How to Install your first BitCoin wallet app

This is part of a multi-part series of articles on how to get started in cryptocurrencies. This article is the first step you need to take: Installing your first wallet app. Before you do anything else, you must first create your own BitCoin wallet.

What does this mean and why?

In the cryptocurrency world, YOU are your own bank. That means YOU are 100% in control of your cryptocurrency and no one else. This means no one can steal your funds… not a bank, not the government, not hackers that hack a cryptocurrency exchange.

What’s a cryptocurrency exchange?

A cryptocurrency exchange is a CENTRALIZED authority where you can buy cryptocurrency with fiat currency. One of the articles in this series will cover that. Fiat currency is money you’ve been using your whole life like U.S. dollars, the British pound, the Euro, etc… Currencies created by and issued by governments are “fiat” currencies. Cryptocurrencies are created by citizens with complex computer code and not under the control of governments and are not assigned to any one country. They are borderless.

A cryptocurrency exchange is essentially a centralized bank. They are your “on ramp” and “off ramp” for cryptocurrency. (they’re not the ONLY way to acquire crypto) Before you buy any cryptocurrency with fiat from an exchange, you need to have your own, personal cryptocurrency wallet set up so that you can immediately transfer your purchased crypto into your own personally controlled wallet. If you don’t do that, you’re not in control of your crypto. “Not your keys, not your crypto”.

Not Your Keys, Not Your Crypto!

People often make the HUGE mistake of purchasing crypto, but then NOT moving it to their own, personal wallets. This is why people WRONGLY claim that crypto is always stolen. IT IS NOT! If they had moved their crypto into their own personal wallet files, the massive thefts of crypto that happened at exchanges like Mt Gox would NEVER have happened!

The REASON people lost money with exchanges is because they made the fatal mistake of LEAVING their crypto IN A CENTRALIZED BANK! Hackers got ahold of the central bank’s keys and stole millions of dollars worth of crypto… FROM THE BANK! Only the users that FAILED to move their crypto into their own wallets ever lost anything.

DO NOT MAKE THAT MISTAKE!

Install the Electrum BitCoin wallet app on your PC. Below, is a video demonstrating the entire process.

There are MANY wallet apps for MANY cryptocurrencies. I created a website for decentralized apps and services and I’m adding more to it all the time. Here’s a (growing) list of cryptocurrency wallets. Electrum isn’t the only one.

Cryptocurrency Wallet Apps

BitCoin Just had its 2020 Halvening: Here’s what that means

What Happened?

Earlier today (2020-05-11), the amount of new BitCoins awarded to each minor that hits the jackpot of finding the right hash to validate the latest block of transactions now gets rewarded HALF the amount of BitCoin that they would have been awarded for each block mined for the last 4 years. For the last 4 years, up until earlier today, every block that was mined, 12.5 BitCoins were awarded to the miner that mined it. Now, and for the next 4 years, any minor that mines a block will be awarded only 6.25 BitCoins.

Why did that happen?

Creating new BitCoins is like printing money. It shouldn’t be done unless it has to because doing so floods the market with new coins and reduces the value of every coin already in existence. This is called “inflation”. But, the miners have to be incentivised to run their expensive hardware and burn through their expensive electricity, therefore, they are rewarded with a small amount of new coins. But, also built into the algorithm is a maximum limit of 21 million total BitCoins. There aren’t that many BitCoins yet, and this halvening algorithm is part of the reason why. By cutting in half, the reward, every 4 years (more specifically, every 210,000 blocks mined), it will take 144 or so years before the last BitCoin is mined.

What does this mean?

For miners, it means their income is cut in half… but only in the short term. BitCoin is deflationary by design, so the value of BitCoin has been and it is expected to continue to go up over time.

For consumers, it doesn’t mean much, at least not in the immediate future. The price of BitCoin has not been immediately effected by prior halvening events. For the most part, it should be business as usual.

For HODL’rs (people that Hold On for Dear Life… saving for the long term), it should reinforce the future value of their BitCoin.

For day traders, given prior halvenings that turned out to be non eventful, they probably won’t experience much of a difference either.

Conclusion:

For the most part, there’s more hype than action… every halvening, but the algorithm for the halvening is critically important for the long term viability of BitCoin.

What’s the best crypto-wallet for daily use?

Cryptocurrency is different than fiat money, as you probably already know.  But those differences make a HUGE impact on how you choose which wallet software to use.  And it’s all about control… YOUR control over your own money.

Let’s begin…

Rather than telling you which wallet apps are best, I’m going to lay out the features you need to look for in wallets, and the ones you need to DEMAND.  In other words, in the “demand” features, you should remove any wallet from consideration that does NOT have the complete “demand” list.  Other features, that may help, but are not deal breakers will be listed as “nice to haves”.  One of the reasons I’m not listing any wallets is because that would make this article dated eventually.  What I’m presenting here should be relevant for decades to come.

