Bitcoin prices are surging.
In 2021, Bitcoin has seen a surge in new interests from new investors and traditional financial firms – who only recently- wouldn’t touch bitcoin with a 10-feet pole. This surge of interest has ballooned the asset’s price to a little more than $39,000 in the past few weeks.
With the advent of Covid-19, people are throwing their money into assets such as Bitcoin and gold. It is easy to understand this frenzy as economic experts are observing a widespread concern for a looming financial crisis.
If you are reading this article, you’ll like to find out more about Bitcoin. And possibly get in on the action.
In this article, we’ll look at some of the reasons to invest in bitcoin. Most importantly, how you invest in Bitcoin for potential returns.
Let’s get into it.
Why Invest in Bitcoin?
BTC has been around for over ten years now. While the asset has grown in value and popularity over this timeframe, many investors aren’t too sure about its potential as a reliable investment vehicle due to Bitcoin’s high volatility and regulation concerns.
Nevertheless, Bitcoin’s returns are promising. Bitcoin has outperformed every major asset in the past decade.
Still not sold on Bitcoin?
Apart from other glaring arguments for investing in bitcoin such as the fact that Bitcoin is an open-source, decentralized monetary system, BTC derives its value from its scarcity and high demand. BTC’s protocol limits in 21 million coins. There are a limited number of Bitcoins created.
One of Bitcoin’s attractive features is that no one single authority controls it unlike fiat currency – which is controlled by the Federal reserves.
Many investments are worried that due to light or non-existent regulation on bitcoin, there could be a boom in crypto and Bitcoin-related scams.
Here’s how to invest in Bitcoin the right way.
Getting Started with Bitcoin Investing
Investing in Bitcoin can be complicated and confusing if you are a complete beginner to cryptocurrency technology.
Do you mine Bitcoin or other cryptocurrencies?
Do you walk into a bank and demand to buy Bitcoin?
Or how do you store your purchased Bitcoin?
In recent times buying BTC has gotten easier. But it also means BTC-related scams have become widespread. You’ll need to follow the right process in order to safeguard your asset against scams.
Here’s what you need to know before getting started:
- A cryptocurrency exchange account
- A personal Identification document typically – your international passport or driver’s license.
- A payment method – Visa or Mastercard, or direct bank transfers.
- A secure connection to the internet.
As a beginner Bitcoin investor, your primary concern should be privacy and security. We recommend that you own a personal cryptocurrency storage device or wallet.
Follow these 3 steps to Invest in Bitcoin
- Find a reputable cryptocurrency exchange
There are many cryptocurrency exchanges today. An exchange allows you to turn your buy, sell, and trade cryptocurrency.
It is imperative to sign up to a reputable and secure cryptocurrency exchange. More than that, sign up to an exchange that allows its clients to withdraw their assets for storage in their personal wallets or devices. Most exchanges will require a KYC (know your customer) for security purposes. This is where your personal identification document will come in handy.
Furthermore, be sure to use the best internet security practices – 2-factor identification, secure internet connection, strong password – to make safeguard your asset.
- Link your payment method to Exchange
After signing up for an exchange, you’ll go through a verification process. This will require sending a copy of your personal documents. Once the exchange certifies your identity and your account, you can link your bank card – credit or debit depending on the exchange you choose.
You can deposit funds from your bank card to your crypto exchange account.
Most exchanges charge a minimal transaction charge for buying and selling BTC – certainly menial when compared to a bank to bank transactions.
- BTC storage
Technically, you are allowed to store your bitcoins on the exchange. Most exchanges have a pretty solid security system to safeguard your Bitcoin.
However, there’ve been cases where cryptocurrency exchange was hacked. This is why you should take the security into your own hands – even if you’ll be trading your Bitcoins or holding them long-term.
Storing your assets in your personal cryptocurrency device or wallet is the only way to have complete control of your funds.
For choosing a Bitcoin wallet, you have many options. You may choose hot wallets or cold wallets.