The student workbook, page for page, with the answers in red ink and yellow notes on what to anticipate. This is the hands-on module: acquiring, wallets, self-custody, setting up a mobile wallet, sending and receiving, and "Don't Trust, Verify." Make the seed phrase the centerpiece. Reveal every ink, check every page, and you have hit everything.
Hard Money Diploma · Student WorkbookModule 06 · How to Use Bitcoin
Guide: 8 minPlan 8
6.0 Introduction
Why would anyone trust nerd money vs. central bank money? Nerds brought you the internet. Banks brought you the Great Depression.
Satoshi Nakamoto
Now that we have a better understanding of what bitcoin is and its purpose, it's time to learn how to use it in practice. In this module, we'll guide you through the process of acquiring bitcoin step-by-step, explore the various types of wallets available, help you set up your own Bitcoin wallet, and even practice sending and tracking a Bitcoin transaction on the network. It's time to apply your understanding in action!
✒ TEACHER: open by connecting to the previous module
Ask first, then wait: "If Bitcoin is money, how do people actually get and use it?" and "What does it mean to truly control your bitcoin?" 6.0
Clarify that this chapter is about practical use: students are no longer only learning what Bitcoin is, they are learning how to interact with it directly 6.0
Frame the module: acquire, choose a wallet, set one up, send and receive, and verify for yourself 6.0
ANTICIPATE
Myth to expect: "using Bitcoin is just like using a bank app." No: with self-custody you hold the keys, there is no company to call, and no one can freeze or reverse the transaction for you.
The Satoshi line is playful, not a promise. Use it to set the tone: this module turns theory into direct action, it does not predict prices.
Teacher's Edition6.0 •
Hard Money Diploma · Student WorkbookModule 06 · How to Use Bitcoin
Guide: part of 12Plan 6 to 7
6.1 Acquiring Bitcoin
There are many ways to acquire and exchange bitcoin. For example, you can:
Get paid in bitcoin in exchange for your work and pay for other people's products and services with bitcoin (more on that in Module 7)
Mine bitcoin (more on that in Module 9)
Exchange your fiat currency for bitcoin or exchange your bitcoin for fiat in person.
Exchange your fiat currency for bitcoin or exchange your bitcoin for fiat online.
Below, we'll explore exchanging fiat currency for bitcoin and vice versa, through both in-person and online methods, as they are the most common options.
Peer-to-Peer: In Person
Engaging in peer-to-peer (P2P) transactions to buy and sell bitcoin in person involves directly exchanging your fiat currency (or any other goods or services) for bitcoin with another individual, eliminating the need for a bank or other party to be involved.
Both parties agree on the amount and rate. The buyer provides cash, the seller sends the bitcoin, and the transaction is complete once confirmed on the blockchain. Exchanging bitcoin for fiat works the same way in reverse.
Peer-to-Peer: Online
While it's easier to do peer-to-peer exchanges in person by meeting with the other individual directly in the real world, this carries some risk, just like any other in-person trade for cash does. This is why some people choose to exchange bitcoin virtually, wherever they are thanks to the internet.
Enter peer-to-peer platforms, where Bitcoin buyers and sellers meet in cyberspace to conduct transactions without any intermediaries, directly on the internet. On such platforms, you don't have to trust anyone with your information or money; you connect with other peers and trade with them directly.
📖
On most peer-to-peer platforms, peers have to escrow some of the funds to ensure each side will comply with their part of the deal. Escrow means putting the money in a safe place under the control of the platform until both parties do what they promised. It's like a trusted friend holding onto your stuff until everyone is satisfied with the deal.
✒ TEACHER: the four ways to acquire bitcoin
Get paid in bitcoin for work; mine bitcoin; exchange fiat for bitcoin in person; exchange fiat for bitcoin online 6.1
The chapter focuses on the two most common routes: peer-to-peer (in person and online) and centralized exchanges 6.1
✒ TEACHER: P2P in person and online, and what escrow means
P2P in person: two people agree on amount and rate; buyer provides cash, seller sends bitcoin, done once confirmed on the blockchain, no bank involved 6.1
Name the practical risk plainly: meeting strangers for a cash trade carries some risk, just like any cash trade 6.1
Escrow: the platform holds the funds in a safe place until both sides do what they promised, like a trusted friend holding your stuff until everyone is satisfied 6.1
ANTICIPATE
Myth to expect: "P2P means there are no rules or protection at all." No: online platforms use escrow precisely to reduce counterparty risk while still keeping the trade direct between peers.