DEMAND

  1. Open Source:  If the software wallet you’re considering is NOT open source, then ditch it immediately!  Why?  Because open source wallets have no secrets.  Their entire source code is freely available for anyone to inspect, to guarantee there are no malicious intentions hidden behind the scenes.  Closed source wallets are a black box and you’re throwing out any chance of verification of honesty and relying SOLELY on the word of the wallet creator.  The whole point of cryptocurrency technology is that you DO NOT TRUST ANYONE ELSE WITH YOUR MONEY!  And that INCLUDES programmers… ESPECIALLY programmers!  And I say that AS A PROGRAMMER, MYSELF!
    1. Addendum:  Just because a wallet CLAIMS to be “open source”, doesn’t mean it IS.  For example, I could publish a closed source wallet and just CLAIM it’s “open source” and people would just believe it and download and use it, while I never publish the source code.  So, if some app CLAIMS it’s open source, DON’T BELIEVE THEM… EVER!  You go and FIND the source code (usually on https://gitlab.com or https://github.com) and verify the source code exists.  A reputable wallet author will also provide you a link to the source along with the binary to download.
    2. In addition to FINDING the source code, make sure you download the app FROM the source code repository’s binaries, NOT from an app store or anywhere else!
    3. If you’re a programmer, just download the source and compile it yourself and use THAT!  If you’re NOT a programmer, do #1.2 above.
  2. Must be an app that runs on your own hardware.  In other words, if it’s a website, then you’ve just completely obliterated the ENTIRE PURPOSE of cryptocurrency.  A website “wallet” is NOT a wallet.  It’s a BANK!  THEY are a centralized authority holding YOUR money.  By definition, if YOU are not in control of it, then it isn’t YOUR money, it’s THEIRS.  They ALLOW you to access it, until they DON’T!  Stay away from online wallets, with the brief exception of online exchanges where you EXCHANGE your cryptocurrency for fiat money or vice/versa.  But as SOON as you acquire crypto from an online exchange, you MOVE IT IMMEDIATELY into your OWN wallet!
    1. This means that you must DOWNLOAD an app (desktop or mobile).  And I recommend staying away from browser plugin wallets.  Browsers are just not a safe enough environment.
  3. Your keys or seed phrases are not transmitted over the internet FOR ANY REASON!  Your keys ARE your money!  Whomever holds they keys, holds and OWNS the money.  This is the very core and soul of cryptocurrency.  It’s its reason for being.  NO ONE other than YOU should EVER know your seed phrase or passwords… EVER!!!

NICE TO HAVES

  1. Easy to use user interface.  A lot of people mistakenly think this is a “demand” feature, but you’re better off with a klunky UI that puts you in control of your crypto rather than a sleek and polished wallet that doesn’t meet all the “demand” features.
  2. light vs full node.  What does this mean?  The most secure wallet will be one that’s ALSO a full node on the network for that cryptocurrency.  But to do that, it would need to download the ENTIRE blockchain for that cryptocurrency.  For a popular cryptocurrency, like #BitCoin, that would mean HUNDREDS OF GIGABYTES of data (eventually TERABYTES!) and hours or days of downloading, plus consuming all that space on your hard drive, forever.  It would also mean that your PC would be an actor in the BitCoin network, processing transactions.  That’s actually a GOOD thing for the network, but NOT a good thing for your local resources.  If all you’re looking for is a wallet, a full node is beyond overkill.  It’s like running a whole grocery store just because you need a refrigerator for your Milk.  I’m not discouraging you to NOT be a node.  By all means, PLEASE DO run a full node.  It helps the whole crypto community.  But, it’s not necessary for YOU if all you want is a wallet.  A “light” wallet is JUST a wallet, not a full node.  As such, light wallets are the only kinds of wallets that are available on mobile.  A full node requires a desktop PC, plugged into the electrical outlet.

Other Considerations

There’s another kind of wallet that I’m on the fence for at the moment, because it violates demand #1:  It’s NOT open source.  However, it has some other interesting security features.

The Samsung cryptocurrency wallet

I know I said I’m not going to recommend any specific wallet, and I maintain that.  I AM, however, going to TALK ABOUT one:  The Samsung cryptocurrency wallet meets all the other demand features, but it IS NOT OPEN SOURCE!  However, it has an important security feature no other software based wallets have.  That is, modern Samsung phones and tablets have a hardware based key store.  This is a special, isolated chip that can store encrypted versions of your cryptocurrency keys.  This hardware IS robust and is an important, core feature of the Samsung Knox (now known as “Samsung Secure Folder”) isolated security environment.  It’s the only mobile environment approved by the US Department of Defense for its employees.  Take that however you like.

What is Samsung Knox (or “Secure Folder”)?  You know how you enter a PIN or a password, or a pattern, or a fingerprint, or a face image to unlock your phone?  Well, on Samsung phones, you have all that, PLUS another, completely isolated, secure environment INSIDE of that.  It’s like a smartphone within a smartphone.  Once you set up “secure folder”, you get a SECOND smartphone environment, with another home screen and another set of apps.  Apps installed inside this secure area are NOT accessible to apps outside of it.  I personally install all my financial apps inside of this area.  My games and less sensitive apps and data are stored in the regular phone area.

Side note:  Whether you use the Samsung crypto wallet or not, you SHOULD install the mobile wallet you DO use inside the Samsung Secure Folder area on your phone (if you’re using a Samsung device).

The Samsung Cryptocurrency wallet is a software mobile wallet, and just like all other mobile wallets, it encrypts your seed phrase to your cryptocurrency with your password.  But the difference is that it stores that in the isolated, secure chip.  THAT makes it immensely more secure.  HOWEVER, the app is NOT open source!  Hence my hesitation of recommending this app.  We have no way to know what’s REALLY going on inside the Samsung wallet, because it’s closed source.

