Bitcoin, Ether, and DAO Oh My! Part 2
We return to our heroes deep in their quest to buy DAO (or bitcoin, or just reading stuff on the internet to justify their curiosity, no judgement).
What’s next?
So you deposit some money in your account what’s next? You buy DAO with something called ether. It’s the cryptocurrency of the Ethereum platform. So your first thought might be that you want to go to BTC then get your ether right? That’s what I did, and I would recommend against it. You cannot trade BTC for ether on your exchange. However you can trade fiat currency for it. You take a little hit whenever you convert currency to crypto-currency, and when you exchange crypto-currency for another. It’s not a lot, but it adds up if you keep doing it, also if you’re talking about a bit of money 3%-7% is probably more than you’d care to just throw away on bad planning. So you can buy your ether, then you’re going transfer it to your ethereum wallet. Here is a bit of a digression. I’m going to go over how to convert your BTC to ether for the people that either already have some BTC, or made the mistake (like I did) of not going straight to ether. If you haven’t bought the bitcoin then I would recommend just buying the ether directly from an exchange then transferring it to your wallet, although the wallet setup for Ethereum is the same regardless.
Ethereum Wallet
So you want to get the Ethereum wallet to do your DAO transactions all according to plan right? Great! If you’re based in the USA it’s probably not going to be a huge problem. However if you’re overseas, or in an area that either doesn’t have great internet or a lot of people around with an ethereum wallet you’re going to have issues. I spent about two days trying to get my ethereum wallet to sync. I have a couple of tips though to make it easier.
Installation
Go here to download the newest version of the Ethereum Mist Wallet. Download the version for your system. I’m going to assume that people are mostly on Windows. If people want a mac version of the walkthrough let me know and I’ll add it, although I don’t have a mac currently so it won’t have a ton of screenshots or anything. The syntax for the commands should be the same (since they’re using Go as a language), although the paths to the stuff won’t be. If linux users want a walkthrough I can do that as well.
Unzip the wallet, then open up the Ethereum Wallet executable. If you’re in the USA and have good internet you’re probably OK. However it’s going to take a long time. The wallet is downloading a full version of the Ethereum blockchain, and on my system that is currently taking up 18.7GB of data. If you want it a bit quicker and you’re on a new install of Ethereum you can do it quicker. Yay! Although you need to do a bit in the command line. So open up your command line/terminal (on mac) and navigate to the folder where your Ethereum wallet is. Then go into /resources/node/geth. Geth is a command line version of the wallet. What we’re going to do is use it to use the fast sync option. So put in
geth --fast.
This will do a quicker download of the whole blockchain. However it will only work if you have an empty chaindata folder. If you don’t then run
get removedb
Then confirm that you want to remove the DB. This will still take many hours though. What I had to do was run it on a VPS instance I run in San Francisco (I installed it first of course). Then exported the whole blockchain
geth export chaindata.bin
Then gzip it and SFTP it over to my laptop in sunny Sunshine Coast. You have no idea if you’re on good internet how low the timeout periods are on some stuff.
Buying DAO with Ether
So you have your wallet right? Pretty easy right? No? Well too bad, now you have to buy your DAO.
So we’re going to go in and buy your DAO. Open up your Ethereum wallet and let it sync, it might take a couple of minutes. Now you can either use the default wallet, or create a new one. I would create a new one if I were you. Create a strong password for it. A short snippet of a quote that you’re familiar with is good, include the punctuation and capitalization.
Now we’re going to back up your wallet. So go to Accounts -> Backup -> Application Data along the top menu. Then backup the folder in there. If you ever make a new Mist wallet install you just need to copy these folders back into here for a new install. I created an encypted .7z file (7-zip) to keep them in, but you might not be as paranoid as me. So now we’re going to get ether with Bitcoin. If you bought ether on an exchange you can just send it to your wallet address now. Click deposit ether using bitcoin. You’ll need to specify the transfer you want. I am also going to save you something that took DAYS to sort out. Make sure when you’re transferring bitcoin that you go abou .1BTC below the max deposit/deposit limit whichever is lower. If you go over you have to contact Shapeshift.io and get them to sort it out. Although their customer service was awesome and sorted me out every time. So now you have some ether right? Settle down, we’re almost done.
Buying DAO
So when the DAO started you got DAO by sending Ether to an address on DAOhub. I don’t think that’s how you’d get it today, but we’ll go on with it. So DAO is shown entirely by the ether wallet address that you have. You can put in your ether wallet address on DAOHub and you can see your balance. Make sure you have the right address! You can’t generally get your ether/bitcoin back from people. If you include a refund address and you send it somewhere bogus then I believe it will go back to you eventually.
Conclusion
I learned a lot taking care of this, and am now setup to get crypto-currencies whenever I want. That’s pretty nice. It was a bit of a headache though. I’m not sure I’d recommend it to people, I do prefer transferring bitcoin to my friends to settle up checks and bartabs as opposed to using Paypal or Venmo, or that Square service I couldn’t get anybody I know to use. It’s also international which I like. I also like being able to put some of my cash in Coinbase so that if the dollar tanks I’m not screwed.
Have any other questions? Had some issues yourself? Put it in the comments you wonderful person you.