A Beginner’s Guide To Investing in Bitcoin
Have you been interested in investing in Bitcoin, but too intimidated to take the plunge? A lack of knowledge and understanding may have been holding you back.
Given the mass amounts of information available and the complex nature of Bitcoin investment, it’s completely understandable that you’d be a little confused. However, now is the time to say goodbye to disorientation and hello to a diversified investment portfolio. Read on to discover your perfect introduction to investing in Bitcoin.
What Is Bitcoin?
Bitcoin is a type of cryptocurrency that was created in January 2009. It promises investors and traders lower transaction fees than traditional online payment platforms. Additionally, it is operated by a decentralised authority, making it starkly different from government-issued currencies. Like all forms of cryptocurrency, Bitcoin is intangible, meaning there is no physical coin you can use; instead all of your Bitcoin funds are held in a digital wallet.
Where And How Can You Use Bitcoin?
Despite the fact that it’s an intangible and largely unofficial form of currency, you can use Bitcoin to purchase goods and services from several companies. Some of them include:
- Burger King
Once you grow into a more confident investor and trader, you can also use Bitcoin in your Forex trading activities.
Risks Of Bitcoin
Like any form of investment, Bitcoin investment carries its fair share of risks, of which you need to be aware before spending your hard-earned cash. Some of the most prominent risks include:
- Volatility – Since Bitcoin is a relatively new form of currency, it remains quite volatile. Specifically, a number of external factors can cause major swings in the value of Bitcoin. One major example is a tweet from Elon Musk, CEO of Tesla, which saw the price increase by 11% in one day.
- Lack of Tangibility – Bitcoin is intangible, meaning there is little to back it up. It simply carries value because the people investing in it say it has value. If the market were to suddenly decide that it did not have value, your investment could go up in smoke.
How To Buy Bitcoin
You feel ready to invest in Bitcoin, and now all that’s left to do is figure out how to buy some. First, you’ll need to choose an exchange, such as Gemini, Coinbase, or Kraken. There are several exchange platforms on the market, so be sure to do your research and compare your options to find the best one for you.
Next, you’ll need to link a payment method to your exchange account. This payment method is what you’ll use to purchase your Bitcoin. From there, you can place your order for as much Bitcoin as you’d like. Once you have it, make sure to store it in a safe place, such as your digital wallet.
As a beginner, investing in Bitcoin can seem daunting, but it doesn’t have to be. By reading this guide, you’ve taken the first step in overcoming your investing fears and mastering Bitcoin. With this knowledge, you’ll be poised to reach new investing heights.