My Compromise:

So, here’s my recommendation:  If you DO use the Samsung wallet, never have more in it than you’d ever put in your real, physical wallet.  In other words, in the days when you’d have a wallet in your pocket with cash in it (you remember that right?  That green paper that you’d trade for stuff?), you’d rarely carry more than about $100, because that’s all you’d need for 1 day and it wouldn’t be the end of the world if you lost it or if it were stolen.

I recommend the same practice with the Samsung crypto wallet.  Only store about $100(USD) worth of crypto in your Samsung wallet.  If you run across a local place that accepts crypto, you can spend it, but if there’s ever any kind of a breach with Samsung’s OS and/or software, you’re not going to lose too much.

And I’ll give the same $100 limit advice for ALL OTHER mobile wallets too!  Store the remainder of your fortunes in multiple hardware wallets or multiple desktop wallets.

Conclusion

Cryptocurrency was created for the purpose of YOU being in control.  Therefore, it’s pointless to store your cryptocurrency in a place that you DO NOT control.  As always, don’t put all your eggs or cryptos in one basket.  Don’t put your life savings into your mobile wallet.

Addendum

Speaking of not putting all your eggs in one basket:  As you start accumulating more and more wealth in cryptocurrency, either by continuous investing or by the value of it rising, it’s smart to create more digital wallets and spreading your crypto among them.  Don’t store all your passwords and seed phrases in the same place.  Following these practices, if any of your wallets are ever compromised by your own failures to protect them, you won’t lose ALL of your assets.

In the comments below, tell us what wallets YOU use… THAT FIT THE DEMANDS listed here?  Please keep the conversation limited to those that fit the minimal demand list.

Cryptotab browser is a total SCAM!

What IS CryptoTab Browser?

It’s a custom and closed source web browser that has a built in BitCoin miner.  That means it’ll run high intensity calculations on your CPU, burning electricity with the intent of creating new BitCoin.  By closed source, that means they’re not open source.  They do NOT make their source code available for inspection.

What it CLAIMS

It claims to make you money by mining BitCoin on your computer while you browse.  But this is misleading.

What it ACTUALLY does

In reality, when you create your account, likely from having clicked someone’s referral link, you’re software is now a slave to the person who owns the referral link.  While your computer burns through electricity that YOU are paying for, it’s giving a large portion of the tiny amount of BitCoin that your computer generates to the other person, not producing any profit for you at all.  Even if you got to keep all of the BitCoin that you mined, you’d STILL be losing way more money than you make.

It’s IMPOSSIBLE to be profitable mining BitCoin on a PC or a mobile device

A very, very long time ago, the complexity of BitCoin became too powerful for PCs to mine it and be profitable.  For years, the only way to make a profit mining BitCoin is to buy specialized hardware that can’t do anything other than mine BitCoin.  Those hardware devices cast at least $1,300 (USD) on the low end, run very loudly and hot.  And you’ll have to run one for about 6 months before you generate enough BitCoin to break even on the cost of the hardware.  There is NO PATH to mining profitably on a PC (unless you get your electricity for free!)

If you mine on ANYTHING else, you’re GOING TO LOSE MONEY! Why? Because the amount of electricity you burn will cost you MORE than ANY infinitesimal amount of bitcoin you mine. Even if your electricity were free, the amount you can mine on a PC is virtually nothing. It also slows down your PC for everything else.

But wait! There’s MORE!  To make matters even WORSE, when you start mining with this browser, you don’t even get to keep all of the minimal amount of coin you mine. Even if you did, you’d already be at a loss, but it’s worse. Whoever’s link you clicked on to get the browser gets a portion of YOUR earnings! Earnings that are ALREADY in LOSS territory.

A Classic Ponzi Scheme

The ONLY way to “make money” with this is NOT by mining BitCoin, but by having LOTS of people sign up through your referral link.  THEY LOSE money by mining and lose even MORE by giving you the minuscule BitCoin THEY mine.

Stay away from CryptoTab Browser.

Samsung Blockchain Keystore “Couldn’t install app”

If you’re getting the “Couldn’t install app” error when trying to install the Samsung Blockchain Keystore app in your device’s Secure Folder, then read on.  Skip the background if you’re familiar with it and go straight to the Solution section.

Background

In mid-2019, Samsung came out with the Samsung Galaxy S10 phone.  At the same time, they introduced their first cryptocurrency wallet, the “Samsung Blockchain Wallet”.  At first, it only supported Ethereum.  But as of late 2019, it supports a few more cryptocurrencies, most notably, it now supports the most important one, Bitcoin!

But, to use the wallet app, it requires another app; the “Samsung Blockchain Keystore”.  I’m not sure why they separated that out into two apps, but my semi-educated guess is that you can create your keys and manage them in one app and use them in other apps, not JUST the wallet app.

Now, as anyone with any knowledge of cryptocurrencies knows, you have to be EXTRA careful with your keys for cryptocurrency.  YOU are 100% in control of your cryptocurrency.  If you’re careless, and it gets stolen, you have NO RECOURSE!  Unlike a traditional bank with FDIC insurance of up to $100,000 protection per account, there’s NOTHING for cryptocurrency.  That’s not a bug, that’s a feature!  With freedom, comes responsibility.  But that’s a speech for another day.  The point is, that if you’re going to do this on mobile, you want it to be a secure as possible, and on a Samsung phone, that means putting it in the ultra secure section called “Secure Folder”.  Now, let’s get back to the “Couldn’t install app” error.

