At this point almost everyone has heard of Bitcoin, especially after its meteoric price rise during the last few months of 2017. Now people everywhere are wondering how they can get in on the action.
However, very few people actually know how they can safely purchase and hold Bitcoin, as it is an asset unlike any other yet seen in the investing world.
Fortunately buying and selling Bitcoin is actually pretty straightforward. Here is a brief guide on how to buy your first Bitcoins.
Bitcoin Wallet
The first step to buying Bitcoin is to download a Bitcoin wallet. Your Bitcoin wallet will hold your Bitcoin keys, which are the codes that identify the Bitcoins that you own. Some Bitcoin wallets also allow for the direct purchase of Bitcoins through their program, while others are just a means of storage and require that you access a Bitcoin exchange to buy your first Bitcoins.
Bitcoin Exchange
By far the most popular Bitcoin exchange is Coinbase. Coinbase allows you to safely buy, trade and store your Bitcoins all on one easy-to-use app. Coinbase is the largest Bitcoin-based company, and services more than 13 millions users worldwide.
Once you have registered for Coinbase, all you need to do is link a bank account. Once the account is cleared for transactions, you can deposit money into your Coinbase account and start buying and selling Bitcoins.
Remember to use a 2-factor authenticator to secure your account.
Bitcoin Fractions
With Bitcoin currently hovering around $15,000-$20,000 per unit, it is unlikely that many new investors will be buying a few whole units of Bitcoin. Fortunately Coinbase allows you to purchase fractions of Bitcoin, so even if you only have a few $100, you can still get in on the action.
The Bitcoin fractions also mean that investors can buy exactly as much Bitcoin as they want without getting turned off by the large investment per unit. Instead of settling for 3 Bitcoins when you can afford a little less than 4, you can purchase the amount of Bitcoin that perfectly suits your investing strategy.
Investing in Bitcoin: Trading or Buying to Hold
There are many ways to invest in Bitcoin, most of which fall somewhere between buying and selling on a regular basis or just buying it to hold. The general upward trend of Bitcoin has so far made buying at any trough and then selling on the inevitable rise a safe and highly profitable bet. However, this type of trading takes a lot of nerve, and easy profits can turn into dizzying losses if you do not have the temperament for this type of investing.
It is up to you to decide the investing style that is right for you. However, every Bitcoin investor needs to be aware that Bitcoin is a highly volatile asset, and there will be significant price swings no matter which way the overall Bitcoin price is trending.
If you still want to invest in Bitcoin, but the thought of wild price swings make your stomach turn, do yourself a favor and avoid the temptation to constantly check the price. Set your targets for entering and exiting your trade, and then just let the chips fall where they may. Gluing your eyes to every tick up and down will just stress you out and lead you to make impulsive decisions.
A Brand New World of Investing
You are now fully prepared to start investing in Bitcoin. Welcome to the exciting and lucrative world of Bitcoin investing!