Keep the in-person risk realistic, not scary: it is the same caution as any cash meetup, not a warning against Bitcoin.
Teacher's Edition6.1 •
Hard Money Diploma · Student WorkbookModule 06 · How to Use Bitcoin
Guide: part of 12Plan 5 to 6
6.1 Acquiring Bitcoin (continued)
Centralized Exchanges
Centralized exchanges are companies that allow clients to buy and sell bitcoin directly through them. They are the easiest way to acquire and dispose of bitcoin, but this convenience comes with significant trade-offs.
Centralized Exchanges Trade-Offs
It's important to note that when buying bitcoin through a centralized exchange, you are often required to provide personal information and verify your identity. This creates a risk of identity theft and exposes your personal information to potential threats. Additionally, centralized exchanges hold your bitcoin for you, which means you are not in control of your money until you withdraw your funds.
To add to these concerns, centralized exchanges can misappropriate user's funds or sell more bitcoin than they have in reserves until they collapse. Yes, just like banks! Except that, in the Bitcoin world, there is no central bank to bail out fraudulent banks by printing more currency, because you can't print more bitcoin!
✒ TEACHER: the centralized exchange trade-off in one breath
Centralized exchanges are companies that let clients buy and sell bitcoin directly; they are the easiest way, but the convenience comes with significant trade-offs 6.1
Trade-offs: you often must share personal information and verify identity, and the exchange holds your bitcoin, so you are not in control until you withdraw 6.1
They can misappropriate funds or sell more bitcoin than they hold until they collapse, just like banks, but there is no central bank to bail them out because you can't print more bitcoin 6.1
ANTICIPATE
This is the guide's key reinforcement: convenience often comes with trade-offs in privacy and sovereignty. Teach it as the book's structural point about custody, not as a warning about any specific company.
Myth to expect: "bitcoin on an exchange is the same as bitcoin you hold." No: on an exchange the company holds it for you; you are not in control until you withdraw to your own wallet.
Teacher's Edition6.1 •
Hard Money Diploma · Student WorkbookModule 06 · How to Use Bitcoin
Guide: part of 35 · "one of the most important parts"Plan 15 to 18
6.2 Introduction to Wallets
Unlike physical money, bitcoin are not actually contained in a Bitcoin wallet. Instead, they live on the distributed ledger that the Bitcoin network constantly verifies and secures. So, how can you own bitcoin? You have ownership of your bitcoin only if you control the private keys allowing you to sign transactions and transfer ownership of your bitcoin to someone else. This is the act of sending bitcoin.
Let's take a look at two concepts we refer to when using the term wallet:
A master private key, like a password, from which your public keys, like email addresses, are generated. You can share your public address with others to receive and send bitcoin, but you must never share your private key!
The mobile or desktop interface used to interact with the Bitcoin network, check your bitcoin balance, send and receive transactions, and broadcast them to the network.
Self-Custodial vs Custodial Wallets
Self-custodial means the user holds the private keys and truly controls their bitcoin; with custodial wallets, a third party holds the bitcoin for the user.
Type
Control
Benefits
Risks
Self-Custodial
The user
Complete control over funds and transactions, no approval process or account freeze, no corporate or government control, protected against confiscation.
No recovery if recovery phrase is lost, full responsibility falls on the user.
Custodial
The third-party provider
Easy recovery if access is lost, easier customer support.
Funds are connected to the Internet, more vulnerable to hacking. The custodian can freeze accounts.
💡
"Not your keys, not your coins" is a popular saying among bitcoin holders. It refers to the idea that if you don't have direct control over the private keys associated with your Bitcoin wallet, you don't have true ownership of the coins.