Solution

Sorry to be the bearer of bad news, but there is no solution at the time of this writing (2020-01-04).  I spent an hour on chat support with Samsung, who then sent me to a phone tech support that’s a specialist on the Secure folder.  Both the chat tech and the Secure Folder tech were unaware of the problem and both confirmed that it is, indeed, a problem that they’re going to have to fix.

Here are the problems you’ll experience:

  1. When trying to install the Samsung Blockchain Keystore into the Samsung Secure Folder:
    1. It will not find it in the installed apps from the apps installed outside of the Secure Folder.
    2. It will not find it in the Play Store (to their surprise, it’s not in the Play Store at all.  You can search for it with a desktop browser.  It’s just not there).
    3. It WILL not find it in the Samsung Galaxy Store… at least, not directly.  First, you have to search for the Samsung Blockchain Wallet app, select it, scroll down for similar apps, and you’ll find the Samsung Blockchain Keystore down there.  Try to install it, and you’ll get the error:
    4. Installing the KeyStore app OUTSIDE of Secure Folder will NOT make it available to the wallet app INSIDE the secure folder.
    5. Even when installed outside of secure folder, it does not show up in the app drawer.  You cannot add its icon to the home screen.
    6. The ONLY way to launch it is to find it in the Galaxy Store and tap the “Open” button there.

So, the conclusion is that it’s not possible to use the Samsung Wallet app in the Secure Folder area.  And if you can’t use it in there, it’s not worth using.  You NEED the extra protection of the Secure Folder for your cryptocurrency.  DO NOT ATTEMPT TO USE IT OUTSIDE OF SECURE FOLDER!!!

Speaking of Decentralized Monetization,

If you like my work, you can contribute directly to me with the following cryptocurrencies (but, apparently, not with the Samsung Blockchain Wallet app in Secure Folder yet!)

BitCoin:

bc1qx6egntacpaqzvy95n90hgsu9ch68zx8wl0ydqg
bc1qx6egntacpaqzvy95n90hgsu9ch68zx8wl0ydqg

LiteCoin:

LXgiodbvY5jJCxc6o2hmkRF131npBUqq1r
LXgiodbvY5jJCxc6o2hmkRF131npBUqq1r

IRS Hell for BitCoin Users

Summary

2018 is the first year U.S. citizens have to file taxes on their cryptocurrency activities for 2017.  The limited “rules” the IRS has published do not cover the majority of types of activities and the information needed to accurately file taxes is simply not available to non programmers and is excruciatingly difficult to acquire, even for programmers.

Tax “Guidance”

In 2014, the IRS published a somewhat vague guidance on how to report cryptocurrency taxes.  It essentially boils down to:

  1. How much did you buy? 
  2. How much did you sell?
  3. What’s the difference?
  4. Send in 30% of your profits.
  5. Determine fair market value on the day of your transactions.

Here’s the actual 2014 IRS tax guidance document.

Reality

Unfortunately, reality is much more complicated than that.  Here are the real-world things that we have no clear rules on:

  1. What if I bought some prior to 2017?
  2. When I sell some, which of the MANY prior purchasing transactions do I apply the price to?  The price is different for every transaction.
  3. What about mining?
  4. What about mining hardware prices?
  5. What about price of electricity?
  6. I bought & sold on more than one exchange.
  7. I moved crypto between exchanges.
  8. I converted crypto from one to another.
  9. Prices at the moment of each transaction are not available when converting between currencies.
  10. Which price would we use, even if we had it?  There’s no universal price on any crypto.  Each exchange has its own, moving price that changes by the second.
  11. What about when a cryptocurrency forks, like BitCoin to BitCoinCASH and BitCoinGold?
  12. They say to use the fair market value of the day to determine prices on transactions, but that’s of no use since the price can swing thousands of dollars within a day.

My Experience

Since 2014, I’ve bought and sold crypto hundreds of times.  On some days, I’ve made dozens of trades in a single day.  In addition to that, I have accounts on 4 exchanges and also mine Ethereum.  I also traded between cryptos like converting BitCoin to LiteCoin and LiteCoin to Ethereum & Ripple & IOTA, etc., and moved crypto between exchanges like CoinBase, Kraken, Bitfinex, & Bittrex, and to and from my personal wallets,  and gained some crypto during forks, and lost some due to CoinBase not giving me my Ethereum Classic.

Over the past week, I’ve spent about 6-10 hours or so JUST on trying to gather what I understood would be needed for my tax accountant for cryptocurrency (not counting my usual taxes).  From the list above, you’ll get a rough idea of what I was going through to try to collect the information.

It’s 2018-03-31 and I finally finished my taxes.  Here’s how the day went:

I was woken up around 9:45 am this morning (I like to sleep late on Saturdays) by my tax accountant.  We spent a SOLID FIVE HOURS on the phone, trying to resolve everything (95% of that was related to cryptocurrencies).  This is their first year dealing with this.  I had to explain a lot about crypto and even the IRS’s rules.  She, apparently, had the same, uninformative PDF document from 2014 from the IRS too and just assumed it’d be as simple as they explain.  Reality is hugely different.

She wanted me to make it simple for her.  I wanted her to make it simple for ME.  That’s kind of why I’m paying her, right?  I spent hours gathering everything she could possibly need (minus the information that was just not feasible to get, but that we actually DO need).

It was simply not enough information, not just the lack of data that I didn’t have access to, but the lack of rules from the IRS.

Conclusion

The amount of effort trying to figure out just HOW to report my cryptocurrency transactions to the IRS was a nightmare and equals about the same amount of effort I spent throughout the year transacting and buying, learning, and setting up my Ethereum mining.  And it was significantly more frustrating than the actual crypto activities.

