Understanding How to invest in bitcoin and make money for Beginners is so complex. In 2009 Bitcoin was introduced together with blockchain. It was the first time the world was witnessing a genuinely decentralized payment system.
Bitcoin first started as a currency meant to replace fiat money, but over time its value increased, making it a sort after commodity like gold.
How to Invest in Bitcoin and Make Money for Beginners
Within the past 12 years, there has been an introduction of different ways people can earn through Bitcoin, millions have been made. If you wonder how to make money with Bitcoin, this article will walk you through, but first, let’s find out what Bitcoin is.
So today, we will be talking about How to invest in bitcoin and make money for Beginners.
Bitcoin is a decentralized digital currency that can be exchanged electronically. It is bought, sold, and exchanged without the involvement of an intermediary.
Satoshi Nakamoto described Bitcoin as “an electronic payment system based on cryptographic proof instead of trust.”
Just like I stated above, it is a decentralized digital currency. This means all transactions made with Bitcoin are accessible by everyone on a ‘public ledger.’ Since it is public, Bitcoin transactions cannot be altered or manipulated.
The government does not back Bitcoin, neither is it issued by a central bank. Instead, new Bitcoin is generated through a process known as mining.
Most financial news media has recently been buzzing with news about Bitcoin; it has also been a topic of discussion among friends and colleagues; this draws the question; why Bitcoin?
For a start, Bitcoin has value thanks to scarcity. Its availability determines the value of a commodity; a readily available commodity will naturally lose value. Getting new Bitcoin is called mining, and mining is a complicated process that gets even more difficult by the day. Currently, there is only 18,740,718.75 Bitcoin in circulation.
The utility is another factor why you should consider Bitcoin. A currency will be useless if its holders can’t spend it. Bitcoin has utility and has been used as a medium of exchange since it was first used to buy pizza.
This is a tricky question because the answer is relative. It is a good investment if you have apt knowledge about what Bitcoin trading involves and you are ready to trade with money you are willing to lose. But a bad investment for those who know little or nothing about investing in Bitcoin.
Millions have been earn by Bitcoin traders; millions has also been lost; what makes the difference between the earners and looser is knowledge. That is why before you put a dime into Bitcoin, you need first to carry out thorough research on how to invest in bitcoin.
Yes, there are risks in Bitcoin, just the same way there is risk in every other form of investment.
The risk associated with investing in Bitcoin includes:
The crypto market is very volatile; its value can change within a minute and then again within the next minute. You cannot predict the value of Bitcoin, so it becomes risky, especially if you are new to the market.
But if you know how to make money with bitcoin, you will cash by exploring the volatile market.
Many people are looking for how to invest in bitcoin. This has opened opportunities for fraudsters trying to exploit the vulnerability of desperate investors. Different schemes promise incredible ROI, and no matter how fictitious they appear, several people still fall victim.
There are stories of people who have lost their Bitcoin to cybercriminals, especially on exchanges.
One of the features of Bitcoin is anonymity. This is also a disadvantage because Bitcoin stolen cannot be traced. To be on the safe side, secure your Bitcoin in a reliable wallet.
The answer is No. Several pyramid investment schemes involve Bitcoin; this does not make Bitcoin a pyramid scheme. Besides, many investments involve fiat; this doesn’t make fiat a scam, does it?
Bitcoin is decentralized without any form of a pyramid structure; this makes it impossible to manipulate.
For most parts of the world, it is legal, the legality of Bitcoin is subject to change, and the level of regulation by country varies. China, for instance, placed a heavy restriction on Bitcoin how dealing with Bitcoin within China is not illegal. India and Nigeria, on the other hand, banned banks from transactions involving Bitcoin. But as of June 2021, Bitcoin is legal in U.S., Japan, the U.K, and other developed countries.
If you are wondering how to make money with bitcoin, it is simple as long as you don’t fall for one of the numerous scam schemes out there, here are three reliable ways you can make money with bitcoin:
Mining: This is the primary way of making money through Bitcoin. Mining bitcoin involves solving complex mathematical and creating new blocks in the process. For each block you create, you will be rewarded with Bitcoin.
Mining used to be easy, but as more and more people indulge in mining, it has become more complex. This shouldn’t discourage you from going into mining. With a good computer and reliable and affordable electricity, you can start mining. You can join a Bitcoin mining pool or mining cloud to make the process easier.
Buying and Holding
Buying and holding is a simple answer to the question of how to make money with bitcoin. This investment strategy is also called HODLing. It involves buying Bitcoin when it is affordable and selling when the price goes up, making a profit with the difference between your purchase price and selling price.
This is a little bit more technical than buying and holding. Unlike HODLing that takes place over a long period, trading is more fast-paced. Traders take advantage of the volatile market, so if you want to go into trading, be sure you understand the market and how it works.
There is no limitation to the amount you can invest in bitcoin; some trading platforms allow traders to start trading with less than $50. However, any amount you want to invest should be money that you are willing to let go of. Don’t invest with borrowed funds and money set aside for other commitments.
If you want to trade with Bitcoin, it is advisable to start with little money, but if you want to HODL, you can stake a more considerable amount because the more you invest, the more your profit.
Now that I have answered how to invest in bitcoin, why not give them a try? Remember to take things a step at a time.
I understand that there are risks involved, but every other investment has its risks. Don’t forget to carry out your research, get other resources like ebooks, and above all, trust your guts.