✒ TEACHER: where bitcoin actually "lives," and the email analogy
Clear up the common misunderstanding right away: bitcoin is not stored inside the wallet app like cash in a bag; it lives on the ledger, and what you control is the ability to spend it through private keys 6.2
Public address = like an email address you can share; private key = like a password you must never share 6.2
Be very clear: whoever controls the private keys controls the bitcoin. That is the core concept students must understand 6.2
✒ TEACHER: self-custodial vs custodial, and "not your keys, not your coins"
Self-custodial: the user controls the keys, so full control, no approval process, protection against arbitrary confiscation, but greater responsibility and no easy recovery if the seed phrase is lost 6.2
Custodial: a third party controls the keys, so easier recovery and support, but more exposed to freezes, hacks, and third-party control, and the user does not truly hold the bitcoin 6.2
Land the slogan and its meaning: "Not your keys, not your coins." No keys, no true ownership 6.2
ANTICIPATE
Protect this page: the guide calls the self-custody distinction one of the most important parts of the chapter. If short on time, keep this and cut elsewhere first.
Myth to expect: "the wallet app stores my coins like a bag of cash." No: the coins live on the ledger; the wallet stores and uses the keys.
If students find custody hard, use the guide's line: "You control it; you're responsible." Acknowledge the trade-off honestly rather than pretending it is effortless.
Teacher's Edition6.2 •
Hard Money Diploma · Student WorkbookModule 06 · How to Use Bitcoin
Guide: part of 35Plan 15 to 18Wallet-evaluation activity not budgeted separately
6.2 Introduction to Wallets (continued)
Different Types of Bitcoin Wallets
Where your private key is created and stored determines how we describe Bitcoin wallets. If keys are on your smartphone, it's a mobile wallet. If they're stored securely on a dedicated device, it's a hardware wallet.
Type
Description
Advantages
Disadvantages
Example User
Online Wallet
Accessed through a web browser
Accessible from any device with an internet connection
Less secure because it can be hacked or compromised
Accesses their wallet frequently, doesn't have a lot of funds to store
Mobile Wallet
Installed on a mobile device
Easy to use
Can be lost if the device is stolen or hacked
Makes transactions on the go, doesn't have a lot of funds to store
Desktop Wallet
Installed on a desktop computer
Convenient and can be accessed from anywhere
Can be hacked if the computer is infected with malware
Wants to store a large amount, comfortable with a desktop computer
Hardware Wallet
A physical device that stores bitcoin offline
More secure than online wallets and can be used offline
Funds could be unrecoverable
Wants to store a large amount and will pay for added security
Because keys can be moved from one device to another, the "status" of your Bitcoin wallet is not fixed. For example, if I create my wallet keys on a computer and later move them to my phone, the "desktop wallet" becomes a "mobile wallet."
What to consider when choosing a wallet
Security, Privacy, Ease of use, Compatibility, Fees, Reputation, and Control over your private keys.
📖
Another important factor is whether the software is open-source. Open-source projects let the community review the code and continue the project if the team stops working on it. Just as Bitcoin's code is open for everyone to review, use, and modify, so should the code of the wallet you use.
✒ TEACHER: the wallet types, and do not crown a "best" one
Online, mobile, desktop, hardware: each involves trade-offs between security, privacy, convenience, compatibility, fees, control, and reputation. Do not treat one as perfect 6.2
Where the key is created and stored names the wallet; keys can move between devices, so the "status" is not fixed 6.2
✒ TEACHER: why open-source matters
Open-source tools can be reviewed, audited, and continued by the community if the team stops 6.2
Connect it forward: this is the same verification principle we land at the end of the module, "Don't Trust, Verify" 6.2
ANTICIPATE
Timing gap to name honestly: the "Discussion and evaluation of Bitcoin wallets" activity (using bitcoin.org/en/choose-your-wallet) is in the chapter, but the guide's 35-minute block never budgets separate minutes for it. Reserve real time if you plan to run it.
Myth to expect: "there is one best wallet." No: there is no ideal wallet for all needs; every type trades off security against convenience.
Teacher's Edition6.2 •
Hard Money Diploma · Student WorkbookModule 06 · How to Use Bitcoin
Guide: 10 minPlan 10 · protect the seed-phrase step
6.3 Setting Up a Mobile Wallet
Activity: Setting Up & Recovering a Wallet
We'll create a mobile wallet directly on a smartphone. If students do not have smartphones, the educator provides one to borrow. There are two options for this activity.
Option 1: Download a New Wallet
Search for the app in the App Store (iOS) or Google Play Store (Android).
Open the app and select "Create a new wallet." Your private key is automatically created by your app.