The IRS needs to get their act together, learn what it is we actually do, and come up with REALISTIC rules that we can actually perform.

After all the time and effort I spent preparing my taxes for my accounted, PLUS the amount of time we spent on the phone afterwords was insane and we STILL didn’t get everything.  We probably got about 85% of what was needed and I guarantee that what we reported was not right, but that was the best we could do.  I had tens of thousands of dollars in transactions.  With the limited information we had, she simply ended up using what I sent to her from the website CoinTracking.com, which is ONLY good for a SINGLE exchange.  So, I reported a $200 profit and paid taxes on that.  At least that is small, to keep my taxes down AND shows a “profit”, which should keep the IRS off my back, since I’m actually paying them something.  I was told that if I reported a loss, it would likely trigger an audit.

What?  Were you hoping to come here for a resolution to YOUR tax problems?  Sorry.  All I can offer is comfort that you’re not alone.  The IRS needs to get their act together and YOU need to click this link to contact your U.S. representative and explain to them the nightmare they’ve created for us.  Click the following link:

Find Your Representative

 

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Check back later for updates too!

Encrypting Degoo Cloud Drive With Cryptomator

In this article in my series of “Encrypt All The Things!”, I’ll show you the specifics of encrypting a cloud drive using the Degoo.com cloud drive service. For a generic overview, that’s not Degoo specific, see:

If you use cloud drive services, of any kind, it’s critical that you do so ONLY with data that YOU have encrypted on YOUR END and that YOU are in control of the keys. Any service that handles the keys for you is NOT SECURE! The ONLY way your own data is secure is if YOU are in control of the keys. Some cloud drive services offer encryption at an extra price, which is crazy because you can do it FOR FREE with the added benefit of YOU being in control, NOT THEM!

The best way to ensure that you’re in control is for you to do the encryption yourself with software NOT provided by your cloud drive service.

In this article, I’ll show exactly how to do this with a commercial cloud drive service called Degoo.com and a free and open source encryption application called Cryptomator.

Create a Degoo account and install the software

First, you’ll need to sign up for the Degoo.com cloud drive service here.

100 GB Free Backup

Be sure to download and install the software. Don’t set up the download or sync folders yet. We need to get the encryption app installed first. BTW, Degoo has both free and paid options.

Install the Encryption App

Go to Cryptomator.org and download and install the software (It’s free and open source!). Once installed, you’ll need to setup one or more “vaults”, which are simply nothing more than a folder on your hard drive where encrypted files will be stored.

Set up a Cryptomator vault

First, you need to understand how Cryptomator works. DO NOT SKIP THIS!

The first time you run it, you will not have any vaults (encrypted folders). First, create a new folder on your drive in whatever way suits you best. This is where you’re going to have encrypted versions of your sync files stored.

  1. Click the “+” sign in the lower left and choose “Create New Vault” to create a vault.
  2. Navigate to the folder you want to store your encrypted files (the folder should be blank, right now) and give it a name, here I Cryptomator.
  3. Then create a password for it. DO NOT FORGET THE PASSWORD OR YOUR DATA WILL BE LOST FOREVER!!!!!
    1. I Highly recommend saving it in a password manager like LastPass.com. I also recommend using that password manager’s password generator to generate a long, random password for you.
  4. Create the Vault by clicking the “Create Vault” button. This stores a couple of small files in there that cryptomator needs.
    You’ll be prompted for the password again. This is not part of the vault creation process. You’re done. Now you’re ready to use it like you will everyday. Now you unlock the vault by entering your password.
  5. Click the “more options” button to see what you have available. Those options are pretty self-explanatory. I’ll skip those and let you choose how you want to configure it.

Your vault is now unlocked and is opened in a Windows Explorer window, usually as drive letter Z:.

The real folder on the real drive is here (below) (depending on where YOU chose to create it… this one is mine):

Now, I can store files in my Z: drive (as long as my vault is unlocked) and I can use any apps I want to read and write to the Z: drive. Everything works normally. Apps that read and write there have NO IDEA that they’re reading and writing to an encrypted folder.

You’ll notice that in Documents\deleteme\test (again, that’s where I created mine; yours will be where ever you put yours), you’ll see a “d” folder and 2 masterkey files. Those masterkey files have an ENCRYPTED version of your key. No one can decrypt it without knowing YOUR password that you just created.  This masterkey file WILL BE ON THE REMOTE SERVER, so this is why you need a STRONG password, preferably random characters generated by a password manager.

As you save more files into your Z: drive, you’ll see more files show up somewhere under Documents\deleteme\test (again, MY folder is here, YOURS is where ever you put yours). The files that show up here have unreadable filenames and if you try to open them, they will have what appears to be garbage in them. These are the files you stored in your Z: drive, but these are encrypted.

Think of your Cryptomator unlocked vault Z: drive as a decrypted, magic window into your physical, encrypted files stored in their encrypted state in your Documents\deleteme\test (again, MY folder name I chose, YOURS will be different).

One caveate: Files in your Z-Drive CANNOT be larger than 2GB! That’s a limitation with the current version of Cryptomator.

