What Is Bitcoin And How Can You Invest?
A digital payment system without intermediaries or banks that was invented as an open source software and released in 2009 is Bitcoin. The U.S. Treasury has classified Bitcoin as a decentralized virtual currency though many believe that it is better described as a cryptocurrency. It has also been called a digital currency for which encryption techniques are used in order to regulate the generation of units of the currency and authenticate the transfer of funds that are operating independently without any interference from the central bank.
How can you invest in Bitcoin?
American individuals that are interested in investing in Bitcoin’s have the option of purchasing them outright. The method of purchasing Bitcoin’s has been simplified and a number of firms have been established within the US and abroad that are involved in the business of buying and selling Bitcoin’s. Investors in the USA will find a simple solution if they want to make an investment if they decide to contact coinbase. This company is prominent in selling Bitcoin’s at a markup price that is typically 1% over the present market price.
Coinbase has an option for Americans and allows them to link their bank account to their CoinBase wallet which makes future payment transfers easier. The company has also made it easier to purchase Bitcoin’s with the help of automatic Bitcoin purchases at regular intervals as desired by you. For example, if you want to purchase $50 worth of Bitcoin’s on the first and second day of every month immediately as you receive your paycheck you have the option of setting up an automatic purchase option for the amount desired on CoinBase. However, you are required for the following if you decide to set up the automatic purchase option.
You will not have any control over the purchase price of the Bitcoin.
CoinBase is not a Bitcoin exchange and you are purchasing or selling your coins from a firm which again has to source them from other buyers and therefore you must be prepared for delays or certain issues when executing orders particularly when the market is moving fast.
Other methods to purchase Bitcoins
Exchanges are not the only option for you if you are trying to purchase Bitcoin’s. You can also choose to buy Bitcoin’s off-line with websites that are functioning for this purpose. The website establishes contact between potential buyers and sellers. When purchasing Bitcoin’s off-line people are advised to take the general precautions as they would typically do when dealing with a stranger. The meeting should be held during the day in a public place and in the presence of witnesses if possible.
Traders that are interested and want a traditional Bitcoin exchange also have an option available to them in the form of BitStamp. This website only acts as an intermediary and traders will have an opportunity to directly trade with other users and not BitStamp. Traders can find better liquidity on this platform and when their trade exceeds $150,000 in 30 days the fees will be lowered to 0.2%.
Right now Bitcoin is hot and investors, venture capital firms are having a belief that Bitcoin’s are here to stay. The average individual will find a number of ways to get into the investments and purchasing Bitcoin’s. Within the United States, the most popular options for the purchase of Bitcoin’s are CoinBase, BitStamp and local Bitcoin’s. They all have their advantages along with some deficiencies and people that are looking forward to investing money in Bitcoin’s are advised to conduct the research required in order to find the best fit for their requirements.
When people decide to invest in Bitcoin’s they are exchanging their hard-earned money for a virtual currency that is fluctuating every day. If people hedge their bets properly they stand to gain from their investment but things could go in the opposite direction if they make an error of any kind when investing in Bitcoin.
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