Knowing how to Invest in Bitcoin may seem daunting at first, especially to first timers, but it can be easily understood when follwed up according to it's layed down steps.
Also investor's need to understand that Bitcoin investments aren't just for a certain class of persons ony as many may feel, as you get familiar with it, you would realize that Banks and even some buisness around you, are making serious money from cryptocurrencies You would also realize that you don't need to understand or become a computer programmer to start investing in bitcons yourself.
Bitcoin investments i would say are simply for the bold and confident people.
And so the question is - Are you?
But before we proceed, be reminded that Bitcoin investing carries a high degree of speculative risk. Compared to other cryptocurrencies, Bitcoin mostly rely on the; faith of investors, its inclusion into financial markets, the general public's interest in using it, and its overall performance.
Before starting Bitcoin investing, Investors should be aware of the technical and security issues. For instance Investors who desire to trade bitcoin need a place to store them. - a digital wallet or in a bitcoin wallet.
Investors would also need to know how to buy bitcoin, this can be done by connecting a wallet or your bitcoin wallet to a bank account, a credit card, or a debit card.
After which they can join an exchange or online marketplace to trade traditional currencies, bitcoin, and other cryptocurrencies.
With that being said, here are the 4 steps that you need to take to start investing in bitcoin.
1. Have a Bitcoin Wallet
Bitcoins, aren't physcal coins currencies and so like every other e-currency, they must be stored in a digital wallet. Hence you must first have a bitcoin wallet.
Now when it comes to picking a bitcoin wallet, there 2 types of wallets to take in to consideration; the "software" and "hardware" wallets.
What are software wallets ?
Software wallets are mobile apps that can be connected to your local bank account thereby enabling a fast and easy access to your bitcons. Although the downside to it is that it places your money in the hands of a. third-party company
The key to this, is storing your bitcoins with a more secure bitcoin wallet. There are a couple of them around, Coinbase, is one of them.
Coinbase happens to be one of the most trusted software wallet available in the United States. This is because it has a website, it has a mobile application, and also stores 98% of it's customers currencies offline for added security. If you are a beginner, Coinbase is the best and easiest place to startup with because, it is connected directly to a bitcoin exchange, which makes it easy for buying and selling of bitcoins.
There are also manny other bitcoin wallets available. Blockchain.com is one of them, there is also Mycelium, another highly secure mobile wallets, but it can be a little harder to use, there is also Blockchain Wallet, Electrum...e.t.c.
you can check them out on your own.
The other type of wallets to take into consideration is the "Hardware wallets". Although a bit old-school, they are generally considered to be more secure because they store a user's private key on a physical hardware device similar to a flash drive thereby preventing online theft/fraudsters from accessing a user's private key through an Internet connection; since flash-drives have to be plugged in to a device first, before they can be accesed. - Trezor and Ledger are two of the leading hardware wallet manufacturers.
2. Connect a Bank Account
If you've picked your choice of bitcoin wallet, the next step would be connecting it to your local bank account, debit card, or credit card. You must also know that exchanging your bitcoin into your local currency through any of this mediums, attract their own set of fees.
Bank accounts are generally recommended because, say par adventure you are dealing with larger sums of money, while debit and credit cards on the hand makes it easy for you to buy bitcoins almost in a heartbeat.
When you link a bank account to your wallet, you can easily buy and sell bitcoins and after which deposit the money straight into your bank account.
At the time of writing this piece, bank accounts allow users to spend as much as $25,000 per week.
3. Sign up for a Bitcoin Exchange
If you've connected your bitcoin wallet to your bank account, the next step would be; signing up for an online exchanger.
What are online exchangers ?
This are marketplaces where you can trade bitcoins for your own local currencies. For example; BTC for USD.
There are various types of exchanges you can pick from, and they all vary in their reliability, security, processing fees, exchange rates, and cryptocurrencies availability.
Below are our recommended list of top bitcoin exchangers for you to examine before finally settling for your choice of exchangers.
Coinbase: (The best choice for Beginners).
Highly respected and recognized currency exchangers in the US. Coinbase allows its users to securely buy and store cryptocurrency in one location.
They charge a 1.49% fee for U.S. transactions from a bank account or Coinbase USD wallet, while purchases made using a credit or debit card are charged a 3.99% fee. Coinbase secures cash balances up to $250,000 in the event of theft or breach in online storage.
Square Cash: (Best for on the go).
The Square Cash app rules when it comes to peer-to-peer money transfers right alongside PayPal's Venmo.
A product Square, a huge financial tech company that makes most mobile credit card readers and also operates many other services, one of which is trading bitcoin.
Unlike most online exchanges, the Cash App stores your bitcoin in your Square Cash Account, rather than a separate digital wallet. In the case of security worry's and concern, you can send the bitcoin in your Square Cash Account to another wallet of your choice. Square Cash has a deposit limits of $10,000 per week, but there is are no limits to what you can sell.
Robinhood: (Best for Bitcoin on a Budget).
launched in 2013 as a fee-free stock brokerage company, Robinhood later expanded in Feb. 2018, into a Bitcoin and Ethereum market along with market data for another 15 currencies, allowing users the liberty to trade cryptocurrencies without a fee. And just like Square, Robinhood stores bitcoins in the same Robinhood account used for stocks. Robinhood just recently added a web version to their already mobile platform, making it convenient for those managing money from their phones or tablet.
Coinbase Pro: For The Big Spenders:
Formerly known as: Coinbase Global Digital Asset Exchange (GDAX) uses a platform similar to Bloomberg terminals and active stock, commodity, and option trading platforms.
If you are already on coinbase, and you wish to up your trading volume, then you may switch from coinbase to coinbase pro.
Coinbase Pro also offers the options to make market orders, limit orders, and stop orders in addition to traditional buying and selling. Coinbase Pro also allows users to trade between cryptocurrencies, with fees ranging from 0.04% to 0.50% based on your trading volume. Most people who trade less than $10 million per month will fall into the 0.20% tier. If you love to go big, then Coinbase Pro is your Best bet.
Peer-to-Peer exchange (Best for buying in cash)
For those with a wallet, that isn't connected to a bank account, debit, or credit card, can also buy bitcoins using cash through a peer-to-peer exchange. Unlike bitcoin wallets, peer-to-peer exchanges allow buyers and sellers in the same areas to find each other and meet up to trade bitcoins for cash.
Note: When working with peer-to-peer exchangers, It is important for you to always remember that you are trading high-value currencies with persons you have never met before. So if you decide to go with peer-to-peer exchanges, it is advised you meet buyers and sellers in a public place.
4. Placing Your Orders
Finally, if you have carefully applied steps 1 to 3, then you are now ready to buy bitcoin for the first time.
It is important to note that although one bitcoin costs several thousand of dollars, bitcoin can be divided up to eight decimal points.
The smallest unit of a bitcoin is known as a satoshi.
So even if the price of bitcoin where to skyrocket all of a sudden, you would still be confident in the fact that you can still buy a satoshi for a tiny fraction of a cent.
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