I created a text file in my new Z: drive. As you can see below, Cryptomator created a file in the Documents\deleteme\test\d\WQ folder with a funky name. That’s what’s REALLY stored on my REAL hard drive. If I try to open the funky named file, it looks like garbage bytes. Both of those windows are showing the SAME data, it’s just that the REAL data is encrypted (top window). The bottom window is a VIRTUAL drive with an decrypted view of the data. ALWAYS remember this! You will NOT back up your Z drive! EVER! You’ll back up and/or sync your Documents\deleteme\test folder. More on that later.

Now, how to sync your encrypted files with Degoo.com

Now that you have a folder that contains your encrypted files and an easy way to use the the encrypted files (your cryptomator Z-drive), you need to sync the encrypted files to your Degoo.com account. DO NOT SYNC OR BACK UP YOUR Z: DRIVE!!!!!!

  • If you haven’t already, download and install the software on Degoo.com and create an account.
  • When you open it, click on the “Choose what to backup” tab. The actual folders on disk that are being backed up are each in their own cryptomator vault folder with encrypted files.
  • Click the “Add folder to backup…” button and navigate to your Cryptomator vault folder… the one with the unreadable encrypted files NOT YOUR Z-DRIVE!!!! and click “Add folder to backup”
  • Your folder will be added to your list of folders to be backed up.

Now, you’re all set. Anything you put into your Z-Drive is automatically encrypted at the time it’s written and since the real folder with the encrypted files is the one that’s backed up, you automatically get your data backed up in addition to automatically encrypted. Now, no matter how malicious anyone at Degoo may be (I have to reason to believe the are (or aren’t)), your privacy is safe. They cannot see anything other than what you see when looking at the encrypted version of your folder. Unless they have your password to your vault (which, of course, should be DIFFERENT from your Degoo password), they’ll never be able to see the contents.

But that was hard!

No it wasn’t! And, the small amount of work you did above is only done when creating a new vault and installing everything for the first time. Once it’s done, here’s all you need to do moving forward:

  • Turn on your PC and log into Windows (or Mac or Linux)
  • Start Cryptomator and unlock your vault.

That’s it! You can even shorten that to not have to start cryptomator setting up your vault to save your password and auto-unlock on start.

You can also add more cryptomator vaults at any time.

Quick review:

In this tutorial you did the following simple steps:

  • Signed up with and installed Degoo.
  • Downloaded and installed Cryptomator.
  • Created a vault with Cryptomator.
  • Told Degoo to sync the encrypted version of your cryptomator vault.

That’s really all you did. And now, you’re protected both with encryption and with an automatic, encrypted backup.

What’s Next?

Just continue to use your computer with your Z-Drive as your unencrypted version of your data. You can even lock your vault and Degoo will continue to back up your data. Degoo doesn’t need you to have it unlocked because it’s NOT backing up the unencrypted files. It’s only backing up the encrypted bits.  Degoo isn’t even aware of the Cryptomator software.  From Degoo’s software’s point of view, all that matters is that folder with the encrypted files in it.

Conversely, the Cryptomator software is unaware of Degoo.  All Cryptomator knows is that you have a folder with encrypted files and it provides the means to unlock and use them.

You can create more vaults with Cryptomator, if you like and add them to Degoo as well.

You can create vaults inside your Google Drive sync folder, your Microsoft One-Drive sync folder, your DropBox sync folder, etc, etc… As many or as few as you want.  Cryptomator works by encrypting any folder and providing an unencrypted view of it.  Cloud drives work by backing up and/or syncing a folder.  Put the two of them together and you’ve got a robust and secure backup strategy.

I do strongly recommend you make a cryptomator vault in EVERY cloud drive sync folder and move all your non-encrypted files INTO your virtual drive letter created for that vault.

WARNINGS!

You MUST obey the following rules!!!

  • Don’t write files directly into your real folder that contains the encrypted files. If you do that, it will be backed up AS-IS… WITHOUT ENCRYPTION!
  • Do NOT backup your Z: drive (or whatever drive letter cryptomator makes for you). That is DECRYTPED and if you back THAT up, you’ve wasted all your time and effort and are NOT storing an encrypted version of your files. Your Z: drive should ONLY be used for your normal work. DO NOT BACK IT UP!!!!

You are, of course, free to break these rules, but your secure backup is not going to be encrypted if you do break them.

Is BitCoin Legitimate?

(Image credit coindesk.com)

It’s time to correct some misunderstandings about BitCoin.

I was interested in BitCoin and read about it, but one can only learn so much without actual experience, so I dove in and bought some BitCoin, did some mining, gave some BitCoin to my kids, and bought and sold BitCoin over the last year.

What I learned

  1. It’s absolutely, positively not a pyramid scheme. I know pyramid schemes. Pyramid schemes were a friend of mine, and you, BitCoin, are no pyramid scheme.
  2. BitCoin is not centrally located, is user supported, and cannot be shutdown by this or any other government, similar to Tor or bittorrent.
  3. It’s draw is that it is NOT controlled by a central authority like a government or Google.
  4. Everything costs money. Transactions have to be processed and that costs money, but BitCoin transactions are crazy cheap.
  5. 100% of every BitCoin transaction that’s ever taken place has been tracked and is a permanent part of the BitCoin block chain.
  6. Just as cash is not taxed, neither is BitCoin. But BitCoin purchases are no different than cash purchases. They are taxed unless the buyer and the seller agree to not report the transaction. But, the buyer usually has a tax incentive to report the purchase for income tax reasons. Same as cash.
  7. BitCoin is not a tax free paradise.
  8. BitCoin is not an illegal transaction paradise. Cash has no circulation ledger history. BitCoin has a complete and total transaction ledger and history.
  9. Illegal transactions happen in all markets, in all countries, in all currencies, including BitCoin, but only BitCoin has a complete and total history of every single transaction.

