The future of digital currency is destined to be most captivated by the world largest cryptocurrency, Bitcoin. Investing in Bitcoin not only gives you the liberty to operate without central control but also lets you enjoy the perks of virtual currencies.
To be part of this digital domain all you need is a good start in Investments. Those who have invested in cryptocurrency opine that these can potentially cause an invention of new digital currency. Which could go up to millionaires or billionaires.
Invest in Bitcoin as a Beginner
As Bitcoin uses blockchain technology, it tends to eradicate any middlemen making the transactions very transparent and trusted. With the help of web networks and ledgers, they aid in promoting varied new types of financial pursuits, which were never thought of earlier.
Gains of Investing in Bitcoin
- Its non-existence in papers secures the currency flow by avoiding seizures or printings
- Bitcoin has globally witnessed growth since its birth
- It has the potential to bring in evolutionary changes in the industrial infrastructure
- Only after undergoing a rigid pattern of security measures, one is eligible to buy a Bitcoin
- The primary aim of the cryptocurrency is to erase all the probable mid-way agencies to execute node to node economic action
- The blockchain technology implemented by Bitcoin is undoubtedly the game-changer for future economic sectors
- A new form of digital gold is bitcoin. Its ability to be used as digital cash makes it a new form of digital gold for many investors.
Losses of Investing in Bitcoin
- Bitcoins are highly volatile in nature, one cannot predict the ups and downs related to it
- Bitcoins are not backed by governmental governance. So there’s a huge risk of getting trapped by luscious scams
- Usage of Bitcoins is also curbed. That is, you cannot use Bitcoin everywhere and whenever required like a debit or credit card.
- Being completely web operated, Bitcoins impose a high risk of hacking or other cyber threats
- Transactions made in Bitcoin are not reversible. Sending of wrong amount or sending the appropriate amount to wrong receiver comes with no reversibility as your transaction are final
How Much Should You Invest as a Beginner
Investing in Bitcoin or other forms of cryptocurrency have their own structure of fluctuation. Some movements can earn you a wealthy sum whereas few might sink you to the bottomline.
Looking at the deep stoop of value sometimes you can surely comprehend the labile nature of Bitcoin. To start Investing in Bitcoin you have to roll your eyes through certain factors that would determine the track of your Investment-
Personal Factors
Personal Factors such as your net worth or risk tolerance capability have a huge role to play in investments. There are equal chances for you to either gain a huge return or lose you money completely.
Sharp Strategic Planning
For investing in Bitcoin you have to simultaneously craft your investing strategy so as to meet up the call of the hour. A planned strategy can help you overcome or avoid a catastrophic loss all together.
Look for the Optimal Platform
Investing in Bitcoin can be made much easier if you opt to buy them from a trusted exchange platform. You can also buy Bitcoin by investing in companies that have cryptocurrency on the balance sheets. This way you can own Bitcoins indirectly.
Tightened Security of Hot Wallets
Just like you store your cash in a wallet or purse, digital currency also needs to be stored in a Hot Wallet. It is a web operated wallet that can be accessed through computers, laptops and smartphones. Without a strong password, your funds can be stolen from the Hot Wallets.
How Much to Invest
Before you plunge into the world of cryptocurrency, it is good to know how much you should invest to avoid the stress of losing too much. You should either go for 2-5% of your net worth or 3% of your liquid assets.
You should never overlook the possibility of losing all at once. Investments should be weighed not on how much can be the return rather how much would you be affected by the losses.
Division of Investments
Instead of pouring all your corpus at once you can divide your budget and invest over a long and split period. This will help you to prevent all the potential expensive losses with a sharper skill of understanding the rate of fluctuations.
Portfolio Should be Diversified
To save yourself from any financial risks, you can start investing in many spheres rather than only in one. You can invest in stocks, real estate, gold, etc. You should aim to have access to returns from diversified investments. So that losing in all doesn’t hamper the rest.
How can you Start Investing
To start investing in bitcoin you have to follow some minimalistic steps just like any other investment. Here are some steps listed below for you to start with –
- You have to first look for a good Bitcoin Exchange platform like – eToro, Coinmama, BlockFi, etc.
- On joining you’ll have to search for a Bitcoin Wallet
- You have to then link your Bitcoin Wallet with your Bank Account
- Look for the price of Bitcoin you can purchase without putting in more than $25 primarily
- Handle your Bitcoin Investments strategically
Remember that you’ll always have room for opting out of any investment in the world of digital currency.
To facilitate the process of sharp decision making you should always look for more information and details before purchasing any tangible asset like Bitcoin.
Conclusion
Bitcoin is neither a good nor a bad investment. The experience of using Bitcoins varies from man to man. You should consider investing in Bitcoin only after thorough comprehension of all your goals and actions.
Being a volatile asset, it can have rapid and unpredictable rise and fall. So starting with a smaller amount makes it easier to track the success of your contemporary strategy. Also, your financial stability would not be zapped if struck by misfortune.
Author Bio:
Pooja Shah is a Content Writer at Financesage. It is a blog where I cover financial tips related website which is working towards investors to take better financial decisions and make the best choices while buying financial things and for better financial life.
