketplace, where you can exchange traditional currencies for bitcoin.

Remember that the bitcoin exchange and the bitcoin wallet are not the same things. Bitcoin exchanges are similar to foreign exchange markets. The exchanges are digital platforms where Bitcoin is exchanged for fiat currency—for example, bitcoin (BTC) for U.S. dollars (USD). While exchanges offer wallet capabilities to users, it is not their primary business. Since wallets must be secure, exchanges do not encourage storing large amounts of bitcoin or for long periods. Therefore, it is advisable to transfer your bitcoins to a secure wallet. Because security must be your top priority when choosing a bitcoin wallet, opt for one with a multi-signature facility.

There are many well-established exchanges that provide one-stop solutions with high security standards and reporting, but due diligence should be exercised when choosing a bitcoin exchange or wallet. Besides Coinbase, other popular exchanges include Binance, Luno and Indodax.

Continue reading You Must Have This to Buy Bitcoin

5 Reasons You Must Have Bitcoin on Your Investment Portfolio

Bitcoin is a decentral blockchain-based currency. Bitcoin allows the owner to have full control of his assets. Intermediate entities like banks aren’t required anymore. So this new technology can be seen as an alternative to the traditional banking system. Exactly therefore the Bitcoin was created back in 2009 after the worldwide economic crisis brought the banks to shake. In addition, Bitcoin offers relatively cheap and fast cross-border payments. All you need for using the Bitcoin network is a smartphone.Now if you are thinking about how to buy Bitcoin or why should I buy Bitcoin then this post is for you.

There are 5 Reasons You Must Buy Bitcoin

1. Bitcoin Price Correction

Bitcoin price has always been volatile. For example, in the year 2017, Bitcoin’s price has reached its all-time high of 19500 USD and after that, it displayed the price correction. Now, in the year 2019, BTC observed the bearish market and it touched the lowest price of 3200 USD. Now, once again it is showing the signs of recovery. This is one of the main reasons why one should buy Bitcoin.

2. Bitcoin Halving

Bitcoin supply is limited. Over time fewer bitcoins are being created because the flow of creation keeps getting cut into half. The next Bitcoin halving will happen in May 2020. Ultimately, after 20 years, all bitcoins will be mined. So, there will be almost 21 million total BTC in circulation. Right now, there are approximately 18 million coins. Due to the deficiency, the price continues moving up at a very startling rate. This is exactly the opposite of how the FIAT Currency system works. In the case of the fiat currency system, the central bank keeps creating new money. The thing is that it is no longer backed by anything of value. This eventually prompts inflation and depreciates the value of already saved money. There are many speculations that Bitcoin price will increase after the Bitcoin halving 2020.

3. Price of Altcoins depends on Bitcoin

As we all know, Bitcoin is the main currency of the cryptocurrency world. If you closely observe and analyze the crypto market then you will find that the price of altcoins, depends on bitcoin. Right now, Bitcoin domination is approximately 70%, which is huge. On the other hand, this level of domination implies that at the time when the dominance of Bitcoin commences to fade, the prices for altcoins will improve. Maybe even we will observe the term of altcoins. This is also one of the main reasons why one should buy Bitcoin now.

4. Long term investment

Many people have predicted that 2020 will be the year for Bitcoin. For example, John McAfee, a famous name in the crypto industry has already predicted that Bitcoin would touch $1 million by 2020. If we study the BTC price closely then you will find that recent Bitcoin trading volume has touched record highs in the country like Venezuela. Also, the NASDAQ stock exchange will append the BTC index. Bitcoin has been displaying a positive trend and has almost touched $9000 a few days ago. The market capitalization of Bitcoin is 130 billion USD and a circulating supply of 17,743, 737 BTC. As Bitcoin halving is just a few months away, the market analysts are predicting a very high wave for Bitcoin price after the halving. If you study the pattern of Bitcoin price after the halving then you will find that BTC price has always surged after the halving event.

5. Bitcoin is an exceptional option to gold

When a stock has a limited quantity, then the demand for the stock rises, the price will rise as well to match the expanded demand but continuous supply.

The creation of both bitcoin and gold demand stock allocation. The primary investment in tools is required to create each stock that is factored into the cost. Just like gold mining, Bitcoin can also be mined. As mentioned earlier, there are limited Bitcoins (21,000,000 million). And the supply of gold is restricted to the value of gold available. As demand for each of these stocks increases, the supply prevails to be the same and their prices increase. This is one of the main reasons to buy Bitcoin.

Continue reading 5 Reasons You Must Have Bitcoin on Your Investment Portfolio