August 12, 2017cryptocurrencies Siacoin
With the explosion of Bitcoin (BTC), Ethereum, and Monero (XMR) combined with ICOs (Initial Coin Offering) a lot of folks are making a crap ton of money just for being at the right place at the right time. I’ve been watching from the sidelines and felt that the Siacoin project is actually pretty interesting so I decided to try buying Siacoin directly since mining is too expensive (for me anyway) and too time consuming. Purchasing Siacoin is kind of a convoluted process and there were bumps on the way so I thought I’d share my experience so that others don’t get caught off guard.
If you’ve read my post about AWS Siacoin and Monero Mining you know that I’ve been dabbling with Siacoin. It’s actually not the first time—I used AWS to mine a few Litecoin about 3 years ago. Not enough to retire on but a fun activity nonetheless. The biggest take away for me was that mining usually isn’t going to be the best way to gather a bunch of virtual coinage so you need to register with an exchange beforehand so you can quickly buy during the short dips. If you want to purchase when the next
crash dip comes—and it will come—you need to have your accounts setup so you can make that quick purchase because it can take several weeks just to get everything working and by that time it will be too late.
Before we continue, do know that I have no idea whether or not the value of Siacoin will dramatically increase. I like the idea of decentralized storage using blockchain and it’s interesting to me so why not? is about as deep as I’ve thought about Siacoin. Worse case scenario, I’m prepared to lose whatever time and money I invest. Best case scenario, Siacoin hits $1 USD a coin which is probably unlikely. This is just a small hobby for me and I have no expectations of becoming a millionaire. I will buy as much as I am prepared to lose, transfer them to a cold wallet, and forget about them except for the wallet password. In other words, don’t invest in Siacoin because I’m doing it since that would be incredibly stupid.
The Siacoin website lists their preferred exchanges and there is a really good unofficial guide at buyingsiacoin.com that describes in detail how to purchase using Coinbase and Bittrex. Basically as of today you cannot purchase Siacoin directly—you have to purchase another cryptocurrency such as Bitcoin, Ethereum, or Litecoin from an exchange like Coinbase, transfer your purchase to Bittrex, and then purchase Siacoin with the transferred cryptocurrency. In other words, its a pain in the rumpus. I followed the unofficial guide for the most part but didn’t setup the official Siacoin wallet until later because I didn’t feel like waiting for the 6 GB network synchronization.
I should also quickly mention that you shouldn’t keep your cryptocurrency in an online wallet for these specific events as highlighted in the unofficial guide from buyingsiacoin.com above. I’m sure the likes of Coinbase and Bittrex are doing their best to secure your crypto goodies but right now it’s the wild, wild, west out there so if you have a significant amount of valuable cryptocurrency keep it in an offline wallet. I was slightly burned by Mt. Gox and learned this lesson the hard way. Now on to trying to purchase Siacoin…
I already had a Coinbase account setup but I had to setup a Bittrex account. The Bittrex setup was actually quite easy and quick—it only took about 15 minutes. Once I got my Bittrex account setup I logged into my Coinbase account and decided that I’m prepared to lose 20 bucks. I made the purchase but was surprised to see a notice after I made the purchase that it would take a week:
WTF? Yeah, I know that “minor” detail was probably written somewhere but it seemed to come out of nowhere. Coinbase probably has been asked why it takes so long to make a purchase more than a few times so they have a FAQ here—Why does a buy take so long? Fast forward six days and I get an email from Coinbase that my Bitcoin purchase has completed and I now have whopping 0.006 BTC valued at $23.13 dollars since BTC’s value increased (hurray!) since my purchase:
The next step is to obtain a BTC address from Bittrex by clicking the plus sign next to BTC. This address is where you’ll send your Coinbase purchased BTC. I logged into my Bittrex account and copied it:
Going back to Coinbase click Send and paste the Bittrex BTC address into the Recipient field, the amount of BTC to send, and then a descriptive note:
You’ll get a chance to confirm that you didn’t mess anything up—click Confirm when you’re ready:
Once you click Confirm you’ll receive the following completion message:
When you go back to Bittrex you’ll see the transferred amount (minus the network fee) listed in the Pending Deposit column. Now you have to wait for the transaction to complete:
And then in about 30 ~ 60 minutes you’ll see your Available Balance:
Now open the BTC Markets section and search for SC (Siacoin). Click on the SC hyperlink:
Scroll down to Trading and under the BUY SIACOIN section—assuming that you want to use all of your available Bitcoin—select Max:
Next select Price and then choose Last for the last price:
Now the moment of truth—click the Buy Siacoin button:
And one more chance to backout…click the Confirm button:
A blue dialog box will appear in the top right of your screen stating, SC Buy Placed:
And then a green dialog box will appear stating, SC Buy Filled:
Click back on Wallets and check the Hide zero balances check box. After a week I’m now the proud owner purchased Siacoin albeit with a remaining fractional BTC balance:
While the Siacoin purchase process is a bit convoluted, it’s relatively simple—it’s the setting up the exchange accounts and having to wait for ACH bank transfers that take a long time. This is an important point to consider if you are planning on plopping down some hard earned money quickly when the cryptocurrency market bubble pops again.
You do have the option to buy instantly using a credit or debit card but at the expense of a 3.99% convenience fee but not named so at the Coinbase Pricing & Fees Disclosures page. I don’t know why but that term just irks the crap out of me but unfortunately, Convenience Fee is an actual financial term. While uttering a few expletives I begrudgingly tried making a credit card purchase but for Litecoin (LTC) this time:
I clicked the Buy Litecoin Instantly… button to make the purchase and then I immediately got an email from Coinbase stating that my transaction was cancelled. What the crap…
Then I also get an email from my credit card company stating that they’ve detected unusual activity and requested that I call immediately or “limitations” will be put on my card. Well crap, that sucks because I can’t just ignore it…
So I quickly called my credit card company, entered my info through the voice-hell-machine, and was told by the wanna-be-human-bot wait time is 7 minutes. Yeah, right. The background contemporary jazz was actually kind of nice but all of a sudden the music stops, I hear some frantic typing on the other end, and then an automated message that kept repeating every five seconds, Please wait…Please wait…Please wait…Please wait…Argghhhhhhh!!!
While I was waiting I opted to watch some John Oliver—specifically this episode—and before I knew it over 30 minutes had passed. So much for seven minutes:
Obviously something was wrong so I hung up and called again, this time trying the call me back feature. I was called back in about 8 minutes, spoke to a polite individual, explained that I made the purchase, and then the security flag was removed from my account. I tried again a week later but this time I tried to buy Bitcoin since I had a fractional amount of BTC leftover in my Bittrex wallet from the previous purchase:
It worked—this time no alarms from neither Coinbase or my credit card company. I received an email from Coinbase confirming that my purchase was successful and now available in my account:
I transferred the amount to Bittrex and it took about 30 minutes to become available:
And finally purchased some more Siacoin but unfortunately, still have a fractional BTC balance—oh well:
If you have an itch to do anything related to cryptocurrency speculation and investment, you’d better get your accounts setup and tested because that instant opportunity will pass you by with two middle fingers if you aren’t prepared. As you can see from my experience there are a few bumps in the road that might catch you off guard so make sure you test so that you’ll be successful when the time comes to buy when everyone else is panicking. I just invested $40 and it would be really cool to see those 4,942 Siacoins turn into $4,942 one day. Until then, Siacoin will not be on my mind but if you found this post useful and are in a giving mood, sign up to Coinbase using this affiliate link.
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