What You Need to Know Before Investing in Bitcoin
There is a high chance that you’ve heard of bitcoin before, even if the exact details are not clear. You could be thinking about investing in bitcoin but don’t have the knowledge of how to go about the process. It is imperative that you’re doing research as bitcoin like any other cryptocurrency is known to be volatile. There are some investors that consider bitcoin as a safe haven because they’ve mastered the trading elements of the cryptocurrency. Here are some things you need to know before you can invest in cryptocurrency.
Purchasing the Coin
Before you can invest, you’ll need to start by purchasing the coin. Coinbase is the biggest broker for bitcoin. The platform now supports customers from over 30 countries and it is easy to trade if you’re in the United States or Europe. There are other brokers as well but it is important that you’re doing research so that you’re not ending up in the hands of someone that is unreliable.
Bitcoin Gaining Traction
You might be wondering why bitcoin has been gaining traction in the last couple of years. This is because the world is increasingly relying on the internet. There are a lot of transactions happening online. The use of bitcoin as a secure digital currency has gained the attention of big investors. Countries like Russia and China are trying to see how they can incorporate the use of bitcoin in their trading endeavors. If you’re still unsure if investing in bitcoin is a good idea, you just have to look at the adoption rate in the last couple of years.
Bitcoin is Decentralized
In contrast with other world currencies, bitcoin is decentralized. There is no single control system which means there is autonomy over the currency. The coin can’t be seized or be devalued by any central body. There are criminal elements that have taken advantage of such decentralized systems.
Investing Using Third Parties
Once you’ve decided to put your money on bitcoin, you could decide to use an investment firm. There are such companies that are dedicated cryptocurrency alone. Make sure you’re doing your homework as you will be trusting such a firm with your money. They should have a successful track record for making money for their clients. Their portfolio will be all the convincing that you need in order to work with them.
Bitcoin is Real Currency
Bitcoin can be used as a substitute for the currencies that you’re used to. There are some online shops that have started accepting it as a means of payment. You don’t have to worry about the middle man and the banks when making transactions. There are no transaction fees as there are only two parties involved, the sender and the receiver. There are big companies like Expedia Media and Microsoft that accept bitcoin as a form of payment. This means that it has already been accepted and it will only be a matter of time before other companies start accepting the use of bitcoin.
Investors Have Limited Options
Investors usually compare the coin to gold which can be used as a hedge against inflation. For an investor, you can either buy from a broker like Coinbase or using other sources. You just need to be careful where you’re getting the coin from as not everyone will have your best interest at heart.
Bitcoin is Scarce and Useful
It is estimated that there are 21 million bitcoins. 17 million coins have already been mined. If you’re to mine the bitcoins on your own, you’ll be competing with big companies that have the resources to embark on such an undertaking. You will need a powerful computer before you can even think about doing the mining. Bitcoin has a sound and predictable policy that can easily be understood if you intend to invest in the coin. You can send money to any part of the world in real-time without having to worry about the normal bureaucracies. For the latest bitcoin news now, it is crucial that you’re always online. You’d want to know what is happening around the world which could have a direct influence on the price of the coin.
Right Time to Buy
There are no guarantees in any market and cryptocurrency is no exception. What could appear to be the right time to buy could be a result of market forces. Don’t rush into making decisions given the volatility of bitcoin. The global happenings will always influence the prices of bitcoin which could force investors to buy or sell.
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