Almost every sphere of business, commerce, economy, and even our everyday life is dependent on the Internet. There should be a little surprise for anyone to notice that Bitcoin has claimed the interest of investors globally. Secure, global, and digital; this currency is open for everyone. It is an exciting new asset class; however, investing in Bitcoin demands time and effort.
Why invest here?
Before answering this question, we need to understand that what makes Bitcoins valuable? Gold, for instance, is in limited quantities on earth. Even when gold is mined continuously, there is always less and less gold available for buyers. It gets more expensive for buyers, and so does mining.
The same applies to Bitcoins. The number of Bitcoins is limited to 21 million, and with time and a limited supply rate, it’s bound to get costlier.
There is only 21 million Bitcoin, and as time goes on, they become harder and harder to mine. Take a look at Bitcoin’s inflation rate and supply rate. It has a sound monetary policy, and you can see whenever new Bitcoins are created or even know how many Bitcoins are in circulation.
You can digitally transfer Bitcoins anywhere across the world. Payments here are never blocked, and it is censorship-resistant. It also provides safeguard against failed governments or sunk economies. This currency practically remains isolated from any global recession too.
The Internet made information global and easy to access. A sound, global currency like Bitcoin will have the same impact on finance and the global economy.
If you understand the potential impact of Bitcoin, it won’t be hard to comprehend hard why investing in Bitcoin may be a good idea.
There is no official price of Bitcoins. It’s set by whatever people are willing to pay. An apparent game of demand and supply is applicable here. For further information, a price index can be referred to. Bitcoin price means the cost of a single Bitcoin. Some exchanges let you buy Bitcoin for any amount. You can even buy less than one Bitcoin.
The right time to buy
Like any other investment venue, there are no guarantees here. Throughout its brief history, the value of Bitcoin has increased at an accelerated pace. The downfalls were slow, and market stabilization was fast. There are several tools that one can use to perform analysis and research. This currency never gets affected by an individual country’s economic situation. This currency is global.
It is noticed that the global economic or other chaos generally benefits the Bitcoins in terms of pricing. Apolitical in nature, this digital currency remains free from any influence of a government or trade blocs.
Therefore, investing in Bitcoins requires you to think in a global perspective.
Bitcoin investment: How and Where
Depending on your country, the ease or difficulty of buying Bitcoins will vary. However, developed countries offer more liquidity and options. This digital currency being global can be easily purchased from anywhere in the world.
You can use various exchange finders to find a place where you can buy Bitcoins in your country.
It is an asset, and like anything valuable, there will thieves, hackers, and scammers will be after your Bitcoins. Hence, security is a prime concern here. It would be best if you considered buying Bitcoins wallets. These are specially built with safety in mind, and one should always keep the Bitcoins in these wallets.
You are dealing with a currency that is on the Internet. It means that stealing from any corner of the world is easy. Bitcoins in isolation are secure; however, they are only as reliable as the digital wallet in which you have stored it.
When dealing with Bitcoins, security needs to be your prime priority.
Does investment in Bitcoin Mining make sense?
The Bitcoin mining industry has grown at a rapid pace. Earlier mining was possible to conduct on any computer that we use at home or office. However, today it costs a lot- nearly millions of dollars. Hence, now it is done in specialized data centers only and yes, profitably.
Consider these data centers as warehouses. It’s a warehouse full of computers that are created with the sole purpose of mining Bitcoins. It’s a costly business to conduct. It will cost millions of dollars even to start a profitable mining operation.
It is, therefore, suggested that for new entrants in Bitcoins business, they should avoid Bitcoin mining. Given the level of investment it requires, it can never be a profitable business for anyone.
For learning purposes or any reason else, you can start a small mine and play around with it. However, this home mining business can never turn profitable. You cannot expect to get a satisfactory return from it.