Thinking About Investing in Bitcoin? Here’s What You Need to Know

by Mike on December 30, 2018

Thinking About Investing in Bitcoin? Here's What You Need to Know

Thinking About Investing in Bitcoin? Here’s What You Need to Know

Back in mid-January 2017, the price of Bitcoin ranged somewhere around the $750 mark, which was a record low in many months after crossing the $1100 mark just days before. However, by the end of the year in mid-December, 2017, the price of Bitcoin had risen by 1,824% to almost the $20,000 mark! While the price has been falling quite sharply ever since then, coin traders know that this is actually the perfect time to start investing in the cryptocurrency once again because the market value of Bitcoin is about to rise again in 2019. However, if you are only thinking about investing now and have not done so yet, it’s actually a great time for that and here are a few pointers that will help you get introduced to the basics of investing in Bitcoin.

The Price of Bitcoin Fluctuates Heavily

While constant fluctuations are par for the course when it comes to trading currencies in general, the price of Bitcoin fluctuates immensely and unpredictably at times. As it stands now, Bitcoin has been showing signs of improvement lately and predictions suggest that in 2019, the prices will again start to go up by leaps and bounds, making now the right time to invest in the cryptocurrency. Nonetheless, due to the unreliable nature of Bitcoin, it is suggested that you make small investments in the beginning to get used to the market first.

All Bitcoin Traders Need to Stay Updated Constantly

The difference between profit and loss while buying and selling Bitcoins is basically determined by how updated you are with the latest coin prices and trends. Find a source of constant market updates like Coin.Live and stay in sync with everything, because as long as you are looking to make money, every subtle change in price and pattern matters here.

You Will Need to Sign Up at a Bitcoin Exchange

Bitcoin exchanges like Coinbase, CoinMama and LocalBitcoins are platforms for buyers and sellers to interact and conduct business with each other. Most of them will charge a percentage fee for each transaction on their respective platforms, but there is no fixed rate and they do differ quite widely. Be sure to only sign up with reputed and verified exchanges such as the ones already mentioned because frauds are not unheard of here. Technically, you will also need a Bitcoin wallet to store your coins (private keys to be exact), but on signing up with an exchange, it should be provided to you automatically by the exchange service, albeit for a price in most cases.

Understanding the Usefulness of Bitcoin

Even if you only use Bitcoin for trading, it is essential to know what these cryptocurrencies are useful for, so that you can connect dots from the news and updates in the worldwide market and predict outcomes to some degree of accuracy while trading.

  • Every transaction done via Bitcoin is private, secure and verifiable
  • International financial restrictions do not affect Bitcoin transactions; send and receive money to and from anyone, anywhere
  • Cryptocurrencies are the future and Bitcoin is the pioneer currency of that future

It is Almost Impossible to Profit from Bitcoin Mining for Newcomers Now

There are Bitcoin mining corporations at work in China that have thousands of specialized mining machines at their disposal, and even they have reported a steep decline in returns. Due to the finite nature of Bitcoin (21 million), it gets progressively harder and more expensive to mine these electronic keys, and given that there are less than 4 million Bitcoins left in the world right now, investing thousands of dollars in Bitcoin mining is a bad idea for everyone.

Before you get used to the feel of the market, a rule of thumb is to invest only what you can afford to lose. Anything more than that is ill-advised for beginners.

Previous post:

Next post: