Every so often at Coinmama, we get a question that makes us scratch our heads, rethink how we explain things, and go back to Bitcoin basics. Recently that question was “Can you tell me how to transfer Bitcoin to bank account?”
Experienced cryptocurrency buyers will know that the answer to that question is, “You can’t.” And while, sure, it’s tempting to leave it at that, we’re Coinmama, this is a family, and we’re not going to act like a sullen teenager! Nope, like a good Coinmama, we’ll do our best to unpack the question, figure out what’s really being asked, and how to answer the impossible.
A short history of Bitcoin
Credit card is one way to buy bitcoins without a bank account. The main benefit is that the delivery of coins is fast. The exchanges in the table below allow you to buy bitcoin with credit card. Connect Your Wallet to a Bank Account When you’ve obtained your wallet, you’ll need to link it to your bank account. This enables you to purchase coins and sell coins. Alternatively, your bank account may be linked to your cryptocurrency exchange account.
Let’s back up and take a minute to look at why you can’t simply transfer Bitcoin to your bank account. After all, if you’re in possession of a foreign currency, you can go to your bank branch and deposit it into your account at the current exchange rate. So why not Bitcoin?
The answer to this goes back to the origins of cryptocurrency as a decentralized currency. In 2008, in the wake of the financial crisis and with the banks on the brink of collapse, people were becoming distrustful of the banking system and wanted more control over their own economy. It was becoming more and more apparent that there was a need for a currency that wasn’t controlled by a central bank. Out of that need, Bitcoin was born as a decentralized global currency, one that was peer-maintained and eliminated the middle man, one that provided transparency. A currency that was different from other currencies.
In other words, Bitcoin was developed to exist outside of the banking system as we know it. So while it still functions the same way as a traditional fiat currency, it isn’t one. And because of that, you can’t simply transfer the Bitcoin you hold to your bank account. Why? Because even though it exists in tandem with fiat currencies, putting Bitcoin into the centralized banking system would be antithetical to its intent.
We are living in a material world…
Despite your interest in the financial revolution, you’re still living in a world that largely depends on fiat. After all, most landlords (and coffee shops) aren’t accepting Bitcoin for payment yet. So what happens if you’re in possession of a virtual handful of Bitcoins? Where do you store them? How do you use them? And if you’re not yet in possession of them, how to you buy those Bitcoins we speak of? There are so many questions! If you’re asking how to transfer Bitcoin to your bank account, you’re probably really asking one of those questions. Fret not! Coinmama has answers!
How to store Bitcoin: You can’t transfer Bitcoin to your bank account, but you still need to store it somehow. Before you buy Bitcoin, you need to set up a wallet that’s just for cryptocurrency. It is, in many ways, your Bitcoin bank account. There are wallets that are better for everyday crypto use, and there are wallets that are better for housing large sums that won’t be touched for a while. Many people even have more than one wallet—think of it as your checking and savings accounts for cryptocurrency!
How to use Bitcoin: While the ability to use Bitcoin as an everyday currency still isn’t widespread, it’s becoming more and more available. Many online retailers as well as some brick and mortar stores make paying with Bitcoin as easy as scanning a QR code. In other words, trade in your debit card for your wallet app—no bank account needed!
Of course, neither storing nor using Bitcoin is relevant if you don’t already have Bitcoin. Luckily, while we may not be able to help you transfer Bitcoin to your bank account, if you still need to buy Bitcoin, Coinmama makes that part easy.
- Overview - Table of Contents
Bitcoin mining is difficult to do profitably but if you try then this Bitcoin miner is probably a good shot.
How Bitcoin Mining Works
Before you start mining Bitcoin, it's useful to understand what Bitcoin mining really means. Bitcoin mining is legal and is accomplished by running SHA256 double round hash verification processes in order to validate Bitcoin transactions and provide the requisite security for the public ledger of the Bitcoin network. The speed at which you mine Bitcoins is measured in hashes per second.
The Bitcoin network compensates Bitcoin miners for their effort by releasing bitcoin to those who contribute the needed computational power. This comes in the form of both newly issued bitcoins and from the transaction fees included in the transactions validated when mining bitcoins. The more computing power you contribute then the greater your share of the reward.
Sometimes you may want to mine a more volatile altcoin like MWC which is superior for scalability, privacy, anonymity and fungibility by utilizing MimbleWimble in the base layer.
With mainnet launching in November 2019 it has risen from $0.22 to over $8.00 in its first two months.
Step 1 - Get The Best Bitcoin Mining Hardware
Purchasing Bitcoins - In some cases, you may need to purchase mining hardware with bitcoins. Today, you can purchase most hardware on Amazon. You also may want to check the bitcoin charts.
How To Start Bitcoin Mining
To begin mining bitcoins, you'll need to acquire bitcoin mining hardware. In the early days of bitcoin, it was possible to mine with your computer CPU or high speed video processor card. Today that's no longer possible. Custom Bitcoin ASIC chips offer performance up to 100x the capability of older systems have come to dominate the Bitcoin mining industry.
Bitcoin mining with anything less will consume more in electricity than you are likely to earn. It's essential to mine bitcoins with the best bitcoin mining hardware built specifically for that purpose. Several companies such as Avalon offer excellent systems built specifically for bitcoin mining.
Best Bitcoin Cloud Mining Services
Another option is to purchase in Bitcoin cloud mining contracts. This greatly simplifies the process but increases risk because you do not control the actual physical hardware.
Being listed in this section is NOT an endorsement of these services. There have been a tremendous amount of Bitcoin cloud mining scams.
