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Do you know that all cryptocurrencies are actually behaving like stock in stock exchange? You see.. as more people are buying a cryptocurrency like Bitcoin, the price of the currency will rise. On the flip side, when less and less people are buying it, the price will go down.
That said, the original value of the Bitcoin itself and how you make the purchase is nothing like making an investment in public companies’ shares. Before you learn how to buy Bitcoin stock and how exactly you can profit from it, you should know the basics first.
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Understanding How Bitcoin Works
Bitcoin is a type of cryptocurrency, which is a digital asset, designed to work as an exchange media for exchanging resources. Bitcoin is considered to be more secure than conventional currency as you don’t have to go through a bank or any payment entity when you want to do a transaction. You can do everything online from your computer in the comfort of your home. That is because unlike regular currency, Bitcoin just like any other types cryptocurrency, is a decentralized currency, in which every transaction or coin exchange is recorded and stored safely in a digital ledger with a highly secure cryptograph.
This currency can be traded for a product, sold for conventional currency, and can also be bought into just like a stock.
To get a better picture, you can imagine Bitcoin as a token used for bartering purpose, but the amount of these tokens is limited. Just like gold, Bitcoin is a non-renewable resource that cannot be produced, it can only be mined. But unlike gold where you have to dig a hole on a mountain to retract it, Bitcoin is mined with software using the blockchain technology.
Another difference between Bitcoin and gold is that even though both are considered to be limited resources, Bitcoin is really volatile in value as opposed to gold that is quite stable. Today Bitcoin’s usage has evolved so greatly, and people also buy into it with various different reasons.
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How Do You Buy Bitcoin Stock?
Whatever your reason to buy Bitcoin, whether you want to exchange it for other resources, or just as an investment to be liquidated later when the price is good, there’s a universal process that you need to follow:
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1. Get a Bitcoin Wallet
This wallet is actually an online storage space for digital currency, that holds a unique identifier also known as “key” that is assigned to every owner of Bitcoin. This key is actually a code that consists of a long string o numbers and letters keeping your Bitcoin secure.
So before you start your hunt for Bitcoin, you need to download and setup your digital wallet and connect it to your debit or credit card. Today you can find many Bitcoin wallets available that can be used on your desktop computer or mobile device.
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2. Find a Bitcoin Exchange
Just like stock being traded in stock exchanges, Bitcoin is traded in Bitcoin exchanges. Currently there are so many online cryptocurrency exchanges operating from different places all around the world providing you with a trading platform to buy/sell Bitcoin. Some Bitcoin exchanges are even available all around the world, like eToro that’s accessible in almost every country in the world.
You need to register with one of these exchanges in order to use their platforms to buy your Bitcoin. Usually the process is pretty simple, you’ll just need to prepare your email account and debit/credit information. No matter which Bitcoin exchange you choose or which country it operates from, the Bitcoin price will be the same, however transaction fees might vary from one exchange to another. You can look for and find a reliable stock exchange on smartbitcoininvestments.com.
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3. Choose the Buy-In Amount
Every Bitcoin exchange works pretty much the same way, so after you have completed the registration process, if you want to continue purchasing Bitcoin then you simply need to go to the “Buy” section. There, you can choose your buy-in amount and link your Bitcoin wallet that you’ve already setup at the beginning. Your exchange might have a Bitcoin storage place included on your account, but for your own security, if you intend to keep your Bitcoin for a while it is highly recommended that you setup your own wallet outside of the exchange.
So how much do you need to spend if you want to purchase Bitcoin? As we know the price of Bitcoin is pretty high, so if you don’t have thousands of dollars in your account can you still buy Bitcoin? The answer is yes, fortunately. You can even buy $1 worth of Bitcoin, many exchanges actually allow you to do that. So don’t worry if you don’t have a huge budget, because you can still invest in Bitcoin even for $1.
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4. Decide What To Do With Your Investment
After purchasing Bitcoin, basically you have two options:
Option 1: Go to a cryptocurrency marketplace and spend your Bitcoin
Even though Bitcoin has been increasingly accepted in the world, but it still has a long journey to be widely accepted like conventional currency. Fortunately there are a lot of cryptocurrency marketplaces where you can spend your Bitcoin and exchange it for products. Various products are available in these marketplaces, from physical products that can be delivered to your home or on physical products like software.
Some of the most popular Bitcoin marketplaces are Glyde, Bitify and BitMarket which is a Reddit community. Not only you can spend your Bitcoin in these marketplaces, but you can also sell products to be traded with Bitcoin, so these places could also help you grow your investment.
Option 2: Buy and wait
Many Bitcoin investors think that the best way to manage your Bitcoin investment is actually to buy in and let it sits in your wallet. Bitcoin values can fluctuate like crazy, you can see it going up or down hundreds of dollars over night. So just like in any other type of investment, you have to be ready to win big or lose big, just make sure that the money you put into your Bitcoin investment is the money you can afford to lose. However, usually if you can hold on to it for a long enough time, it will pay off eventually, and many people have actually enjoyed a huge profit from their Bitcoin investment.
