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Cold Wallet Vs. Hot Wallet

What’s The Difference?
The simplest way to describe the difference between a cold wallet and a hot one is this: hot wallets are connected to the internet while cold wallets are not. Most people who hold digital assets have both cold and hot wallets because they are designed for different purposes.

HOT WALLETS
Accounts within digital asset exchanges like Poloniex and Bittrex are considered hot wallets because these companies hold your funds in their infrastructure and servers. If a hacker drains Poloniex and you have an account with them, then there’s a good chance you will lose your money because Poloniex in actuality holds your funds.
If you have a Coinbase account, then this is also considered a hot wallet. If Coinbase gets hacked, you could lose your funds. Keeping small amounts in Coinbase is a best practice. Buying and selling Bitcoin using Coinbase is safe as long as you move your money after the trades.

SOFTWARE
Another kind of hot wallet like Exodus.io is a software application that is downloaded to your computer. There are many kinds of wallets like this including the Dash QT wallet. In this type of wallet, Exodus doesn’t store your private keys on its servers and therefore, your money is under your control, not theirs. But your money is still vulnerable because a hacker could get your funds by gaining access to your computer. The Exodus wallet is designed to interact directly with the different blockchains. Exodus supports many different digital assets as well.

COLD WALLETS
There are different kinds of cold wallets but I’m only going to focus on the hardware variety. I have discussed Paper Wallet in my previous post so please reference to it.

A hardware wallet is a physical device that is kept offline but has the ability to be plugged into a computer when needed. Hardware wallets are safe because when you make a transaction, they ask you to confirm each one by pressing a button on the device. They are pretty much hacker-proof.
There are three main hardware wallet brands: Trezor.io, Ledger Nano S and KeepKey.

WHAT IS PAPER WALLET?
A paper wallet is an offline mechanism for storing Bitcoins. The process involves printing the private keys and Bitcoin addresses onto paper. Physical wallets, also known as "physical Bitcoins," are considered one of the safest ways to store Bitcoins provided certain security precautions are followed. Images of physical Bitcoins are commonly seen in media coverage in innovative styles, mostly with a ‘new look’ of the coin and the private key printed either on paper, plastic, or metal.

BREAKING DOWN 'Paper Wallet'
A paper wallet is considered a safe way to keep Bitcoins safe from cyber-attacks, malware, etc. A paper wallet involves "printing" and storing Bitcoins in an offline mode. But it's important to remember that, it’s not the Bitcoins that are being printed out like regular currency. It's the information stored in a Bitcoin wallet or digital wallet that gets printed out. The data appearing on the wallet includes the public key (wallet address), which allows people to transfer money into that wallet, and the private key, which gives access to fund spending. Thus, Bitcoins themselves are not stored offline, but the important keys are stored offline.

The main advantages of the paper wallet include: safety from malware and key loggers; not having to bank upon the security of any website; and protection of private keys by 100% ownership. The flipside, however, is that the safety of the physical document can't be guaranteed either. All information required to spend the Bitcoins is there on a paper and thus should be kept very secure. If a paper wallet is lost, there will be no way to access the Bitcoins sent to that address.

Some of the popular tools for producing paper wallets are BitcoinAddressUtility, BitAddress.org, BitcoinpaperWallet.com, OfflineAddress.com, and SafePaperWallet.com. There are some companies that even offer "cold storage" services, i.e. keeping the private key in printed form in a physical location like a safe vault. Such companies are not regulated by the financial services industry, but they are insured against theft.

WHAT IS A BITOCOIN WALLET?

DEFINITION of 'Bitcoin Wallet'
A Bitcoin wallet is a software program where Bitcoins are stored. To be technically accurate, Bitcoins are not stored anywhere; there is a private key (secret number) for every Bitcoin address that is saved in the Bitcoin wallet of the person who owns the balance. Bitcoin wallets facilitate sending and receiving Bitcoins and gives ownership of the Bitcoin balance to the user. The Bitcoin wallet comes in many forms; desktop, mobile, web and hardware are the four main types of wallets.

