Is Bitcoin safe? How do I know I won’t get cheated?

simple bitcoins

So is Bitcoin safe? There are a number of factors that will determine if any online banking system is secure. When Bitcoin is used properly, it is safe.

Why is Bitcoin safe?


If you are in the United States and use dollars, you can deposit and withdraw funds using Mt. Gox Coinbase, a service where you can buy and sell Bitcoin. Once you buy Bitcoins, you can store them in a digital wallet of your choice which you access with a number that’s provided, and a password you create. Nobody else knows or tracks this password – and if you lose the password, the Bitcoins are gone.

When you send or receive Bitcoins, the funds are sent immediately. The transaction takes a few minutes to an hour to clear for the recipient. The exact time partially depends if you allocate additional funds toward expediting the transfer (this is usually very small, $0.15 or less). Bitcoin clients give you a confirmation count, which tells you how many Bitcoin ledger build cycles have completed and continue to confirm the transaction. You probably can relax after just one confirmation since it is pretty tough to trick Bitcoin.

What do I need to worry about when using Bitcoin then?


Above I said Bitcoin is only safe when used properly. Be mindful of the ways you could expose yourself to risk. If one of the laptops, desktops, tablets or other devices you use is compromised with malware or a virus, that adds risk. When you access online Bitcoin resources, make sure you use an up to date web browser. Make sure the URL you visit looks correct and make sure your browser detects a valid security token – usually shown by green text as shown.

This is the look of a secure connection
A safe browser connection

If you use a wallet id shortener, make sure you use a publicly accepted one. Blockchain provides all users a standard short URL to receive money which is secure. But if you use another service, you add the risk of trusting another resource you don’t really need to use in the first place.

Note: Mt. Gox is now gone but was relevant when this was written in 2013

I have yet to withdraw funds from Mt. Gox so I can’t vouch for that experience but they have been good with deposits so far. They have been around for a few years and deal with millions of dollars worth of Bitcoins daily so they seem legit. However recently they seem to be having some issues. Some sites like howtobuybitcoins.info show how many Facebook likes each exchange source has. More likes probably means more happy users, and proportionally more credibility. Like I said, Mt. Gox Coinbase is your best bet, has the most Facebook likes, and it’s fairly quick.

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One last bit of advice is to always be mindful of the Bitcoin exchange rate against your local currency. If you live in the United States and use $US dollars for everything, then the BTC-e exchange rate for Bitcoins to $US dollars is what you need to know. That rate changes everyday and has fluctuated wildly this year, so it’s probably best to check the rate at the time of transaction. Keep in mind, Mt. Gox takes at least five business days so you might have to pay some premium for immediate exchange. I have a few Bitcoins and will exchange at a small markup if you need them immediately, email me if you’re interested.


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