More and more people are looking into investing in Bitcoin, with the cryptocurrency having been breaking all kinds of records in 2021.
Today, there’s no need to be a computer geek or a trader to be investing in Bitcoin or other cryptocurrencies out there – which is now accessible to everyone, so long as you follow a few basic rules.
Public interest in cryptocurrencies may be growing, but people don’t always know how to go about actually buying them. The most simple means of getting started is to sign up to a cryptocurrency exchange platform. These online marketplaces are, for the most part, relatively easy to use. Some of the best-known are Coinbase and Coinhouse, which can be accessed via a web browser or through dedicated mobile applications.
Once signed up, users have to confirm their identity then enter a payment method for buying Bitcoin or receiving payment when converting Bitcoin into local currency. In both cases, bank transfer or bank card transactions are possible. However, fees are usually debited for each transaction, and these are generally higher for card transactions.
Beginners are advised to start with investing in Bitcoin (the best known cryptocurrency) which is currently seeing the most impressive growth. You can easily get started with less than $50, before branching out to more calculated investments in other cryptocurrencies on the up. There are dozens of them out there, some more serious than others, and with varying potential for returns.
The case for bitcoin
Although its price is skyrocketing, beating record after record for several weeks, and it is sometimes seen as a safe investment, buying Bitcoin can still be a risky business. Beginners should also beware of falling for far-fetched online offers and free Bitcoin fractions.
For centuries, gold has been seen as a go-to safe-haven investment. However, it could soon be overtaken by Bitcoin and other cryptocurrencies among younger generations. Rather than investing in property or putting bullion in the bank, young adults born in the 1980s and 1990s are being drawn to invest in Bitcoin. In fact, 67% of millennials polled said that they think Bitcoin competes better against gold as a safe-haven asset, according to a survey published by the deVere Group.
The most optimistic economists think that the price of the cryptocurrency could top $250,000 from the end of 2021 – more than a 10-fold increase in the space of a year! Needless to say, that gives weight to the poll’s findings.
Bitcoin has been on a meteoric rise since March last year, when it stood at $5,000, spurred by online payments giant PayPal saying it would allow account holders to use cryptocurrency. And in a further boost, Tesla unveiled plans to accept the cryptocurrency from customers buying its vehicles.
Mastercard plus US financial giant BNY Mellon have meanwhile agreed to accept digital currencies as payments, even as many regulators remain sceptical. While Twitter chief Jack Dorsey and rap mogul Jay-Z are creating a fund aimed at making bitcoin “the internet’s currency.”
Bitcoin, which was launched in 2009, made headlines in 2017 after soaring from less than $1,000 in January to almost $20,000 in December of the same year. The virtual bubble then burst in subsequent days, with bitcoin’s value then fluctuating wildly before sinking below $5,000 by October 2018.
However, strengthening corporate support has transformed the outlook this time around, commentators say. “Growing corporate support for the crypto makes this a very different market to what it was in 2017,” noted Markets.com analyst Neil Wilson.
In response to the rapid rise of cryptocurrencies and the dwindling global use of cash, a number of central banks have announced plans for bank-backed digital units. Unregulated by any central bank, bitcoin emerged as an attractive option for investors with an appetite for the exotic – although criminals have also picked up on its under-the-radar appeal.
Yet debate still rages over the status of the digital asset, as to whether it should be seen as a form of money, an asset or a commodity.
Bitcoins are traded via a decentralised registry system known as a blockchain. The system requires massive computer processing power in order to manage and implement transactions. That power is provided by miners, who do so in the hope they will receive new bitcoins for validating transaction data.
This article was published via AFP Relaxnews