Investing in cryptocurrencies can be confusing experience
Where do I begin and what option do I have?
We will cover three options for investing in bitcoin or any other cryptocurrency.
The first is buying actual bitcoins and storing them inside your personal bitcoin wallet.
This method is probably the most complex, but also our most recommended way to invest in bitcoin of the three.
with this option, you'd need to find a bitcoin exchange, deposit money into it and convert that into money.
Once that's done, you'll need to get a bitcoin wallet so you can move your coins off the exchange and into that wallet for safekeeping.
The second option for investing in bitcoin is derivatives trading.
With derivatives, you won't be buying the actual coins.
Instead, you're buying a contract that mimics the coin's behaviour.
IF THE coin goes up in price you can sell the contract for a profit but if the coin's price drops you're at loss.
With derivatives there's no need for a bitcoin wallet since you don't actually own bitcoins.
Just open an account, deposit money and start trading.
Derivatives also allow for leveraged trading
Which means you can borrow money to increase the amount you want to trade.
However, this option is considerably more risky and is suitable only for experienced traders.
Finally, you can invest in a bitcoin exchange traded fund or bitcoin ETF for short.
Investing in an ETF also means you're buying a contract and not an actual coin.
ETFs are traded on regulated stock exchanges and try to mimic Bitcoin's price moves although they might not reflect Bitcoin's price with complete accuracy.
Today, there are still only a handful of Bitcoin ETFs available.
ETF investing is geared toward the average investor who doesn't want to deal with opening accounts or downloading wallets.
You can invest in an ETF the same way you invest in stocks through your bank, financial advisor, or conventional trading platform.
So there you have it:
This are my top three best ways you can invest in bitcoin today.
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