You will be prompted to write down a list of 12 to 24 words and keep it in a safe place. This is your recovery phrase (also called a seed phrase): it allows you to recover full access to your funds if needed.
Confirm you saved it by entering the words in the same order. Some wallets also let you choose a secure password.
Enter the wallet and find "Receive": your wallet generates a public key to receive bitcoin. With a self-custodial wallet you often cannot buy directly with fiat, so you may transfer from an exchange first.
⚠️
Remember that if you lose or forget this sequence of words, you will not be able to access your bitcoin if you lose access to your wallet. Also, if anyone else finds your recovery phrase they will gain access to your bitcoin!
Option 2: Restore a Wallet
On first start, choose [Import an existing wallet], then [Restore with recovery phrase].
Enter your recovery phrase one by one, in the correct order.
You'll see a confirmation once the wallet is imported. Your recovered funds are ready to use!
✒ TEACHER: the setup steps in order
Download the wallet, create a new wallet, generate and write down the recovery phrase, confirm it, add extra security if available, then open the wallet and find the receive function 6.3
If hands-on, pause at each step and check everyone understands what they are doing; if conceptual, walk it through as a demo rather than performed live 6.3
✒ TEACHER: make the seed-phrase warning explicit
If the seed phrase is lost, access to the funds may be lost; if someone else gets it, they can take the funds 6.3
The guide's centerpiece line: "This 12 words IS your Bitcoin." Say it plainly, then test the scenario: "What happens if you lose your phone?" 6.3
The restore option shows the same phrase can rebuild the wallet on any device if it was backed up correctly 6.3
ANTICIPATE
Protect this page: the guide's "if short on time" list keeps understanding wallet basics and self-custody; the seed phrase is the heart of both. Do not rush or cut it.
Myth to expect: "the seed phrase is just a login I can reset." No: this phrase IS your bitcoin; there is no customer service and no reset. Practice spotting phishing that asks for it.
Online-teaching safety: give a direct warning before the seed-phrase step and remind students never to type or share it in chat or with anyone online.
Teacher's Edition6.3 •
Hard Money Diploma · Student WorkbookModule 06 · How to Use Bitcoin
Guide: part of 17Plan 10 to 12
6.4 Receiving and Sending Transactions
A Bitcoin transaction is a transfer of ownership of bitcoin to a new owner. It is not the actual coins that are transferred, but ownership of them: the right to spend them. Every time a transaction is accepted into a block, all the nodes update their local copy of the public ledger to reflect the change of ownership. A Bitcoin transaction is more akin to a real estate transaction than to a cash transaction.
To "send" bitcoin, the sender signs a message with their private key, signaling to the network that the rightful owner has transferred ownership to the recipient. The bitcoin will now be tied to the recipient's address, so that only the new owner can spend them using their private key.
Jim owes Eliana 0.5 BTC
Eliana shares her address with Jim.
Jim's wallet creates the transaction: Eliana's address, the amount (0.5 BTC), and a fee for the miner. Higher fees make it more likely a miner includes it in the next block.
After signing, it is broadcast to the network and verified by nodes, who check Jim has enough funds and is the rightful owner. If not, they reject it immediately.
Once verified, miners choose whether to add it to the next block, usually based on the fee. In a block, it is added to the blockchain and the funds move to Eliana's address.
Ownership has transferred to Eliana. She can now use her private key to spend the funds.
💡
How a Bitcoin transaction works: someone requests a transaction; it is broadcast to P2P computers (nodes); miners verify it; transactions combine to form a data block; the new block is added to the existing blockchain; the transaction is complete. Once complete, it cannot be reversed.
📖
The transaction is confirmed by the Bitcoin Network and usually takes about 10 minutes. For greater security, it is recommended to wait for two confirmations, which takes about 20 minutes. On-chain transactions are the safest way to transact because of the decentralized verification, but they are slower and can be more expensive than other options (discussed in Module 7) due to the miner fee.