Responding to claims that it’s a pyramid scheme, anonymous, you don’t know who promotes it  nor how much BitCoin they have, and that BitCoin has no value, and that only scammers, drug dealers, and hackers use it…

A pyramid scheme works with or without anonymity. As such, anonymity is not a requirement for a pyramid scheme.
A pyramid scheme is when a smaller number of people at the top of the  scheme make money only as larger numbers of newer recruits pay in. Drawing this relationship and hierarchy on paper looks like a triangle, hence the term “pyramid”.  And since the only way people get paid in a pyramid scheme is by larger numbers of recruits, mathematically, that scheme is doomed to failure because after only a couple dozen recruit layers pass, the new numbers needed to keep it going become larger than the human population. That is not BitCoin.

A single BitCoin is an answer to an extremely complicated mathematical formula that takes an ordinary home PC more than a year to compute at full CPU speed. As such, they cannot be counterfeited.

There will only ever be 22 million BitCoins in existence. Their value is on their limited numbers and work involved to be mined.

Promoters of BitCoin are not anonymous. The creator is, but that has no bearing on the existing, known community that supports it. Coinbase, CoinDesk, etc are not anonymous entities.

Everyone that buys BitCoin usually buys it from a known entity, such as the ones I listed above. But what’s cool about BitCoin, is that you CAN buy BitCoin from some anonymous entity SAFELY. That’s the beauty of it. The worldwide BitCoin network validates the BitCoin you’re purchasing is valid, has not been already spent, and that it has successfully been transferred into your wallet. You can safely buy BitCoin in a back alley, with cash, in a foreign land, at night, while naked, if you prefer. 🙂

No one needs to know how much BitCoin the person or entity you’re transacting with has. But, if you want to know, that’s public knowledge too. It’s all in the public, permanent BlockChain. All you need to know is their wallet address. You see 100% of every transaction on that wallet. And to do any transaction, you do need to know that wallet address. So it’s all out in the open.

BitCoin, like fiat currency has no intrinsic value. Both currencies have value in them as their users see fit. Since BitCoin sells for real money by real people in a real society, by definition, society has indeed placed a value on BitCoin. At the moment, that’s $402.38.

Scammers, drug dealers and hackers are and have been using cash too. That has no bearing on the fact that we can and do legitimately use cash, just as we legitimately use BitCoin.

The EU court, just the other day, officially ruled BitCoin as a currency. Big credit cards are getting into it. More and more major retailers are accepting it like Amazon gift cards and http://overstock.com.

What can I buy with BitCoin?

It’s real, has value, is safe, is 100% recorded in the BlockChain.
I hope this has provided you with useful information.

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Today’s best hard drive prices

This pricing data was collected on 2015/03/15 from Newegg.com.  I filtered by 3.5” drives and by each capacity they offered, sorted by lowest price, and have listed the lowest price drive in each capacity offered.  I’ve put them in a spreadsheet and added a column showing the price per TerraByte, and sorted by that.  This will give you the absolute best deal (best if price per TB is your main criteria) as the first drive listed and the worst price at the bottom of the list.

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Here’s how to put your mind at ease to ensure you’re getting the best price on hard drives:

Hard drive prices change daily, so the actual price data I’m showing here is only relevant for a month, at best.  So use the technique in the linked article above to find your best prices from your favorite store at the time you need it.

Here’s a readable screenshot of today’s best prices per capacity available on Newegg.com:

image

The following is not as readable, but at least the links are clickable, unlike the image above.

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$29.44    <– Min Price/TB       
Price/TB    TB    Price    Link
$29.44    2    $58.88    http://www.newegg.com/Product/Product.aspx?Item=9SIA5AD2M15415
$30.00    3    $89.99    http://www.newegg.com/Product/Product.aspx?Item=N82E16822236098
$35.00    4    $139.99    http://www.newegg.com/Product/Product.aspx?Item=N82E16822178338
$37.50    8    $299.99    http://www.newegg.com/Product/Product.aspx?Item=N82E16822178748
$39.00    5    $194.99    http://www.newegg.com/Product/Product.aspx?Item=N82E16822178752
$41.50    6    $248.99    http://www.newegg.com/Product/Product.aspx?Item=N82E16822236797
$46.95    1    $46.95    http://www.newegg.com/Product/Product.aspx?Item=9SIA5AD2N65236
$51.93    0.75    $38.95    http://www.newegg.com/Product/Product.aspx?Item=9SIA5AD2HS9891
$59.99    1.5    $89.99    http://www.newegg.com/Product/Product.aspx?Item=N82E16822236883
$71.98    0.5    $35.99    http://www.newegg.com/Product/Product.aspx?Item=N82E16822148787
$75.38    2.5    $188.45    http://www.newegg.com/Product/Product.aspx?Item=9SIA0AJ1N07310
$130.39    0.64    $83.45    http://www.newegg.com/Product/Product.aspx?Item=9SIA0AJ1MP2002
$144.19    12    $1,730.23    http://www.newegg.com/Product/Product.aspx?Item=9SIA24G1E34379
$166.65    0.6    $99.99    http://www.newegg.com/Product/Product.aspx?Item=N82E16822178479
$175.50    0.8085    $141.89    http://www.newegg.com/Product/Product.aspx?Item=9SIA67S23Y8983
$416.58    1.2    $499.89    http://www.newegg.com/Product/Product.aspx?Item=9SIA67S2709964
$472.29    1.8    $850.12    http://www.newegg.com/Product/Product.aspx?Item=9SIA24G2NU4473
$568.83    0.9    $511.95    http://www.newegg.com/Product/Product.aspx?Item=9SIA75M2FX7519

