Bitcoin investment is open to everyone and offers exciting opportunities to delve into a new asset class. However, bitcoin trading might be challenging for beginners and risky for experienced investors too. Unlike stock trading, bitcoin has no central body, which guides investors.
Well, horror stories, rumors, and hype rule the internet, and it may be hard to separate hearsays from facts. Riding on rumors and hearsays is the main recipe for failure. Therefore, before getting your feet wet, it may be necessary to research, learn the basics, and narrow down to the following tips.
- Learn How to Store
To store your bitcoins, you will need a special program referred to as a wallet. Today, there is a plethora of bitcoin wallets. If you want to securely store your bitcoins, you will need hardware wallets. These wallets are dedicated devices that electronically use private keys. Typical examples of hardware wallets are Ledger USB, KeepKey, and Trezor.
For people who want to sell and buy bitcoin can also use desktop wallets. These wallets can allow you to carry out transactions within the bitcoin network and establish an address you can use to store your coins. They also come with specific features, and some of them like Multibit wallets are designed to work in different operating systems, including Mac, Windows, and Linux. Apart from desktop and hardware wallets, you may also use:
- Mobile wallets
- Paper wallets
- Online wallets
- Consider Diversification
Diversifying is the golden rule when it comes to bitcoin investment. When you invest your money in different kinds of assets, you will reduce the risks. In addition to that, diversification offers you more returns and may help you keep balance between your target and risk. However, diversification may not reduce all the risks, but it may help you manage them. Basically, there are different kinds of investment risks; unsystematic and systematic risks. Unsystematic risks encompass financial and business threats that can easily be diversified. The risks differ from one company to another so you can analyze different things.
On the other hand, systematic risks, also regarded as the market risks, cannot be diversified because they include exchange rates and uncertainties, such as inflation, war, and natural calamity.
- Know Where to Buy
ATMs are an option to buy bitcoins. You can find the exact cryptocurrency ATM locations by using a Coin ATM Radar service. The service can offer you the option of looking for nearby ATMs through the live worldwide Bitcoin ATM map. With the service, you may also get the directions of the automated machine from your location, find ATMs near you, and receive all the equipment’s details, including limits and fees.
Alternatively, you can buy bitcoins from Coinbase. This platform provides a wallet and exchange for clients, making it the simplest place for beginners to start their investments. Though, you may still buy your coins from other platforms like:
- Coinbase Pro
- Square Cash
Bitcoin investment is not that different from trading stocks. However, things might get complicated, but the rule of thumb is to invest the amount of money you can afford to lose. Once you are ready to invest, get the right exchange platform, and remember to use these guidelines to help you.