Over the last few years, cryptocurrency Bitcoin has become incredibly popular. Back in 2009, when the digital money first hit the internet, it was accepted by basically no one – especially not real-world vendors – and was worth as little as $0.049. Now, huge companies including Microsoft, Shopify and Gap are all happy to exchange their goods and services for Bitcoin, which has, in turn, caused the price of Bitcoins to explode. As of writing this, a single Bitcoin is worth almost $8,000, though the price did almost reach $20,000 back in December 2017.
Unsurprisingly, this has encouraged numerous people to look into cryptocurrencies and investigate how they too can invest. As Bitcoin’s price is currently on a steady decline (from the incredible high of last year that is), it is the perfect time to start looking into how you yourself can buy Bitcoin. That is if the price falls within your budget. Today, we thought we’d look into how you can buy Bitcoin and tell you everything you need to know.
Sign Up For A Bitcoin Wallet
Before you purchase any Bitcoin, it is absolutely crucial to download a Bitcoin wallet. There are plenty of Bitcoin wallets to choose from so it is best to do your research to see which one will suit you best. There’s downloadable software that can serve as a digital wallet or you can download an app for your iPhone or Android. Once you’ve chosen the wallet for you and have set it up, you’ll be all good to go.
However, do remember that a Bitcoin wallet is more of a private key than somewhere your Bitcoins are actually stored. All Bitcoin balances are secured with public and private keys, lengthy codes linked to the mathematical encryption algorithm that brings Bitcoins into existence. Public keys are comparable to bank account numbers; they enable you and others you are exchanging Bitcoins with to locate your cryptocurrency. The private key is similar to an ATM pin, used to authorise transactions. These are both stored within a Bitcoin wallet and you must protect your wallet with strong passwords to ensure no one else can enter it.
Exchange Your Traditional Cash For Cryptocurrency
When setting up your wallet, in addition to security-related procedures, you will be asked to provide a payment method. Usually, your options include debit cards, credit cards and bank transfers, as these will allow you to exchange your traditional cash for cryptocurrency. Of course, these options may change depending upon the type of wallet you’ve acquired as well as your area of jurisdiction.
Another option is online payment service PayPal, which makes sense considering the fact that PayPal is incredibly secure and internet-centric just like Bitcoin. However, according to CoinList, it is best to buy Bitcoin with Paypal through Contract of Difference (CFD) providers such as eToro, AVA Trade or Coinbase, as this ensures your money is significantly safer during the exchange.
While it may take a little while to get your head around how Bitcoin is purchased and exchanged, it really isn’t that different to traditional cash. Really, the only difference is there are no physical counterparts for Bitcoin, which can be daunting. Still, there’s no arguing that investing in Bitcoin can be lucrative, so we hope we’ve helped you on your way to getting involved in cryptocurrencies.