✒ TEACHER: the key points about a transaction
A transaction transfers ownership, not physical coins; transactions are irreversible; nodes verify validity; miners include transactions in blocks; fees influence confirmation priority 6.4
On-chain transactions are generally secure, but slower and often more expensive than Lightning transactions 6.4
✒ TEACHER: receiving vs sending, step by step
Receiving: open the wallet, tap receive or deposit, then copy the address, share the link, or show the QR code 6.4
Sending: open the wallet, paste or scan the recipient's address, enter the amount, double-check all details, broadcast, and wait for confirmation 6.4
Say it every time: double-check the address and amount before you confirm, because transactions are irreversible 6.4
ANTICIPATE
Myth to expect: "if I send to the wrong address I can just call support and reverse it." No: on-chain transactions cannot be reversed. That is why double-checking the address is a non-negotiable habit.
The transaction-flow diagram is the most useful visual here; use it so students can see the path from wallet request to network confirmation.
Teacher's Edition6.4 •
Hard Money Diploma · Student WorkbookModule 06 · How to Use Bitcoin
Guide: part of 17Plan 5 to 7Activity time not budgeted separately
6.4 Receiving and Sending Transactions (continued)
Activity: Transactions In Action
This is a cooperative exercise simplifying the basic roles of people involved in a Bitcoin transaction. There are four types of participants in every bitcoin transaction: the sender, the recipient, miners, and node operators.
Key Points
The sender must approve (cryptographically sign) the amount of bitcoin to send AND the specific address to send to.
The recipient must provide a valid address to the sender AND verify the transaction was successfully confirmed on the blockchain.
Miners ensure all criteria are valid before adding transactions to future blocks.
Node operators verify mined blocks are valid before updating their version of the blockchain (the ledger).
💡
Student Tip: rotate through all four roles to experience what each participant does.
✒ TEACHER: the four roles and why we rotate them
Four roles: sender, recipient, miner, node operator. Assign roles and walk through one transaction step by step 6.4
The point is not technical depth; it is helping students see who does what, and why verification matters, so a transaction feels like a coordinated process, not magic 6.4
Rotate students through all four roles so each one experiences approval, verification, block inclusion, and ledger update 6.4
ANTICIPATE
Timing gap to name honestly: "Transactions in Action" is a full activity but the guide's 17-minute block for 6.4 does not budget it separately. Reserve real time (use the game card below) or run it as a quick walkthrough.
Two activities in the guide's Activities list, "Lightning Relay Race" and "Exploring the Mempool," never appear in the chapter content or the Procedure. Treat them as optional extensions, not required, and do not improvise Lightning content that belongs to Module 7.
Myth to expect: "miners and nodes are the same job." No: miners assemble and add blocks; node operators independently verify those blocks before updating their ledger.
Teacher's Edition6.4 •
Hard Money Diploma · Student WorkbookModule 06 · How to Use Bitcoin
Guide: 8 minPlan 8
6.5 Don't Trust, Verify
Whatever you do in Bitcoin, remember this: "Don't Trust, Verify." There are no rulers in Bitcoin. You should never blindly follow someone's claims; rather, you should always question what you're being told and verify it for yourself. By following this mantra, you'll protect yourself from losing your bitcoin.
This goes for claims such as "the next Bitcoin" just like it does for "investment opportunities" or promises of "quick and easy profits." This is why open-source projects should be favored. If you can't verify the code yourself, you will have to trust the community who will do it for you; but it's better to trust a decentralized and independent group of verifiers than the leader or group behind the project.
✒ TEACHER: what "Don't Trust, Verify" applies to
It applies to wallets, exchanges, apps, transaction details, claims about "easy profits," and projects pretending to be like Bitcoin 6.5
Bitcoin requires users to think critically, verify what they use, and avoid blind trust; open-source tools make independent verification possible 6.5
Better to trust a decentralized, independent group of verifiers than the leader or group behind a project 6.5
Wrap-Up and Check for Understanding
What is the difference between a custodial and self-custodial wallet?
Why is the seed phrase so important?
What happens when you send an on-chain transaction?
Why are on-chain transactions slower than some other Bitcoin payments?
What does "Don't Trust, Verify" mean in practice?