BREAKING DOWN 'Bitcoin Wallet'
A Bitcoin wallet is also referred to as a digital Wallet. Establishing such a wallet is an important step in the process of obtaining Bitcoins. Just as Bitcoins are the digital equivalent of cash, a Bitcoin wallet is analogous to a physical wallet. But instead of storing Bitcoins literally, what is stored is a lot of relevant information like the secure private key used to access Bitcoin addresses and carry out transactions. The four main types of wallet are desktop, mobile, web and hardware.

Desktop wallets are installed on a desktop computer and provide the user with complete control over the wallet. Desktop wallets enable the user to create a Bitcoin address for sending and receiving the Bitcoins. They also allow the user to store a private key. A few known desktop wallets are Bitcoin Core, MultiBit, Armory, Hive OS X, Electrum, etc.

Mobile wallets overcome the handicap of desktop wallets, as the latter are fixed in one place. Once you run the app on your smartphone, the wallet can carry out the same functions as a desktop wallet, and help you pay directly from your mobile from anywhere. Thus a mobile wallet facilitates in making payments in physical stores by using "touch-to-pay" via NFC scanning a QR code. Bitcoin Wallet, Hive Android and Mycelium Bitcoin Wallet are few of the mobile wallets.

As for web wallets, they allow you to use Bitcoins from anywhere, on any browser or mobile. The selection of your web wallet must be done carefully since it stores your private keys online. Coinbase and Blockchain are popular web wallet providers.

The number of hardware wallets is currently very limited. These devices can hold private keys electronically and facilitate payments but are still in the development phase.

Keeping your Bitcoin wallet safe is very crucial. Some safeguards include: encrypting the wallet with a strong password, and choosing the cold storage option i.e. storing it offline. We will discuss Paper Wallet in our next post.

SO WHAT IS KEEPING THE BITCOIN DECENTRALIZED?

Bitcoin Core is programmed to decide which block chain contains valid transactions. The users of Bitcoin Core only accept transactions for that block chain, making it the Bitcoin block chain that everyone else wants to use

It is these users who keep Bitcoin decentralized. They individually run their own Bitcoin Core full nodes, and each of those full nodes separately follows the exact same rules to decide which block chain is valid.

There’s no voting or other corruptible process involved: there’s just individual software following identical rules—”math”—to evaluate identical blocks and coming to identical conclusions about which block chain is valid.

This shared agreement (called consensus) allows people like you to only accept valid bitcoins, enforcing Bitcoin’s rules against even the most powerful miners.

In addition to improving Bitcoin’s decentralization, Bitcoin Core users get better security for their bitcoins, privacy features not available in other wallets, a choice of user interfaces and several other powerful features.
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EXCERPT FROM WIKIPEDIA
Bitcoin Core is the reference client of bitcoin. Initially, the software was published by Satoshi Nakamoto under the name Bitcoin, and later renamed to Bitcoin Core to distinguish it from the network.

Developer(s): Bitcoin Core developers
Stable release: 0.15.1 (November 11, 2017; 49 days ago)
Written in: C++
Operating system: Linux, Windows, macOS
Original author(s): Satoshi Nakamoto
Initial release: 2009
Weblink:

Bitcoin - Open source P2P money Bitcoin is an innovative payment network and a new kind of money. Find all you need to know and get started with Bitcoin on bitcoin.org.

BitterflyCoin aims to give awareness, training and help those who wants to earn passive income in cryptocurrency. Many people are already investing in cryptocurrency throughout the world.
How about the rest of us? It is not about finding a Crypto investor, sign up and start investing but more about understanding how the whole system works and how to be profitable and avoid being scammed.
BitterflyCoin is committing time and resources to do research and analysis and will post relevant information to keep everyone apprise.

