How to invest in Bitcoin
How To Invest In Bitcoin
Investing in BTC is similar to investing in stocks, except far more volatile because of the daily swings in BTC. Here are the steps to invest in stocks from the beginning:
Open a brokerage account at a firm that allows crypto investments
Deposit funds from your bank into the brokerage account.
Buy a stock using deposited funds (cash balance).
Later sell the stock for a gain or loss. Funds are returned to your cash balance.
The main difference with BTC is for step three; you buy BTC or another cryptocurrency instead of stock.
With BTC, the above flow is similar in most cases but it depends on the exchange or trading platform. In some cases, you can buy BTC using your credit card or by transferring funds from your bank account.
For other platforms, you must transfer BTC directly. This is known as a direct deposit of BTC.
We’ll discuss how to invest in BTC for US citizens. The methods vary across countries because of differences in laws and regulations. Some countries require more private information than others to verify you are legitimate.
How To Deposit USD To Buy Bitcoin And Crytpo
Coinbase is one of the most popular platforms and has a straightforward process. Some of the mentioned websites below will follow this same process. We love Coinbase because you get $10 if you invest $100.
With Coinbase, you open a Coinbase account and link your bank account or credit card. Then transfer funds from your bank account to purchase BTC or purchase using your credit card. Credit card purchases of BTC are the most expensive.
The mechanics of purchasing BTC involve entering a USD amount or a BTC amount. The website will then convert the other currency.
For example, if you enter in 500 USD, the website will fill in the BTC side with 0.0357 (or what ever the current BTC exchange rate is).
Once you have the amount filled in, click to purchase your BTC. While credit card transactions cost the most, they are also the fastest to complete BTC transactions.
Bank accounts can take up to a few days. Keep in mind that you will get the exchange rate at the time you purchased BTC.
If BTC goes up 1000 by the time your transaction completes three days later, you’ll miss out on the rise.
Where exactly does the BTC you’ve purchased go? After all, you haven’t invested it yet. Your BTC sits in what’s called a digital wallet. Most all exchanges have their own wallet that you use to contain your BTC.
Going back to the brokerage example, your cash balance is used to trade stocks. BTC in your wallet is used to trade BTC.
What about your USD?
Your wallet has a space for BTC and USD. If you deposit 10,000 USD and buy 5,000 USD of BTC, your wallet will look like this:
5,000 USD
0.34 BTC
Wallets are a big topic of discussion when talking about cryptocurrencies. We won’t go into depth with them but you can use a stand-alone wallet if you don’t want to use the exchange’s wallet. Electrum.org is one example of a stand-alone wallet. This can be desktop, mobile or website based.
People all around the world still fancy whether it is a good time to invest in Bitcoin or any other cryptocurrency. Bitcoin is the most significant cryptocurrency in the market, and it has gained attention from several nations and people across the globe. These cryptocurrencies are virtual assets that do not exist like traditional currencies. They facilitate the way we can do a transaction without any involvement from the third party. At present, we, as a sender or receiver, have to deal with a third party which facilitates a transaction. https://www.cryptoknowmics.com/news/how-to-invest-in-bitcoin