Articles

How To Invest In Bitcoin Stock

by Pradeep S. Digital Marketing Strategist
When it comes to investment products, Bitcoin has been a subject of pros and cons among investors. It is true that some Bitcoin investors have enjoyed some ginormous amount of profit from their investment, especially during the Bitcoin boom in 2017, but the number of investors who experienced a huge loss from their Bitcoin experiment is also great, especially during the Bitcoin crash during the period of January to February 2018.


So basically Bitcoin is like any other investment, there’s a potential for a huge profit and a huge loss. Just make sure you know exactly what you’re going into when you decide to invest in Bitcoin, so whatever decision you make, you are making it based on knowledge. If this is the first time you are investing in cryptocurrency, you can just start small while learning your way around the crypto business. There’s one magic rule known to every experienced Bitcoin that says “never invest more than you can afford to lose”.

Starting out with bitcoin stock as an investment is very easy, just a few simple steps and you’re in the game. Here are a few important steps you need to take in making your Bitcoin investment.

Decide Where And How You Want To Obtain The Bitcoin

You can purchase Bitcoin in a few different ways. The most popular way is to purchase it through Bitcoin exchanges. Another popular method is to buy from traditional brokers. Then there are also other least popular ways, including through Bitcoin ATMs, Bitcoin futures, Grayscale funds, as well as peer to peer.

1. Bitcoin Exchange

It’s not difficult to find Bitcoin exchanges today, no matter where you are in the world or what currency you are using, you can always find an exchange that can provide you with the service you want. Basically these exchanges operate the same way and offer similar services, but in details, there could be a lot of differences.

Some exchanges are built for experienced investors, and some are built for both experienced and new investors with more user-friendly platforms. These exchanges also charge different fees on each transaction. Some of the most popular Bitcoin exchanges are:

  • Coinbase: For US buyers, Coinbase is a really popular choice. It offers various cryptocurrencies and it provides an option for you to link your bank account, which offers cheaper fees on your transactions.
  • eToro: This exchange is a perfect platform for beginners while still providing great services for experienced investors. eToro is a unique exchange that established the first social trading platform, which allows a trader to follow other traders in doing the trading. This is a perfect platform for new traders to learn how to make a profit by following experienced traders. Their service is available worldwide in almost all countries, it has a good reputation with a wide range of cryptocurrencies available, and they even has the option to open Islamic accounts for traders who follow the Sharia law.
  • Gemini: This is another popular exchange based in the US that has a good reputation among Bitcoin buyers. Transaction fees in Gemini are relatively low, ranges from $0.99 to 1.49% of your total order amount.
  • Coinmama: Besides Bitcoin, Coinmama trades 7 other cryptocurrencies. It charges 5.9% fee for every transaction with a $60 minimum purchase. If you purchase with credit there will also be an additional charge of 5%.

2. Traditional Stockbrokers

Surprisingly many Bitcoin buyers still don’t know that they can also buy Bitcoin from traditional stockbrokers, perhaps because there isn’t so many of them that offer cryptocurrencies.

Robinhood is the most popular traditional stockbroker that offers Bitcoin, and also the first one to do so. Today their service is available in most US states. The great thing about Robinhood is that it charges no fees in Bitcoin trading, just like in its stock trading platform. Another well-known stockbroker that’s trading Bitcoin is TradeStation.

3. Other Options

  • Bitcoin ATMs: Just like any other ATMs, these facilities offer a quick and convenient way to buy and sell Bitcoin. There are currently about 3,000 Bitcoin ATMs in the US.
  • Bitcoin Futures: This is not a recommended method for beginners, but there are some reputable platforms if you’re interested in trading on Bitcoin futures.
  • Grayscale Funds: Grayscale has two investment trusts; GBTC (Grayscale Bitcoin Trust) and ETCG (Grayscale Ethereum Classic Trust). These are publicly traded so anyone can purchase them through brokers.
  • Peer to Peer: This is a very simple method to buy Bitcoin, where you simply purchase it from other Bitcoin owners. There are many peers to peer platforms like LocalBitcoins, Bitquick, Bisq.

Important things to know before you buy

  1. Creating a new account in a Bitcoin exchange is pretty simple, but you will be asked for various information during the verification process, including social security number, bank account number, debit/credit card info, some exchanges might even ask for a picture ID. Prepare everything so you can verify your account fast and start purchasing your Bitcoin.
  2. You can make a lot of saving when using a bank account to fund your Bitcoin purchase. Besides you will be paying much lower fees, you will not have to be responsible for paying high interest like when you use a credit card.
  3. Bitcoin investment is not insured by the Securities Investor Protection Corporation.
  4. Make sure you only use a secure, private Internet connection to ensure the safety of your investment.

Setup A Digital Wallet

There are two options for you to store your Bitcoin, a hot wallet or cold wallet. A hot wallet is basically a form of software provided by the exchange or third party provider that can be accessed through an app on your mobile device or from your computer. It’s recommended to use a hot wallet from third-party provider because it’s considered safer, especially if you want to keep your Bitcoin for a long time.

The cold wallet is considered to be a much safer option. It’s basically a portable device that you can use to download your Bitcoin and keep it in a safe place away from the reach of any hacker. However, it’s actually a less practical option when compared to a hot wallet. The cold wallet is highly recommended if you have a large amount of Bitcoin to keep.

Make Your Purchase And Manage Your Bitcoin

When everything is all set, you can go ahead and make your purchase. Don’t worry if you don’t want to spend too much money on your first purchase, because even though 1 Bitcoin worth thousands of dollars, Bitcoin actually can be traded in fractional shares.

Do some research, take your time and learn how to manage your investment in order to gain profit. An exchange like eToro that has a social trading platform could be very useful to help you learn how to profit from your investment.


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About Pradeep S. Advanced   Digital Marketing Strategist

78 connections, 0 recommendations, 213 honor points.
Joined APSense since, June 13th, 2013, From Delhi, India.

Created on Jun 18th 2020 23:50. Viewed 176 times.

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