Bitcoin is the most popular and well-known cryptocurrency, and it is frequently featured in the news due to surging and falling prices as well as the sometimes controversial nature of cryptocurrencies in general. Cryptocurrencies are, put simply, virtual currencies that are generally paired with social platforms or content purchasing platforms. They operate on blockchain based systems, which are basically electronic ledgers that record information about cryptocurrency transactions. Most internet users have likely at least heard of Bitcoin following its huge price increase in 2017. Trading in cryptocurrencies can be highly lucrative, and there are plenty of modern self-made millionaires to prove it.
Naturally, like all other investments, cryptocurrencies aren’t without their risks. They can be extremely volatile in price, and it’s near impossible to predict which cryptocurrencies will become popular and which will fade into obscurity. Some skeptics of Bitcoin are concerned that its blockchain has set the maximum amount of Bitcoin that can be made to 21 million. With well over 17 million Bitcoin already in circulation today, this raises some concern over whether the cryptocurrency can be scaled for widespread use. An advantage Bitcoin has over other currencies, however, is that a single Bitcoin can be divided as much as the owner wants. If you’d like to transfer simply .01 percent of a Bitcoin, that is possible, which makes the 21 million limit more of an abstract concept. Of course, before you can start really considering any bitcoin investment strategies, you’ll need to know how to first obtain it.
Set up your Bitcoin wallet
The first step to buying and trading Bitcoin or any similar cryptocurrency is setting up your digital wallet. There are many different wallet options which range in their features, security, and compatible platforms. Generally speaking, it’s best to have an online wallet set up with your exchange site and a backup offline wallet. An offline wallet is good in case your exchange site either goes down or is flooded with traffic so you can still access the Bitcoin your already have. These are some of the best bitcoin wallets available for use.
Find a Bitcoin exchange
Once you’re able to store Bitcoin, you’ll have to find a way to acquire it. While it is possible to mine your own Bitcoin, the process is complicated and requires a great amount of resources. Most find it simpler to just purchase already existing Bitcoin. There are several cryptocurrency exchange platforms out there, and some are much more limited or less trustworthy than others. Coinbase is probably the most well-known platform, but there are Bitcoin exchange comparison sites where you may find better platforms for your goals.
Signing up for these platforms will require some form of identification, such as a photo ID, and there may be additional rules for security purposes. If you’d prefer a more direct route to purchasing Bitcoin, it’s possible to join peer to peer services that allow you to purchase directly from a Bitcoin seller without the exchange platform. Accepted payment methods can vary based on your platform or peer network. Most will accept traditional currencies in exchange for cryptocurrency, but there are some platforms that only allow for different cryptocurrencies to be exchanged.
Whether you plan to sell your Bitcoin at a profit once you have it or you’re looking to exchange or spend it, you should be prepared to move at a moment’s notice. The value of Bitcoin can fluctuate quickly and drastically, so you need to have a plan of action well in advance to avoid making mistakes in a panic. There are many online stores where you can spend Bitcoin, but be sure to do your research to make sure they’re safe beforehand.
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