Bitcoin has evolved into one of the most popular digital cryptocurrencies in the entire world. There are millions of people trading Bitcoin on traditional cryptocurrency exchanges every single day, but there are several other things that you are probably going to watch to know before you purchase any Bitcoin for yourself.
3 Things to Know Before Investing in Bitcoin
What Exactly is Bitcoin?
Bitcoin serves as a digital currency that can be traded and exchanged on popular platforms like Coinbase and Binance. Bitcoin is a global digital currency that can be purchased just about anywhere in the world where it is legally allowed to do so, including North America, Australia, and many other countries and continents.
Bitcoin transactions take place on something recognized as a blockchain. Any time that a person sends any amount of Bitcoin to another digital wallet, a blockchain transaction takes place and the process of sending the currency begins. This process takes place with most cryptocurrency, but Bitcoin is certainly the most popular with a significantly higher market-cap than most other alternative cryptocurrencies.
What is Bitcoin Used For?
There are multiple reasons as to why you might want to obtain Bitcoin. We are going to briefly cover all of these interesting reasons. The most common reason that people purchase Bitcoin is to invest in it. Cryptocurrency is unregulated in many ways, and for one reason or another, people really like to invest in it. Some users like it because it is extremely volatile, while others simply believe that it will evolve into a singular digital currency that will dominate global markets in the future.
For one reason or another, most people believe that the value of Bitcoin will go up over time, especially since digital Bitcoin will become mathematically harder to obtain as time progresses into the future.
So to make things as clear as possible, investing is the most popular activity that people associate with Bitcoin. Digital exchanges are easy to sign-up for and users can trade Bitcoin at any hour of the day on many exchanges, including the popular Coinbase platform. With a market cap well over 200 Billion Dollars, nobody truly knows what the limits are for Bitcoin, but at the time of writing this post, Bitcoin trades at more than $10,000 American Dollars per Bitcoin. There are people that purchased Bitcoin when it was valued at less than $100 American Dollars, and that goes to show how much potential there could be in the future of Bitcoin.
Investing is not the only reason that Bitcoin might be used in any given situation. A lot of people use Bitcoin for anonymous transactions and sending large sums of money swiftly without a middle-man. Various retailers are starting to accept digital cryptocurrencies in some countries, but the world is still a long way from global Bitcoin domination.
Popular Bitcoin Activities
- Long-Term Investing
- Short-Term Investing (Day-Trading)
- Utilizing Anonymous High-Speed Blockchain Transactions
How to Buy and Sell Bitcoin
As we previously mentioned, Bitcoin can be obtained in many countries through a digital cryptocurrency platform. The most popular ones are Binance and Coinbase, but there are many others as well that you might be interested in considering. Some platforms have significant fees, but every platform has its own positive and negative features to consider before signing up.
After verifying your account on a cryptocurrency exchange, there are two primary ways to protect your digital currency. One way is to secure it through a cryptocurrency wallet, and these come digitally as well as in physical hardware wallets. The other way to protect your Bitcoin is to simply hold it on the exchange that you bought it from until you are ready to sell it.
The process of buying and selling Bitcoin is less regulated than the stock markets in most countries, but the fees are oftentimes significantly higher. This is an important factor to consider before making your first Bitcoin transaction on a cryptocurrency exchange.
Where Can you Buy Bitcoin?
Bitcoin can be purchased from just about anywhere. You can buy bitcoin in Australia, America, Canada, Japan, and several other countries. There are only a few locations where Bitcoin is banned entirely. One example is Ecuador where the Bitcoin digital currency is completely banned by the government.