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Dragon Touch Tablet–High End Hardware–Low End Price

DragonTouchTablet

This is going to be a quick and short review.  The Dragon Touch 9.7” Android tablet by TabletExpress (as U.S. company) has fairly high hardware specs considering its low price of $179.99.  Most tablets that size are much more expensive.  But, it’s not just a 9.7” screen tablet, it also has a ridiculously high resolution of 2048×1536 (again, hi res for that price).  It also sports a Rockchips RK3188 Quad Core Cortex A9 CPU at 1.8Ghz per core.

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Here are the specs:

  • 9.7” screen
  • 2,048×1,536 pixels “Retina” display
  • Rockchips RK3188 Quad Core Cortex A9 CPU at 1.8Ghz per core
  • Front and rear cameras
  • Bluetooth 4.0
  • MicroUSB port (data only, not for charging)
  • HDMI port
  • Headphone jack
  • SD card slot, up to 64GB
  • 12v DC proprietary adapter
  • Android 4.2 Jelly Bean
  • 16GB internal storage
  • 2GB RAM
  • Wifi

Here’s an unboxing of it:

https://www.youtube.com/watch?v=6xZP8B3V46k

The Good:

  • 9.7” screen
  • 2,048×1,536 pixels “Retina” display
  • Rockchips RK3188 Quad Core Cortex A9 CPU at 1.8Ghz per core
  • MicroUSB port (data only, not for charging)
  • HDMI port
  • SD card slot, up to 64GB
  • Screen Protector

Remember, this “goodness” is all based on getting this for $179.99.

You almost never see a screen larger than 7 inches for this price.  Remember, the Nexus 7 is only 7 inches, only has a resolution of 1920×1200, same amount of RAM and internal storage, and is only 1.5Ghz and NO SD card slot for expandability and IT costs $229.  Hardware wise, this thing kicks butt, especially for the price.

That screen resolution of 2,048 x 1,536 is insanely high for such a cheap tablet.  Even many more expensive tablets don’t even have that resolution.

The processor is a fairly fast Quad Core with a higher clock speed than what you get with the much more expensive (and small) Nexus 7.

It has an HDMI port so you can view it directly on your computer monitor or HDTV.  That can turn it into a game console or a cheap way to show the family photos and videos while on the go or to give presentations.

The Micro USB port is both a pro and a con.  Since we’re in the “Good” section, let’s focus on the good.  This is pretty standard on Android devices and any device without a MicroUSB port would be a joke.

It comes with 2GB of RAM and 8, 16, or 32GB of storage.  I’m reviewing the 16GB version here.  It also has a Micro SD card slot so you can add up to 64GB of more storage.  “Officially” it supports up to 32GB, but reviews on Amazon.com say that 64GB cards do indeed work.

The build quality is pretty robust too.  It doesn’t feel like a light piece of plastic.  This thing is solid.

It also comes with a screen protector already installed for you!

Google Play:

Yes!  This tablet has all the Google Goodness, including the Google Play store.  I do have to mention this because many tablets in this price range do NOT have any of the Google software and lack the Google Play store.

The Bad:

  • Front and rear cameras
  • MicroUSB port (data only, not for charging)
  • 12v DC proprietary adapter
  • Android 4.2 Jelly Bean

Let me first say that the good outweighs the bad.  I highly recommend this tablet.

BUT!  It’s not perfect.  For example, the front and rear cameras are both only 2 megapixels and the quality is not that great.  So, you’re not going to use this for keepsake photos and videos, but it’s good enough for scanning barcodes and doing video chats.

The MicroUSB port does NOT charge the device!  This is a pretty important thing to note because to charge it, you have to use their supplied, proprietary charger with a  very short 2 foot cord.

Also, the OS is not the latest.  It comes preinstalled with Android 4.2 Jellybean.  Today’s version of Android is 4.4.4 Kit Kat and the next major release, code named “Android L” is just around the corner.  I can’t confirm this, but rumors are that there will be no updates for this.  BUT, Jelly Bean 4.2 is a robust and powerful version of Android and as long as you update Google Play Services from the Google Play store, you’re going to get most of the important updates from Google.

In spite of the powerful hardware, it’s quite laggy and choppy.  My wife hasn’t complained, but my son noticed and I noticed and the reviewers on Amazon noticed.  Read below on “Make it better” for a fix.

The Box Contents:

There’s absolutely no paperwork or manuals in the box.  You get the tablet, the charger, a Micro USB to standard USB (PC to tablet) cable, and a USB PC female adapter cable.  I mean, one end plugs into the MicroUSB data port on your tablet and the other end is an open USB female port so you can plug in things like PC mice, keyboards, and external hard drives.

Make it Better:

For the technically capable… You can root this tablet with TPSparkyRoot.  Once rooted, you can then flash an alternative firmware (more commonly mislabeled as a “ROM”) and reports are that it makes this thing liquid smooth, like butter.

Conclusion:

For the money, you’ll have a really hard time finding this much bang for the buck.  With the screen resolution so high, and a decent enough size screen, you can even remote control your high-end desktop PCs with it.   –>Get it here<–