What is Bitcoin?
Bitcoin is a decentralized, peer-to-peer digital currency system designed to give online users the ability to process transactions through a digital unit of exchange known as Bitcoins. In other words, it is a virtual currency.
The Bitcoin system was created in the year 2009 by undisclosed programmers. Since then, Bitcoin has attracted a great deal of attention and controversy as an alternative to the US dollar, the euro, and commodity currencies such as gold and silver.
Rise to popularity
Bitcoin had not attracted much attention in the world of business and finance before the year 2009. It rose to fame in the period 2011-2012 when it gained more than 300%. Bitcoin has seen a 400% growth in value since August of last year. As a result, venture capital firms and investors around the world continue to place importance on cryptocurrency.
In the first half of 2014, venture capital firms invested $57 million in Bitcoin in the first quarter, followed by another $73 million in the second quarter for a total of $130 million, which is 50% more than the total for the year. past $88 million. This is a complete contrast to the scenario in 2012, where Bitcoin companies amassed a relatively meager sum of $2.2 million.
These statistics prove beyond a shadow of a doubt that Bitcoin is worth investing in, which begs the question: how can you buy and invest in Bitcoin?
A guide for novice Bitcoin investors
The easiest and least complicated method to invest in Bitcoin is by buying bitcoins. There are many established companies, mainly in the US and abroad, that are involved in the business of buying and selling bitcoins, BTC for short.
base of coins
If you live in the US, Coinbase is the place you are looking for. Coinbase provides its customers with BTC at an estimated 1% markup on the existing market price. United States residents have the option to sync their Coinbase wallets with their bank accounts. As a result, future payment transfers go smoothly. This company also gives you the option to buy bitcoins automatically from time to time. For example, if you are interested in buying $50 worth of bitcoins at the beginning of each month, Coinbase allows you to set up an automatic purchase for that amount.
Please be aware of the terms and conditions before you start using this service. If you have subscribed to an automated bitcoin service, then you will not be able to control the price at which BTC is purchased each month. Please note that Coinbase does not function as a Bitcoin exchange, i.e. you buy and sell the coins directly from the company. Since the company has to source the coins from other buyers, it may face delays or interruptions when placing orders during rapid market movements.
bit stamp
BitStamp follows the requirements of a conventional bitcoin exchange. Bitcoin acts as an intermediary that allows you to trade with other users and not with the company itself. Liquidity is higher here and you always have a good chance of finding someone willing to trade with you. There is an initial fee of 0.5% which can be reduced to 0.2% if you trade $150,000 in a 30 day period.
Alternative ways to buy Bitcoins
local bitcoins
The exchange is not the only method to invest in bitcoins. Local Bitcoins are often used to buy BTC offline. The website is designed to link potential buyers and sellers. Bitcoins are locked up by the seller in escrow and can only be delivered to buyers.
Buying bitcoins offline is not always very reliable or secure. Therefore, it is preferable to meet vendors during the day and let a friend accompany you in case things go wrong.
Bitcoin is not just a modern trend. Venture capital firms consider Bitcoin to be a decent substitute for conventional currency in the long run. There are non-coin ways to enter the bitcoin investing sphere. As mentioned above, Coinbase, BitStamp, and Local Bitcoins are the most popular channels to invest in bitcoins in the United States. Do your homework and find out which avenue ticks all your boxes.