Hashflare Review: Hashflare offers SHA-256 mining contracts and more profitable SHA-256 coins can be mined while automatic payouts are still in BTC. Customers must purchase at least 10 GH/s.
Genesis Mining Review: Genesis Mining is the largest Bitcoin and scrypt cloud mining provider. Genesis Mining offers three Bitcoin cloud mining plans that are reasonably priced. Zcash mining contracts are also available.
Hashing 24 Review: Hashing24 has been involved with Bitcoin mining since 2012. They have facilities in Iceland and Georgia. They use modern ASIC chips from BitFury deliver the maximum performance and efficiency possible.
Do You Need A Bank Account For Bitcoin Accounts
Minex Review: Minex is an innovative aggregator of blockchain projects presented in an economic simulation game format. Users purchase Cloudpacks which can then be used to build an index from pre-picked sets of cloud mining farms, lotteries, casinos, real-world markets and much more.
Minergate Review: Offers both pool and merged mining and cloud mining services for Bitcoin.
Hashnest Review: Hashnest is operated by Bitmain, the producer of the Antminer line of Bitcoin miners. HashNest currently has over 600 Antminer S7s for rent. You can view the most up-to-date pricing and availability on Hashnest's website. At the time of writing one Antminer S7's hash rate can be rented for $1,200.
Bitcoin Cloud Mining Review: Currently all Bitcoin Cloud Mining contracts are sold out.
NiceHash Review: NiceHash is unique in that it uses an orderbook to match mining contract buyers and sellers. Check its website for up-to-date prices.
Eobot Review: Start cloud mining Bitcoin with as little as $10. Eobot claims customers can break even in 14 months.
MineOnCloud Review: MineOnCloud currently has about 35 TH/s of mining equipment for rent in the cloud. Some miners available for rent include AntMiner S4s and S5s.
Bitcoin Mining Hardware Comparison
Currently, based on (1) price per hash and (2) electrical efficiency the best Bitcoin miner options are:
AntMiner S7
- 4.73 Th/s
- 0.25 W/Gh
- 8.8 pounds
- N/A
- 0.1645
AntMiner S9
- 13.5 Th/s
- 0.098 W/Gh
- 8.1 pounds
- N/A
- 0.3603
Step 2 - Download Free Bitcoin Mining Software
Once you've received your bitcoin mining hardware, you'll need to download a special program used for Bitcoin mining. There are many programs out there that can be used for Bitcoin mining, but the two most popular are CGminer and BFGminer which are command line programs.
Does Bitcoin Require Bank Account
If you prefer the ease of use that comes with a GUI, you might want to try EasyMiner which is a click and go windows/Linux/Android program.
You may want to learn more detailed information on the best bitcoin mining software.
Step 3 - Join a Bitcoin Mining Pool
Once you're ready to mine bitcoins then we recommend joining a Bitcoin mining pool. Bitcoin mining pools are groups of Bitcoin miners working together to solve a block and share in its rewards. Without a Bitcoin mining pool, you might mine bitcoins for over a year and never earn any bitcoins. It's far more convenient to share the work and split the reward with a much larger group of Bitcoin miners. Here are some options:
For a fully decentralized pool, we highly recommend p2pool.
The following pools are believed to be currently fully validating blocks with Bitcoin Core 0.9.5 or later (0.10.2 or later recommended due to DoS vulnerabilities):
Step 4 - Set Up A Bitcoin Wallet
The next step to mining bitcoins is to set up a Bitcoin wallet or use your existing Bitcoin wallet to receive the Bitcoins you mine. Copay is a great Bitcoin wallet and functions on many different operating systems. Bitcoin hardware wallets are also available.
Bitcoins are sent to your Bitcoin wallet by using a unique address that only belongs to you. The most important step in setting up your Bitcoin wallet is securing it from potential threats by enabling two-factor authentication or keeping it on an offline computer that doesn't have access to the Internet. Wallets can be obtained by downloading a software client to your computer.
For help in choosing a Bitcoin wallet then you can get started here.
You will also need to be able to buy and sell your Bitcoins. For this we recommend:
- SpectroCoin - European exchange with same-day SEPA and can buy with credit cards
- Kraken - The largest European exchange with same-day SEPA
- Buying Bitcoin Guide - Get help finding a Bitcoin exchange in your country.
- Local Bitcoins - This fantastic service allows you to search for people in your community willing to sell bitcoins to you directly. But be careful!
- Coinbase is a good place to start when buying bitcoins. We strongly recommend you do not keep any bitcoins in their service.
Step 5 - Stay Up To Date With Bitcoin News
Staying up to date with Bitcoin news is important for your bitcoin mining profits. If you want general Bitcoin news then we recommend the WeUseCoins news section.
There is the Bitcoin Mining News Section and these are the 5 most recent articles:
On 1 August 2017 BIP 148 occurred. To better understand how that works we recommend reading this UASF Guide.
Other Languages
Arabic - عربى
Burmese -
Chinese (Cantonese) - 广东话
Chinese (Mandarin) - 普通话
Dutch - Nederlands
French - Français
German - Deutsche
Georgian - ქართული
Greek - Ελληνικά
Hindi - हिंदी
Indonesian - Bahasa Indonesia
Italian - Italiano
Japanese - 日本語
Korean - 한국어
Lao - ລາວ
Norwegian - Norsk
Polish - Polskie
Portuguese - Português
Russian - Pусский
Spanish - Español
Swedish - Svenska
Tagalog - Tagalog
Thai - ไทย
Turkish - Türk
Vietnamese - Tiếng Việt