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If yes, you know that in today’s economy of bears, bulls, booms, busts and business incubation– you never know what to expect from an investment.
That’s certainly true when you throw the Bitcoin market into your investment portfolio.
If you are looking for a way to diversify your investments, Bitcoin may be right for you.
But you can’t know that until we get into the bitcoin basics. Here are some friendly tips for beginner investors.
3 Basic Tips for Bitcoin Investors
If you’re an investor thinking about making an investment in Bitcoin, here are some basics to point you in the right direction.
How Can I Purchase Bitcoin?
Bitcoins can be purchased at market value on any Bitcoin exchange platform. Some such platforms include:
- Coinbase
- Mycelium
- Exodus
- CEX
- Bitfitnex
- Poloniex; and
- Bitstamp
To learn more about each of these, click here.
Where Will I Store Bitcoin?
Bitcoin storage depends on what form your coin takes. Most often storage includes using a digital wallet or hardware wallet. Here’s what you need to know:
Physical Bitcoin
Physical Bitcoin actually exists.
That’s to say some companies have come up with a way to make a small metal token that represents a sum of bitcoin.
The slightly inconvenient issue with that is if you are investing in coins you can’t sell fractions of a physical coin, so the investment remains in one lump sum throughout its life.
Physical Bitcoin as an investment can be stored in many of the same places you’d put physical money. The plus side of this approach is it’s genuinely considered a more secure form of storage.
Digital Bitcoin
Digital Bitcoin must be stored in a wallet. In fact, all Bitcoin users must have a wallet in order to establish a wallet ID required to own Bitcoin.
A number of companies supply Bitcoin wallets that can be downloaded to a users phone. Mobile storage of Bitcoin is a common approach to keeping the money secure.
Although, storing it online does leave the coin more vulnerable to hacking attempts.
Where Does Bitcoin Get Its Value?
The question of where Bitcoin draws its value is tough to answer.
At the foundation of the Bitcoin economy, you have real people throwing real currency into the Bitcoin marketplace. To some extent, Bitcoin is backed by real money.
But the intrinsic value of Bitcoin comes not only from the real currency people have put into it, but also the equity built because Bitcoin is the first major decentralized worldwide currency.
Bitcoin is social, it’s accessible. That’s equitable and rouses the intrigued of people who feed into its overall demand.
As your Bitcoin position grows, the fee math starts mattering. Kraken Pro’s limit order fees (0.16%) are significantly cheaper than Coinbase’s 0.60% simple buy. Worth switching once you’re buying regularly.
>Back to Bitcoin Basics
My take: Once the basics click — fixed supply, halving schedule, self-custody model — the next step is just buying some. Coinbase is the most accessible US on-ramp and the one I’d tell a first-time buyer to start with.
Start on Coinbase — Easiest Bitcoin On-Ramp for US Investors →
If you’re thinking about investing in Bitcoin, let’s get down to Bitcoin basics:
- Bitcoin is widely accessible for purchase
- There are options for secure storage
- You’re going to pay market value
At the end of the day, Bitcoin may be a good investment for you. To learn more about ways to invest in Bitcoin and other facts, visit our website here.
