Aside from its payment solutions and decentralized features like fast and seamless transactions that only take a few seconds, fewer fees, and immutable blockchain, many users also see Bitcoin as a good investment option because of its tremendous growth potential in the market.
Bitcoin’s value is expected to rise in the following years, which is why users believe that investing in this cryptocurrency will make a good profit.
What is Bitcoin?
Bitcoin was created in 2009 and is one of the first digital currencies in the industry. It is based on a whitepaper that was published by Satoshi Nakamoto, a person or group of people who created this revolutionary innovation. Up to this day, the real identity of the person behind Bitcoin remains unknown.
The technology behind Bitcoin’s structure features a series of computers or nodes that validate transactions in a blockchain. Each block contains a collection of transactions made by Bitcoin users.
In addition, Bitcoin is the largest cryptocurrency when it comes to market capitalization. With a promise of lower transaction costs, Bitcoin aims to make a difference in the world of fintech by making online payments easier and faster.
Bitcoin investment options
Once you decide to invest in Bitcoin, there are plenty of options you can choose from. The first thing you need to do is to purchase a token through exchange platforms such as Coinbase, Binance, Kraken, and others. This is basically what Bitcoin investment is about. Cryptocurrency investors trade their tokens for another to see if the value will increase.
Here are the Bitcoin investment options you can choose:
Day trading
Day trading is a short term investment that involves keeping a cryptocurrency for a short period of time. This Bitcoin investment aims to just keep the cryptocurrency for a couple of minutes or hours and sell them by the end of the day to make a quick profit.
To become a day trader, you must have the knowledge and experience in the marketplace to avoid losing a lot of money. If you have the skills in technical analysis and chart reading, this is a good option for you.
You can begin day trading by purchasing Bitcoin on an exchange site. As mentioned earlier, there are plenty of crypto exchanges available. You just have to make sure that the site is legitimate.
Strategies in Day Trading
There are different types of techniques in Day Trading namely:
- Scalping – This is the most common strategy in Day Trading and it features getting profits from small price changes. With this, many day traders create loads of trades in just one day.
- Range Trading – In Range trading, traders look at the support and resistance levels of the cryptocurrency’s price ranges before deciding on when to trade the coins. The support and resistance levels are the minimum and maximum prices of the cryptocurrency.
- High-frequency trading – This strategy involves the use of algorithms and bots to make multiple trades in a short amount of time.
Hot wallet
When it comes to Day Trading, the hot wallet is ideal when storing your Bitcoin tokens. Online and desktop wallets including mobile applications are types of hot wallets.
If you want to use Hot Wallets, all you need to do is to register for an account. You don’t have to pay for anything when signing up on an exchange site. With Hot wallets, you can access your account anytime and anywhere using any device.
HODLing
HODLing involves investing in Bitcoin for the long term. HODL typically means ‘Hold On for Dear Life,’ and this is a common practice for investors who hold their coin regardless of the price. HODL is derived from the misspelt word of ‘hold’ that pertains to the buy-and-hold tactics in cryptocurrency.
When HODLing, the aim is to purchase Bitcoin while the price is still low and sell them once the price increases tremendously. This might take a long time, but once the prices are up to a thousand dollars, you will make a profit.
Cold wallet
In HODLing, the best option is a cold wallet. This type is a physical wallet in the form of a USB so you can store your tokens offline. With this wallet, you can keep your cryptocurrencies safe without the risk of being hacked.
Paper wallet
Paper wallets are also an ideal wallet in HODLing because this wallet has the keys and QR codes printed on a piece of paper. This is considered one of the safest ways to store your tokens after a cold wallet.
How to invest in Bitcoin
Before you invest in Bitcoin, make sure you have an account on a crypto exchange. Exchanges are sites where you can buy and sell cryptocurrencies in exchange for other digital assets.
The first thing you need to do is to set up an account with an exchange. Once this is done, you need to fund your account to begin trading. This can be done using your credit/debit card.
You can find a wide selection of crypto exchange sites online. Here are some of the established sites you can check:
- Coinbase – Coinbase is one of the top crypto exchanges in the globe that offers buying, selling, and trading of digital currencies. With Coinbase, you can purchase cryptocurrencies using your fiat money.
- Binance – Binance strongly focuses on altcoin trading and you’ll find a large variety of crypto and trading pairs at a lower price.
- Bisq – Bisq is an open network for both crypto and fiat-crypto deals that enables peer-to-peer exchange.
Invest in Bitcoin today!
Now that you know the different Bitcoin investment options, it’s time to take your pick and discover the advantages of investing in this digital asset. Take a risk and find out how much you can obtain from investing in Bitcoin.