✒ TEACHER: wrap-up answers
Custodial: a third party holds the keys; self-custodial: the user holds the keys and truly controls the bitcoin 6.2
The seed phrase is important because it IS your bitcoin: lose it and access can be lost; if someone else gets it, they can take the funds 6.3
Sending on-chain: you sign with your private key, nodes verify, miners include it in a block, and ownership transfers irreversibly 6.4
On-chain is slower and costlier because of decentralized verification and the miner fee; faster options come in Module 7 6.4
"Don't Trust, Verify" means question claims and check for yourself, favoring open-source you or the community can audit 6.5
✒ TEACHER: the three "if students struggle" fixes
Seed phrases feel abstract → "This phrase IS your bitcoin; no customer service" 6.3
Public vs private keys → the email analogy: address you can share vs password you must protect 6.2
Why it's hard → "You control it; you're responsible." Acknowledge the trade-off rather than pretending it's effortless 6.2
ANTICIPATE
Protect this page: adopting a responsible verification mindset is on the guide's short-on-time priority list. Even when running long, land "Don't Trust, Verify."
Myth to expect: "if a project says it is the next Bitcoin, it must be safe." No: that is exactly the kind of claim the mantra tells you to verify, not trust.
This module's bridge: next comes Module 7, where faster and cheaper payment options like Lightning are covered. Hold that content for then.
Teacher's Edition6.5 •
PRINT THIS · YOUR IN-ROOM CARD
Module 6 cheat sheet
0:00 intro + practical use0:08 acquiring + exchanges0:20 wallets + self-custody0:55 set up mobile wallet1:05 send/receive + roles1:22 don't trust, verify + wrap-up
THE SEED PHRASE IS THE CENTERPIECE"This 12 words IS your Bitcoin. No customer service, no reset. Lose it and the funds are gone; share it and they're stolen." Give a direct warning before the seed-phrase step, especially online.
THE EMAIL ANALOGY"Public address = an email address you can share. Private key = the password you must never share."
NOT YOUR KEYS, NOT YOUR COINS"If you don't control the private keys, you don't have true ownership. On an exchange, the company holds it until you withdraw."
IRREVERSIBLE BY DESIGN"Double-check the address and amount before you confirm. On-chain transactions cannot be reversed."
"SHOULD I BUY BITCOIN?""We teach how Bitcoin works, not whether to buy it. This is educational only, not financial advice. For personal decisions, talk to a licensed professional."
RUNNING LONGKeep wallet basics, self-custody, the basic transaction flow, and the verify mindset. Cut hardware-wallet deep-dives and the wallet-comparison browsing activity first. Never cut the seed-phrase warning.
RUN THE ROOM · GAME CARD
Transactions in Action (the four roles)
Transactions in Action · 8 TO 12 MIN · SHOWS A TRANSACTION IS A COORDINATED PROCESS
SETUP Assign four roles: Sender, Recipient, Miner, and Node Operator. Use paper "coins" and index cards for "addresses." No real money, no real wallets required. Give the Recipient a card that reads a made-up address.
ROUND 1: REQUEST AND SIGN The Recipient hands their address card to the Sender. The Sender writes the amount and the address on a "transaction" slip and signs it (their signature stands in for the private key). Point out: the sender approves BOTH the amount and the exact address.
ROUND 2: VERIFY AND MINE The Sender broadcasts the slip. The Miner checks the sender "has enough coins" and bundles the slip into a paper "block." The Node Operator inspects the block and only then updates the class "ledger" (a shared sheet on the wall).
DEBRIEF "Who had to approve what? Who checked the work? What happened that no single person could undo?"
POINT A transaction is not magic: it is approval, verification, block inclusion, and an independent ledger update. Rotate all four roles so everyone feels each job.
REQUIRED REFLEX
A dad asks quietly after class: "So should I put money into Bitcoin?"
Same line, every teacher, every time. Never predict prices, never say buy, sell, or hold.
LAST STEP · YOUR REHEARSAL
Run one page live, then you are ready
Pick the page you are most nervous about and run it for the course lead for 5 minutes, printed cheat sheet in hand. A rehearsal, not an audition: you choose the page, you know the bar: ask then wait, speak in your own words, make the seed phrase real, and the "should I buy?" line comes out automatically.
✔ Ready to teach Module 6
Based on the Bitcoin Diploma and Educator Guide by My First Bitcoin (myfirstbitcoin.org), used under CC BY-SA 4.0. Changes were made (teacher annotations added). This adaptation is also licensed CC BY-SA 4.0.
Liberty Villages is an independent 501(c)(3); not affiliated with, endorsed by, or sponsored by My First Bitcoin. Educational only, not financial, legal, or investment advice.