A Step-by-Step Guide on How to Invest in Bitcoin

The popularity of bitcoin among investors is continually growing and it is with good reason. While it is a risky investment option, the momentum it is increasingly gaining makes it argued as the future of currency and investing.  The valuation of bitcoin has increased by more than 763% over the past year and popular public figures like Elon Musk have endorsed the digital currency further increasing its popularity. 

Bitcoin was built by a pseudo programmer under the name of “Satoshi Nakamoto” and since its creation, bitcoin is one of the most widely used forms of cryptocurrency. Its creation was aimed at solving several problems with existing crypto such as ease of fraudulent duplication.  The technology for investing in bitcoin is done through blockchain technology which is an advanced coding mechanism that disperses a code over thousands of different computers protecting it because hackers would have to access several computers to get the entire code. 

Starting the investment journey in cryptocurrency can be intimidating as most people still do not know how to invest in bitcoin. Well, we are here to help you with that with this easy step-by-step guide on how to invest in bitcoin:

What you need to invest securely in bitcoin:

Investing in bitcoin needs the following three primary things:

  • Your identification documents
  • A secure internet connection 
  • A bank account

Steps to take when investing:

Join a bitcoin exchange platform:  bitcoin does not have any official bitcoin company due to its open-source technology. Most bitcoin exchanges happen in cryptocurrency exchanges that function almost the same as stock exchange markets. When purchasing from an exchange, take careful consideration on which exchange to join. You can also explore other methods of buying your bitcoin such as buying directly from someone or using an investment firm with a reputable understanding of market trends. 

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Get your bitcoin wallet:  coins purchased through an exchange or any other means are usually stored in a wallet. Bitcoin wallets can be hot or cold wallets. Hot wallets are operated for you by your crypto exchange or by a provider while cold wallets are directly operated for you. Hot wallets can be accessed through the internet or software programs. They do, however, have risk factors of hacking attached to having them. Cold wallets tend to be safer as the storage process is done in actual physical hardware. 

Connect the wallet you choose with a bank account: linking your bitcoin wallet to a bank account makes it possible to sell and buy coins. The linking for bank accounts can also be done through your cryptocurrency exchange account. 

Place an order for bitcoin: the initial investments for bitcoin could be as low as 25$ and purchases can be made easily through your cryptocurrency exchange. The number of coins you buy will be dependent on your risk tolerance because investing in bitcoin is a highly risky investment. 

Track and manage your bitcoin investment: what you choose to do with your coins after purchasing them may vary. You can choose to hold the coins in hopes that soon the value will appreciate or trade on the cryptocurrency exchange or through your investing firm. You can also use your coins to make online transactions with traders who will accept bitcoin. 

Conclusion: 

Knowing how to invest in bitcoin can be a tricky process.  Partnering with the right investment platform and equipping yourself with the necessary knowledge will, however, make sure you make the most of it. Investing in bitcoin is volatile but the payoffs sure are worth it. 

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