Is It Time for You to Invest in Bitcoin?
How much do you know about Bitcoin? According to experts, the value of this unique currency has raised by around 2,564% since 2011, which means that it’s definitely worth the interest it’s been getting online. If you were an early adopter of bitcoin, then the chances are you’re already reaping the rewards of your investment. However, if you’re just coming into the Bitcoin craze now, you might be wondering whether it’s worth your time, and your money.
The Bitcoin is by far one of the most remarkable currencies on the market today. In began the year of 2017 priced at around $3600, and by the time we hit the 12th of October, it had already risen in value by around 50%! In January 2011, you could buy a Bitcoin for 25 cents, but if you were selling that same coin today, you could be earning over 2000% more!
#Bitcoin $3000 to $4000 pumped in less than 72 hours! (as long as it goes up a dollar more in the next 2 hours 12 minutes 🙂
— Richard Heart (@RichardHeartWin) September 18, 2017
It’s no wonder that many investors have begun to take notice of this incredible currency. However, before you consider investing in digital money, you need to make sure that you understand exactly what it is, and how it works.
What are Bitcoins Anyway?
Bitcoins are a form of digital currency that was originally created by a group of developers and hackers. Though the identity of these people remains largely unknown, the popularity of Bitcoin has skyrocketed over the years. The coins are designed by computers that solve countless complex problems over the years, to record transactions and make coins. Users trade the coins on exchanges such as “Coinbase”, and all the trades are recorded on a public ledger known as the blockchain.
Although you might think of Bitcoin as an infinite resource because it’s digital, the truth is that there are only around 15 million coins in circulation, and 21 million in total. The supporters of the Bitcoin movement think that this limited supply ensures the rise of Bitcoin’s value over time, and some people believe that the price could eventually hit around $10,000 per coin.
Of course, there are no guarantees when it comes to any investment, including Bitcoin. Fans currently believe that Bitcoin is one of the most secure investments any person can make – more stable in fact than the government-backed flat currencies that can easily be devalued when banks print more money.
According to professionals in the industry like Obi Nwosu, the managing director of Coinfloor, investors consider Bitcoin to be the most ideal form of money created, because it’s durable, scares, and divisible. This means that more people will come to use it over other alternatives.
Making the Case for Bitcoin Investment
Currently, Bitcoin has two practical uses that can be ideal for people who purchase this investment solution. The first option, is to use your Bitcoins as a form of online payment which is often faster, and more secure than a standard money transfer service. As the popularity of this currency has grown, more businesses have begun to accept bitcoin from their customers. Now, Tesla motors, Virgin Galactic, Dell, and more all accept Bitcoin as a form of payment. In 2014, Dubai even opened their very first Bitcoin ATM.
The other way to use Bitcoin is as a form of long-term investment, which can be bought and held in the hope that the value will increase drastically with time. Already, early adopters of the Bitcoin model have been rewarded, but it’s hard to plan ahead for the future in any investment area, and you’ll need to make sure that you brace yourself for volatility before you invest.
In 2013, the price for Bitcoin peaked at over $1,000, before quickly trailing downwards to a rate as low as $225, which seriously harmed people who purchased their investments when the coins as at the top of the market. Of course, Bitcoin values have also recovered again since then, but hacking scandals and other concerns mean that the market remains volatile. For instance, not so long ago, about 120,000 Bitcoins, valued at $78 million were stolen from Bitfinex in Hong Kong – one of the world’s biggest exchanges for cryptocurrency.
When the news about thee scandal broke out, the value of Bitcoin fell by 20% as investors began to panic. It’s important to think of Bitcoin not as a single solution for your investment portfolio, but perhaps as one solution for keeping your investment solution diverse. There are some extremely good returns to get from Bitcoin, and the substance outperforms all of the other world currencies in most cases.
Of course, investing in bitcoin might not be for the faint-hearted. You’re going to have to expect some huge swings in value, which means that buyers can’t treat their Bitcoin solutions as a kind of get-rich scheme. Instead, you’re going to need to make sure that you’re aware of the risks. While you could triple your money in a matter of years, you could also just as easily lose it all.
According to the digital agency “Head”, which gives businesses guidance on technology, the lack of regulation in Bitcoin might be appealing to some, but it also means that the currency has none of the stability that’s typically associated with money. Additionally, Bitcoin is a kind of anonymous solution for people who want to make large money transfers over borders, so it has become linked to illegal services and goods. The first people to hear of the currency were using it on the black-market site “Silk Road”.
How To Buy Bitcoin?
You can buy Bitcoins in UAE via online platforms and exchanges, with an increasing range of UAE options becoming available, such as BitOasis which allows you to purchase your coins through a bank transfer. You can also purchase “fractions” of a bitcoin instead of buying the whole thing if you don’t have a lot of money to manage.
Globally, there are dozens of brokers and bitcoin exchanges to choose from, including Coinhouse, Coinfloor, CoinCorner, and countless others. Transaction fees for your purchases will vary according to the broker or exchange, but typically they range from 0.2, to 1% of the currency purchased, along with the bank transaction fees.
Once you’ve purchased your Bitcoins, they can be stored in an online vault or wallet, which exits within the cloud. This can also link back to your bank account. Make sure that you trust the provider you buy from, as if hackers breach the security measures on the website, your Bitcoin might be stolen.
In most cases, you will be able to pay for your investments by mobile payments, bank transfers, or standard MasterCard and Visa payments. According to the founder of the broker exchange BitOasis, you can also sign up to the local platform on the website and buy vouchers that can then be exchanged for digital currency.
Keep in mind that although the network you purchase your bitcoin from may be secure, the exchanges where you choose to hold your coins can often be vulnerable, so you’ll need to make sure that you find something with strong security measures.
The Skeptical Side of Bitcoin
Of course, not everyone feels as though Bitcoin is definitely going to be the next big thing. According to the Swift Institute, it’s unlikely that this currency will crowd out standard flat currencies such as the US dollar. Instead, most people assume that the Bitcoin will be used as an investment vehicle, rather than a mode of exchange.
At the same time, there’s no correlation between traditional classes of assets like bonds and stocks, and Bitcoins to look at when it comes to making investment choices. There’s always a chance that Bitcoin could be superseded at a later stage, as new technology continues to emerge. When that happens, there’s a chance that Bitcoin’s value could drop dramatically within a matter of minutes or hours.
The controversy surrounding Bitcoin is unlikely to go away any time soon. Just as much as some people think that it’s a strange and unnecessary form of investment, others believe that Bitcoin could be the ultimate investment solution for those seeking versatility and incredible growth. If you can learn how to use Bitcoin to your advantage, then it’s hard to argue with the results that some investors have been able to achieve.
Just remember, as with any kind of investment, it’s important not to put all of your eggs into one basket. Bitcoin is still a risk.
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