HAPPY CRYPTO INVESTING

"Yumi wok helpim yumi yet long PNG"

PONZI SCHEMES VS. PYRAMID SCHEMES
Differences Between Ponzi Schemes and Pyramid Schemes

GETTING INVOLVED
Ponzi schemes and pyramid schemes are types of securities fraud where existing investors are paid by the contributions of new investors. Although the terms Ponzi scheme and pyramid scheme are often used interchangeably, there are some important differences between them:

Ponzi scheme participants typically believe they invested in an actual security, and are unaware that they are involved in a Ponzi scheme. Although pyramid scheme operators often conceal the true nature of the scheme, participants are typically aware that they are responsible for recruiting new members, and that new members are a source of profit for existing members.

LEVEL OF INVOLVEMENT
After their initial investment, Ponzi scheme participants are not actively involved in the scheme. Pyramid schemes require more active involvement, as existing participants are required to recruit new participants to contribute to the scheme.

SOURCE OF PAYMENTS
In both Ponzi schemes and pyramid schemes, existing investors are compensated by the contributions of new investors. Ponzi scheme participants believe they are earning returns from their investment, while pyramid scheme participants are aware that they are earning money by recruiting new participants.

HOW LONG IT TAKES TO COLLAPSE
Ponzi schemes can often take many years to collapse, provided there are sufficient numbers of investors. A good example of this is the Ponzi scheme operated by Bernie Madoff for over 30 years. Pyramid schemes typically collapse quickly, due to the rapid growth required to sustain them.

What is Ponzi scheme? (Excerpt from Wikipedia)
A Ponzi scheme (/ˈpɒn.zi/; also a Ponzi game) is afraudulent investment operation where the operator generates returns for older investors through revenue paid by new investors, rather than from legitimate business activities or profit of financial trading. Operators of Ponzi schemes can be either individuals or corporations, and grab the attention of new investors by offering short-term returns that are either abnormally high or unusually consistent.

Companies that engage in Ponzi schemes focus all of their energy into attracting new clients to make investments. Ponzi schemes rely on a constant flow of new investments to continue to provide returns to older investors. When this flow runs out, the scheme falls apart.
The scheme is named after Charles Ponzi who became notorious for using the technique in the 1920s. The idea, present in novels (for example, Charles Dickens' 1844 novel Martin Chuzzlewit and 1857 novel Little Dorrit each described such a scheme, was performed in real life by Ponzi, and became well known throughout the United States because of the huge amount of money he took in. Ponzi's original scheme was based on the arbitrage ofinternational reply coupons for postage stamps; however, he soon diverted investors' money to make payments to earlier investors and himself.

List of Scamcoins
Beware of scamcoins! Premine, instamine, hidden launch – those coins were created in “get rich quick” scheme in order to make money only by their creators and small group involved in instamine or premine.

Do not use these coins, let them fall into limbo. Using them it’s waste of your time, money and CPU/GPU power.

List of scamcoins – do not use:
PXC Phenixcoin: premined 1,000,000 coins
BTB Bitbar – premined by small group of coin creators
MNC Mincoin – started with no binaries and 25000% reward blocks
GLD Goldcoin – 2000% superblocks at start (3.2% instamine)
AMC Americancoin- premined with 6.5k-14k blocks giving zero reward
LKY LuckyCoin – superblocks at start, random superblocks
MEM MEMEcoin – premined, superblocks
ARG Argentum – premined
StableCoin – 1,200,000 premined
NUG Nuggets – premined
CDC Cloudcoin- 1,000,000 premined, random blocks
CENT Pennies – hidden launch
SYC Skycoin – premined
CL Copperlark – massively premined
NAN NanoTokens – premined
MST MasterCoin – premined
USC UScoin – premined
GIL – premined
RCH RichCoin – premined
XNC XenCoin – premined
REC RealCoin – premined
RED Recoin – 1,000,000 premined
ALF Alphacoin – premined
One Last Coin – premined
ORB Orbitcoin – 66% premined
NUC Nucoin – premined