What Does Investing In Bitcoin Hold For The Future? Part- 2
The steps to Bitcoin investment is as given below. All over the world, investors use the same procedure. There are interesting facts when it comes to investing in Bitcoin.
Continuing The Discussion
Continued from the previous post on Bitcoin investment, the following are the steps in investing in Bitcoin through Bitcoin mining.
Step One: Get a Bitcoin Wallet
A wallet to store Bitcoin is the first thing you need to get started. You have options when it comes to choosing a Bitcoin wallet. Whereas for now the Louis Vuitton and Gucci of the cryptocurrency world right now are software and hardware wallets. On the one hand, software wallets are mobile applications connecting with the traditional bank account where the wallets allow quick and easy access to Bitcoin as the drawback is that they put the money in the hands of a third party company.
With trustworthy leading software wallets, the popular third-party companies have collapsed or been hacked in the past. Users with larger Bitcoin holding surely have to consider storing their money more securely as you wouldn’t store thousands of dollars in the mattress.
On the other hand, hardware wallets come to a little more old school generally considered to be more secure because they are kept offline. The two leading hardware wallet manufacturers are Trezor and Ledger using the user’s private key on physical hardware devices similar to flash drive preventing hackers from accessing the user’s private key through an internet connection.
Step Two: Connect a Bank Account
Connecting your wallet to the bank account, debit card or credit card is essential to purchasing Bitcoin and these payment methods perform the same function of exchanging traditional currency for Bitcoin as they each carry their own set of fees.
It takes four to five days for transactions made using a bank account to process on Coinbase that are generally recommended for first-time investors by linking a bank account to the wallet and thereby buying and selling Bitcoin and deposit that money into the accounts directly. if you are dealing with larger sums of money, bank accounts are recommended.
On the other hand debit and credit cards allow buying Bitcoin instantly as the drawback on Coinbase and other popular exchanges is that debit cards can only be used to purchase crypto even then only in smaller amounts. With the bank account when their wallet is connected to a debit card users cannot sell Bitcoin or deposit money.
Step Three: Join a Bitcoin Exchange
While trading Bitcoin for traditional currencies, say BTC for USD, Bitcoin exchanges are online marketplaces just like when you go to make a purchase online with options like eBay, Amazon, Etsy, and Alibaba to say nothing of millions of retailers using the websites to sell products. The case is similar for buying Bitcoin.
Usually, even when two exchanges trade the same cryptocurrencies they offer slightly different services as they vary in reputation, reliability, security, processing fees, exchange rates and cryptocurrencies available for trading. Look around before you settle down with an exchange. Below are some of the top recommendations to start with.
Most of the exchanges offer wallets for users as security is not their primary business where except for Coinbase it is generally not recommended to use an exchange wallet for large or long term cryptocurrency holdings.
Best for Beginners: Coinbase
The most popular and respected digital currency exchange in the United States, Coinbase lets users securely buy and store cryptocurrency in one location charging a 1.49% fee for US transactions from a bank account or Coinbase USD wallet. Using a credit or debit card, the purchases are charged a 3.99%fee. Along with it, Coinbase secures cash balances up to $ 250,000 in the event of theft or breach in online storage.
Best for On the Go: Square Cash
The leader in peer-to-peer money transfers the square cash app is right alongside PayPal’s Venmo. The Square comes from the Cash app making those mobile credit card readers a huge financial technology company including many other services along with one of that trading Bitcoin. The Cash app, unlike most online exchanges, stores the Bitcoin in the Square Cash Account rather than a digital wallet. However, when you are worried about security you can send Bitcoin in the Square Cash Account to another wallet of your choosing. Limiting deposits to $ 10,000 per week, Square does not limit to what you can sell.
Best for Bitcoin on a Budget: Robinhood
Accounted to be a free-free stock brokerage Robinhood is expanded into the Bitcoin and Ethereum markets with market data for another 15 currencies allowing users to trade cryptocurrency without a fee. Robinhood apart from Square stores Bitcoin in the same Robinhood account that is used for stocks as the mobile-first and recently added web version best for people comfortable managing money from the phone or tablet.
Step Four: Place Your Order
Ready to buy Bitcoin for the first time, it is crucial to keep in mind that one Bitcoin costs several thousand dollars, where Bitcoin is divided up to eight decimal points. In this the smallest unit of Bitcoin is known as a satoshi and if the price of Bitcoin skyrockets, it is possible to buy satoshi for a tiny fraction of a cent.
This procedure of Bitcoin investment is used worldwide by the cryptocurrency enthusiasts and blockchain developers are continuously evolving into the realm of crypto tokens.