How To Invest In Bitcoin So You Can Finally Make Those Millions
Do you want to invest in bitcoin effectively in 2019? then this post is for you (continue reading).
Bitcoin (BTC) is a digital currency and peer-to-peer payment system created by the pseudonymous software developer Satoshi Nakamoto.
Though originally unknown to the general public, Bitcoin has recently attracted lots of attention in the financial world over the last few years.
With this widespread attention, the process of investing in Bitcoin has recently become easier than ever before.
However, it’s important to note that Bitcoin isn’t an ordinary investment (like, for instance, stock) — it’s more like an extremely unstable commodity, so don’t buy before you understand the risks.
How to invest in bitcoin securely
An investment in Bitcoin, could potentially result in an enormous payoff, which is perhaps why it has attracted such fervent supporters.
But the currency has many paths to failure. If you are willing to take a gamble, you must decide how to invest.
Because Bitcoin is a technology as well as money, you can own it in a way where you manage the tech yourself or you can have someone else handle it for you.
You can also own other investment vehicles that give you exposure to Bitcoin but shield you from the currency’s volatility and that allow you to benefit from tax-advantaged accounts such as IRAs and 401(k)s.
Here are the different ways you might buy, invest in and store Bitcoin, plus guidance on how to choose between them.
PART 1: Buying and Selling BTC
1: Create a Bitcoin wallet.
Today, buying and selling Bitcoin is easier for beginners than ever. As your first step, you’ll want to sign up for something called a Bitcoin wallet.
Like its name suggests, your wallet is a digital account that makes it fairly easy and convenient to buy, store, and sell your Bitcoin- think of it like a universal Bitcoin checking account.
Unlike a checking account, however, starting a Bitcoin wallet usually takes less than a minute, can be done online, and is quite easy.
2: Link your bank account to your wallet.
- Note that you may also be asked to provide contact information, like a phone number.
- To be clear, linking your bank account to your Bitcoin wallet is not any more of a risk to your personal security than it is to shop online. Virtually all reputable Bitcoin services make a point to advertise their high standards for security and encryption. While Bitcoin services have been targeted by hackers in the past, so too have many major online retailers.
3: Buy BTC with money from your bank account.
Now that you’ve supplied your bank information and it’s been verified by the Bitcoin service, it should be fairly easy to start purchasing BTC and adding it to your wallet.
Usually, on your wallet page, there should be an option labeled “Buy Bitcoin” or something similar — clicking this should take you through a straightforward transaction process that uses money from your bank account to purchase BTC.
- Note that the price of Bitcoin can (and does) change from day to day — sometimes significantly. Because Bitcoin is a relatively new form of currency, its market has yet to become stable. The current dollar-to-BTC exchange rate should be clearly listed when you buy it — as of May 2019, 1 BTC was equal to about $8,700.
4: Use your Bitcoin to buy from retailers that accept it.
- Victoria’s Secret
- Whole Foods
- If you’re market-savvy (or lucky), you can conceivably generate value for yourself this way by buying Bitcoin when its price is low, then purchasing goods when the value of Bitcoin is high to get a favorable deal on the goods. You can then sell these goods to make a profit or simply keep them.
5: Sell your Bitcoin to another user.
Unfortunately, selling Bitcoin isn’t quite as easy as buying it. There is no easy way to “cash out” your Bitcoins and receive money in your bank account — instead, you’ll have to find a buyer who’s willing to pay for them with money (or good/services).
In general, one of the easiest ways to do this is to sign up with an online Bitcoin marketplace.
If you find a buyer, you will complete the transaction through the website but will otherwise deal directly with him or her.
To use this method, you’ll usually have to register a seller account and verify your identity in a process separate from the one used to create your wallet.
- In the US, CoinCola, CoinBase and LocalBitcoins are three websites that offer this sort of selling service. In the UK, BitBargain and Bittylicious are two reputable options.
- In addition, some sites like Purse.io allow sellers to give Bitcoin to buyers who then use their own money to purchase goods online and send them to the seller — in essence, this is a roundabout way of using Bitcoin to buy from vendors that do not accept the currency.
6: Alternatively, sell your Bitcoin on an exchange.
- Reputable, well-known exchanges include Circle, Kraken, Bitcoininvestment and Virtex.
- In addition, some exchange sites like Binance, Bittrex, Bitfinex and Bitcoinshop allow you to trade Bitcoin for other digital currencies (like Dogecoin, Ethereum, Litecoin and Monero).
PART 2: Invest In Bitcoin Using Alternate Options
1: Consider setting up a regular purchase scheme.
2: Consider buying Bitcoin locally.
- Localbitcoins, Paxful are one of the most prominent local bitcoin marketplaces online. This sites allows you to search for buyers in over 6,000 cities and 200 countries, including the US.
3: Consider buying into a Bitcoin investing company.
4: Consider “mining” Bitcoin.
- The entire mining process is a complicated one that is beyond the scope of this article. For more information, read Bitcoin mining article.
- In addition, it’s important to understand that because Bitcoin are awarded in “blocks” of multiple Bitcoin at once, it’s usually in your best interest to join an established “pool” of miners, which will allow you to work together towards solving the block and share the rewards. Doing it alone can make you very uncompetitive as a miner — you may go a year or more without making a single Bitcoin
PART 3: Making Money On Your Investment
1: Buy low, sell high.
- As an example of the Bitcoin market’s volatility, in October 2013, the price for Bitcoin was hovering around $120-$125 per Bitcoin. Within a month and a half, the price had shot up almost tenfold to nearly $1,000 per Bitcoin. A year later, the price was a third of its peak value at about $350 per Bitcoin. It is unknown when the next price spike will occur (if ever)
2:Stay up-to-date on Bitcoin market trends.
It’s impossible to predict which way the Bitcoin market will go with certainty as mentioned above
However, your best hope for making money off a Bitcoin investment is probably to monitor trends in the marketplace frequently.
Because the Bitcoin marketplace can fluctuate rapidly, money-making opportunities like spikes in the exchange rate can appear and disappear in a matter of days, so keep a close eye on the exchange rate for your best chance at success.
- You may also want to become a member of Bitcoin discussion forums (like, for instance, the forums at Bitcointalk.org) so that you can communicate with other investors about market predictions. Keep in mind, however, that no investors, no matter their expertise, can predict the Bitcoin market with certainty.
3: Use Bitcoin wealth to purchase more stable investments.
4: Never put more money into Bitcoin than you can afford to lose.
- Don’t buy into the sunk cost fallacy — the idea that you’re “too deep” into an investment to pull out. Missing a price spike and selling at a slight loss is better than waiting and selling at a large loss.
In conclusion, here are few tips to help you invest in bitcoin
- Note that the price of Bitcoins can vary from one country to another. If you’re willing to take the risk, you can potentially make money by buying BTC cheap in one country and selling it high in another, though, of course, it’s possible to lose money doing this if the market changes.
- If you’re interested in maintaining your anonymity, consider purchasing Bitcoins by mail using a service like BitBrothers LLC. For a fee, these services will buy BTC for you without your ever having to log in online.
- If you’re lucky, you may live near a BTM — a special type of machine that works like an ATM and allows you to buy Bitcoins in person. See Bitcoinatmmap.com to see if any BTM are near you.