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How to make money by investing in Bitcoin

Cryptocurrencies have become the buzzword over the past decade due to the advantages they offer over traditional currencies and traditional banking systems. Many people believe that cryptocurrencies will become the most widely used currency units in the future. 

Cryptocurrency transactions have the following advantages over traditional banking transactions. They are:

Cryptocurrency transactions are 100% secure. 

Cryptocurrency transactions are precise to a very large degree.

Cryptocurrency transactions preserve the financial confidentiality of the trading parties completely.   

There are no additional charges involved in cryptocurrency transactions. 

Since cryptocurrency transactions have many advantages over traditional banking transactions, many people are willing to invest in cryptocurrencies like Bitcoin. In this article, we shall discuss how to buy Bitcoins and how to make profitable investments in Bitcoins. 

Where can you buy Bitcoins?

Cryptocurrency exchange websites are the only places where you can buy Bitcoins. There are several cryptocurrency exchange websites but only a few of them are popular. Most of the popular cryptocurrency exchange websites are based in the US. Some of the popular cryptocurrency exchange websites are:

Coinbase

This is the most popular cryptocurrency exchange website in the world. People in the US can easily link their bank accounts to this website. Coinbase offers quite a few types of cryptocurrencies that you can buy like Etherium, Litecoin, Bitcoin, Ripple, Libra, etcetera. 

Coinbase charges a convenience fee for every cryptocurrency transaction carried out on its website. This convenience fee varies from 0.5% to 1.49% of the transaction volume, depending on the region of the globe the transaction is done on. The convenience fee is always 1.49% of the transaction volume for credit card transactions funded by the US banks. 

Binance

Thiscryptocurrency exchange website offers 150 types of cryptocurrencies that you can buy, including the world-famous Bitcoin. This website charges a 0.1% convenience fee on all cryptocurrency transactions. This website recently added a facility that allows users to buy cryptocurrencies on credit. The move has been welcomed by many.

Gemini

This cryptocurrency exchange website offers cryptocurrencies like Bitcoin, Litecoin, and Zcash that you can buy. It charges a convenience fee ranging from 0.99 to 1.49%, depending on the volume of the transaction being carried out. 

Coinmama

This cryptocurrency exchange website offers cryptocurrencies like Monero (XMR), Litecoin (LTC), Bitcoin Cash (BCH), Ethereum Classic (ETC), Ethereum (ETH), etcetera that you can buy. 

If you’re making a cryptocurrency transaction on this website, its value should be equivalent to at least US $60. This website charges a convenience fee of 5.9% on all cryptocurrency transactions. The convenience fee is 10.9% if you’re making a credit card cryptocurrency transaction. 

How to invest in bitcoins?

The best way to invest in Bitcoins as of today is via the Bitcoin investment broker, Robinhood. Robinhood allows people to buy and sell Bitcoins on its website and it does not charge any commission or convenience fee for it. 

Robinhood may have been the first mainstream broker for bitcoin trading but it definitely won’t be the last. Other firms like Fidelity, Sofi Wealth, TradeStation, and Motif Investing have announced plans to offer cryptocurrency trading on their website soon. 

Bitcoin investment brokers are not the only way one can invest in Bitcoins or other cryptocurrencies. There are other ways to invest in cryptocurrencies like:

Bitcoin ATMs

These ATMs can be linked to a person’s bank account. Once a person’s bank account has been linked to Bitcoin ATMs, that person can buy and sell Bitcoins using Bitcoin ATMs. There are presently more than 3000 Bitcoin ATMs across the US. 

Other Bitcoin owners

You can buy Bitcoins from other people and you can even sell Bitcoins to them for regular money. You must be absolutely certain that your buyer or seller is a genuine Bitcoin trader before trading Bitcoins with him or her. 

Trading in Bitcoin futures

Just like regular Future and Options in scripts, there is Future and Options trading in Bitcoins as well but this form of Bitcoin trading is very advanced and is not meant for amateurs in Bitcoin. If you want to know more about how to do future and options trading in Bitcoin, kindly visit this website. 

Grayscale funds

You can invest (buy and sell) in Bitcoins via a digital currency asset manager like  Grayscale Bitcoin Trust (its ticker symbol is GBTC) or Grayscale Ethereum Classic Trust (ETCG). You can buy and sell Bitcoins via many discount brokers.

Factors to be considered before investing in Bitcoin

These are the things that you should seriously consider before investing in Bitcoin. They are:

The exchange website must be genuine

If you need to buy bitcoins initially, you need to register in a cryptocurrency exchange website. Initially, they will ask for some of your private and sensitive information like your Social Security Number (SSN), debit card number, credit card number, etcetera. 

If the exchange website you are registering in is not trustworthy, they could misuse your private and sensitive information, which could cause you a lot of legal and financial trouble.

No insurance

Your cryptocurrency investments are not insured by firms like the Securities Investor Protection Corporation. On the contrary, the US stock exchange investments are insured up to US $500,000 by the same firm. 

So you need to be absolutely sure about the scope of cryptocurrencies before registering yourself on a cryptocurrency exchange website. 

Among all the cryptocurrency exchange websites, only Coinbase provides some amount of cryptocurrency investment insurance but one can’t say that the financial transactions that take place on the Coinbase website are 100% secure. Your password can get hacked. 

Use your own private and secure internet connection

Whenever you’re doing financial transactions using cryptocurrencies, it is better to do it using your own private and secure internet connection. If you’re using open and unsecured public networks, there is a chance that your transaction could get hacked. 

Of course, cryptocurrencies like Bitcoin use highly secure encryption methods in their financial transactions. So the chances of your public or private key getting hacked are really slim but still, it would be better if you use your own private and secure internet connection while doing cryptocurrency transactions.

Conclusion

Cryptocurrencies definitely have a lot of advantages over traditional currencies or traditional bank transactions but one needs to verify the genuineness of one’s cryptocurrency exchange website before registering oneself in it. Otherwise, one’s sensitive and private information could be misused.

One also needs to be sure about the scope of one’s chosen cryptocurrency before trading on a cryptocurrency exchange website as cryptocurrency investments are not insured by any insurance firm. 

Generally speaking, as more and more people are using Bitcoins, the value of a Bitcoin is on the rise. So this is a good time to invest in Bitcoins or any other cryptocurrency.   

Sources

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