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Intermediate

Testnet Practice

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This lesson is a practical guide to using Bitcoin's testnet, a sandbox environment where you can learn and experiment with Bitcoin transactions without risking real funds. By engaging in testnet practice, you'll gain hands-on experience with Bitcoin transactions, understand network dynamics, and refine your skills in a risk-free setting.
Video length: 5 mins 36 secs

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Transcript

Greetings, future Bitcoiners! As we conclude our Bitcoin Essentials course, it's time to put theory into practice. The Bitcoin testnet offers a golden opportunity to experiment with transactions, account management, and more, without the worry of losing actual bitcoins. Let's explore how you can leverage the testnet to enhance your understanding and confidence in handling Bitcoin.

The Bitcoin Testnet
The live Bitcoin network is referred to as mainnet to differentiate it from Bitcoin's testnet, which is an alternative Bitcoin blockchain, used for testing and learning only. The testnet is identical to mainnet in it’s structure. The Bitcoin testnet runs on Bitcoin testnet nodes and is mined by Bitcoin testnet miners, similar to Bitcoin mainnet nodes and miners, but only mainnet coins have value. Testnet coins are separate and distinct from the real mainnet bitcoins, and never have any value. This allows application developers or bitcoin testers to experiment, without having to use real bitcoins or worrying about breaking the live bitcoin blockchain.

Several Bitcoin wallets and applications support the testnet mode. This can typically be activated in settings. When learning, ensure you're in testnet mode to avoid any loss of real funds. During this lesson we will use Green wallet by Blockstream. You can find the download link at blockstream.com/green. Download and install the wallet to your phone or computer.

Setting Up Your Wallet
As a first step you need to enable Testnet support in your Green wallet. Click “Settings” on the main page, switch on “Enable Testnet”, and “Save”. Now, you can click “New Wallet” on the main page, and select “Testnet” in the “Select Network” pop-up window. Next you will be promted to generate a seed. Pick the “12 words” option. Even though this is just a testnet wallet, you should write down and verify the mnemonic code as a practice before you create your real bitcoin wallet. Next, you will be asked to setup a pin. This pin is only for your wallet, and not related to your seed phrase. Next, click Create Account and select the asset as “Bitcoin” and Security Policy as “Standard”. Finally, you will be presented with your account interface.

Click the grey coin icons to change the denomination to satoshis, which shows as s-TEST for the test wallet. In a “live” wallet it should up as SAT. Now you’re ready to receive some test coins.

Receiving Testnet Satoshis
First of all generate your first address to receive bitcoins. Click “Receive”, and you will see the text based address and the QR code that has the same address encoded in it. Note that your address will start with “t” to signal that it’s a testnet address.

Google “bitcoin testnet faucet” and find several websites offering to send you a small amount of testnet satoshis. Provide your address and request the testnet coins.

While you wait for those websites to send you testnet satoshis, you can visit mempool.space. By default the website it showing “mainnet” which is the live bitcoin blockchain. On the top left there is a dropdown to select Testnet. Then, search for your address. If the websites already sent you the coins you will see the transactions listed. You can monitor their confirmation status. The same status will be visible in your account. Wait until you have at least 1 confirmation, so you can see how the status of the transaction changes.

Restoring An Account
Since you have a few satoshis, this is a good time to practice restoring a lost account. Imagine you lose your phone, and you want to restore your funds. Let’s simulate this by deleting the Green wallet app and its data entirely from your phone. Now, download the app again, and notice that your wallet account is gone. Enable testnet mode again. Now click “Restore Wallet” and enter your 12 word mnemonic code. Your account will be recovered shortly and after a few seconds your should be able to see your satoshis.

Sending Testnet Satoshis
Now, as a last step, try to send some or all of your satoshis to any test address. For example, you could send them back to the faucets. Click “Send”, enter the destination address starting with “t”, the amount and set a fee. The fees on the testnet network are very low, so you can set it at 1-2 sat/vB. On the live blockchain, also called mainnet, you would need to check the latest fee rate to ensure you have sufficiently high fees. Once the transaction is sent it will show up in your list of latest transactions. Click on it to see the transaction details. Note the amount of satoshis you paid for the transaction in fees.

Congratulations! With this exercise you successfully completed the Bitcoin Essentials course. Our journey through the Bitcoin Essentials course may be concluding, but your adventure in the world of Bitcoin is just beginning.

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