How to buy EOS - for people who have barely heard of Bitcoin or Blockchain

image from unsplash.com - h heyerlein / Rheinfelden, Germany

This guide is for people who have yet to take the plunge into the fascinating world of Bitcoin and Blockchains, yet are interested in becoming a part of the EOS distribution list, perhaps for it's monumental potential, though they have no idea where to start.

I am putting this guide together in response to repeated requests for information about how to get EOS but it in no way constitutes investment advice. Blockchains are a very new technology and extremely risky. Before anyone becomes financially involved in Blockchain technology, it is essential to do considerable due diligence. Even then there are considerable risks.

Key things to understand

You are responsible for the security of your tokens. There is virtually NO RECOURSE for resolving issues like forgotten passwords or weak passwords that can be stolen. If a password is compromised, it is a trivial matter for the thief to gain access to your private keys and your funds. So ensure passwords are very strong and very safe.

A private key is a code that acts like your signature when you send transactions across the network. They enable the network of databases to keep up to date with who owns what and prevents the transaction from being altered in transit. If someone had your private keys, they could steal your tokens so it is important to keep them secret and safe.

Step by Step

1. Acquire Bitcoin

There are many ways to acquire Bitcoin, some require creating exchange accounts and providing personal information to satisfy KYC regulations placed upon the exchange.

Here I will suggest an ESCROW service provided by localbitcoins.com that enables buyers and sellers of Bitcoin to make contact and trade remotely or in person. I would only be happy trading remotely. Sellers of Bitcoin will place advertisements that include a range of amounts they are willing to trade, for what price and method of currency transfer. It is important to review the reputation of the person you choose to trade with and sellers may place restrictions on new buyers without a high reputation score.

When you first decide to initiate a trade, ensure you have some time to commit to the process and you have access to the service or your email so that you can follow progress and initiate steps. It can be a very fast, the entire process taking minutes, or it can take a few hours, rarely even longer. The differences in process time depends on several factors, the responsiveness of the two parties, the method of currency transfer and in the case of national bank transfers, the responsiveness of both parties banks. For people with reasonable banks who select sellers with excellent reputations, national bank transfers can be a very swift and painless trading experience. Once a trade is initiated, the localbitcoins.com service will hold the seller's Bitcoin in ESCROW until they report that they have received your currency into their bank account and localbitcoins.com will release the Bitcoin into your localbitcoins.com wallet.

Create an account with localbitcoins.com and once you have Bitcoin in your wallet, you are ready for the next step......

2. Send your Bitcoin to an Exchange

There are currently two methods for joining the future EOS distribution/s. Both methods presently involve acquiring EOS ERC20 contract tokens on the ETHEREUM blockchain. The EOS blockchain and network is presently under development and therefore does not yet exist. The ERC20 smart contract is being used to create a distribution list for future EOS token distribution and potentially other tokens within the EOS dapp network. One of the reasons for doing it this way (over a year, with development occurring in parallel) is to ensure the developers are in no danger of breaking compliance with the law, to ensure equal opportunity to acquire ERC20/EOS and to enable the free market to discover the value of the ERC20 distribution as it occurs.

Option a)

Send your Bitcoin to an exchange in order to purchase Ethereum for sending directly to the ERC20 smart contract. The distribution works like a blind auction with 2 million tokens per day available to be shared among all those who contribute Ethereum to the contract in proportion to the relative size of their contribution.

For the purposes of this guide, the exchange I will use is bitfinex.com

Create an account on bitfinex.com

Send your Bitcoin from your localbitcoins wallet to your bitfinex EXCHANGE wallet. You do this by requesting a DEPOSIT ADDRESS FOR BITCOIN from your bitfinex exchange account, copying that address and inserting it into the SEND

Once your Bitcoin has reached your bitfinex exchange account, you will need to wait a while for the Bitcoin network to confirm the transaction. Once the transaction has been confirmed and your Bitcoin is available, open the Bitcoin/Ethereum market and buy Etheruem with your Bitcoin.

For the next step you will need an Ethereum wallet.....at this point it would be most sensible to open eos.io and follow the instructions for participation with the distribution.

Select TOKENS

Read everything & select GET EOS

Read everything, agree to the conditions & select CONTINUE

When the next web page opens, read everything and make your way down to 'Recommended Configuration'

So you need Google, Metamask (an Ethereum wallet) and the EOS TOKEN DISTRIBUTION APP which is built into the eos.io website.

Select METAMASK WALLET to install it

Once Metamask is installed, make a copy of your public receiving address and go back to bitfinex

Withdraw your Ethereum to your Metamask public receiving address (this may take some time, sometimes a few hours)

Once you can see your Ethereum in your Metamask wallet and the network has confirmed them, you are ready to send Ethereum to the ERC20 contract via the EOS TOKEN DISTRIBUTION APP

Select EOS TOKEN DISTRIBUTION APP

at this point you may experience difficulties with the app, it may not run due to the Ethereum network being under strain, issues with the servers through which you are attempting to connect or the app and/or Ethereum network being under attack. The closer to the end of a distribution round, the more likely you are to have issues. Either be patient and keep trying, wait until the start of a new distribution period or see option b.

By selecting GET EOS TOKENS you will be able to send Ethereum from your Metamask wallet to the current distribution period. Information about the current distribution period will be displayed in the distribution app. Once you initiate a SEND, your Metamask wallet will require you to configure the transaction fees (utilising some of your Ethereum as GAS) and then confirm the transaction. There are many factors which determine how much GAS is appropriate and how much of a fee you are prepared to pay. Metamask should show you the dollar equivalent so you can decide for yourself. Again, picking times when the Ethereum network is experiencing less traffic and duress will enable you to keep the transaction cost lower.

If you are happy to keep your ERC2O distribution record within the EOS distribution app then the only thing you need to do before the end of the year and end of the distribution is register your keys. You can do it any time by selecting the top right hand button in the distribution app (mine says CHANGE YOUR EOS KEY as I have already registered.)

If you want to claim your tokens, select CLAIM EOS TOKENS, after which you will be able to TRANSFER EOS TOKEN to an exchange of your choice....possibly bitfinex.

Option b)

If we go back to the point at which you had just recieved your Bitcoin into your bitfinex exchange account, instead of going to the Bitcoin/Ethereum market, you can go to the Bitcoin/EOS market instead and exchange your Bitcoin dirrectly for ERC20 EOS.

*it is worth considering that holding your ERC20 EOS on a centralised exchange for a year may not be the best choice from a security standpoint. On a centralised exchange, your balances are actually IOU's whilst the exchange holds the actual tokens. There are many risks associated with that fact. Though to date, bitfinex has a good record as far as I am aware.

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If you would like to follow the progress of the distribution without opening the distribution app, take a look at eosscan.io

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I hope you find this guide and useful. I have made some assumptions about the ability to; create accounts, install software, navigate the basic functionality of an exchange and deposit and withdraw funds. Generally if you take your time and ensure you have a solid process for recording and storing critical security information, this should be enough to get you going. Having said that, we can all use a little help from our friends so I fully expect some of my friends who are interested to get stuck and get back to me......frequently :)

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Happy Steeming