Bitcoin is the new big thing. It’s taking over banks, big corporations, and even individuals. As the most popular cryptocurrency, Bitcoin is widely accepted around the world. It has so many applications, from buying just about anything to booking flights and hotels, and making investments – its uses are virtually endless.
If you’re interested to invest in Bitcoin, this article is for you.
Before Buying a Bitcoin – What You Need to Know
Bitcoin is highly valuable. There are only 21 million Bitcoin in the world and as time passes by, they become even more difficult to mine. Apart from being scarce, they are useful. It’s sound monetary policy is one of its valuable features. As the most highly secured cryptocurrency, Bitcoin can be sent from anywhere in the world to anywhere else in the world.
How much does a Bitcoin cost? Basically, its price is set by whatever people are willing to pay. But throughout history, it’s value has generally increased at a very fast pace. You can use this reference to check for the current price of Bitcoin. And because it’s global, it isn’t affected by a single country’s financial situation or stability.
Just like cash, you also want a secure place to store the Bitcoin you purchased. That’s why you need a Bitcoin Wallet.
Your bitcoin wallet is like your bank account. It’s primarily a storage for your Bitcoin and at the same time, it allows you to send and receive Bitcoins.
The following are the different types of wallets you can choose from, and they differ from features and devices.
Here are the most common types of Bitcoin wallets:
Hot Wallets and Cold Wallets
“Hot wallets” are powered by the internet while “cold wallets” are not. Cold wallets are considered more secure, which makes them ideal for storing large amounts of bitcoin. For regular use, choose a hot wallet for convenience. If you’re after long-term holdings, opt for a cold wallet.
Desktop Wallets and Mobile Wallets
Desktop wallets are downloadable from the internet and can be accessed from a desktop or laptop computer, even if you are offline. There are mobile versions too which are tailored to your Smartphone or Android.
Web Wallets and Physical Wallets
There are cloud-based wallets that are only accessible via the internet. But you can also choose to have paper wallets which you can store in a safety deposit box. Bitcoin wallets can also be available in a form of portable physical vaults which are incredibly small devices that allow you to securely store, send and conduct Bitcoin transactions online.
Where to Buy Bitcoin
There are several ways to buy a Bitcoin. Firstly, you can buy it using cash. It’s private and usually quick and is the easiest way. You can also buy a Bitcoin using a bitcoin ATM. There’s a general “buy process” at all bitcoin ATMs, although it may vary a bit from ATM to ATM. You can only pay cash through an ATM, and the charge is around f 5-10%.
Another way to purchase bitcoin is through Bitcoin Exchanges and Peer-to-Peer platforms – digital marketplaces where people can buy and sell bitcoins. You can also purchase through a Bitcoin Investment Trust. It serves as a bitcoin fund of sorts, which allows you to bet on bitcoin by buying its shares.
How to Purchase Digital Currencies
More and more people are using credit to purchase digital currencies. According to a survey by Lendedu, which involved 672 active bitcoin buyers, 18.15 percent used their credit card to fund their bitcoin purchases.
If you don’t have enough cash, you can buy Bitcoin through borrowed money, such as personal loans online. There’s an upward trend to the number of people borrowing cash to fund their Bitcoin investment.
Advice about Buying Bitcoins
Investing in Bitcoin can be confusing and overwhelming especially when you’re a newbie. Don’t just take anyone’s advice. Do your homework and come to a conclusion. Here are a few pointers when investing in Bitcoin:
- Know your purpose. Bitcoin trading is different than buying and holding. When you trade, you are buying it at a low price and sell them back at a high price after a short interval.
- Never invest more than you are willing to lose. It can be a risky investment and you should keep that in mind at all times.
- After purchasing Bitcoin, store it in your own personal wallet and never leave it in an Exchange. A hardware wallet is always the best form of storage.
- Make sure to buy Bitcoins only from reputable exchanges.
Investing in Bitcoin is a great step if you’re after growing your money and achieving financial freedom. Nonetheless, just like any forms of investment, you should take time learning about how it works, the buying process, where to store your Bitcoin, and how you can purchase it. By keeping in mind these tips, you are surely on the right path.