New to Bitcoin?
You may have heard many people “rumor” that investing in Bitcoin is very profitable! So, how true is that?
Let’s discover what Bitcoin investment entails with BTAguru and learn how to trade Bitcoin!
What is Bitcoin Investment?
Just like when you invest in gold or real estate, you buy these assets with the hope that their prices will rise over the next few years, allowing you to sell them at a profit.
Bitcoin works the same way!
Bitcoin investing involves using your money to buy Bitcoin with the expectation that its price will increase, allowing you to sell it at a higher price than what you purchased.
It’s easy to understand, right?
Is it safe to invest in Bitcoin?
When mentioning the word “investment,” you may feel anxious because you fear “losing money,” correct?
I also want to emphasize that investing in Bitcoin carries risks rather than guarantees.
This is due to the fact that the technology behind Bitcoin is still relatively new, and Bitcoin itself continues to evolve and mature over time. What the future holds for Bitcoin remains uncertain, or whether alternative cryptocurrencies will emerge.
Therefore, investing funds that would not significantly impact your life if lost is advisable.
Risks of investing in Bitcoin
You’ve probably heard the saying “No risk, no rewards” somewhere. If you haven’t, you can understand that there will be no reward without risk.
The greater the reward, the higher the risk.
When investing in or trading Bitcoin, it can bring you huge profits. However, despite the high profits potential, the risk is also extremely high.
Here at BTAguru, we will present you with some risks that you need to be aware of before investing:
- Price volatility: Bitcoin has a large range of price fluctuations. It can fluctuate by a few percent in a day, but sometimes it goes up to 20-30%.
- Security: While Bitcoin has never been hacked and is difficult to hack, we don’t know what could happen in the future.
- User: This error is caused by the user’s carelessness. It could be forgetting or leaving behind secret keys to access a wallet or transferring funds to the wrong address.
- Exchanges: Many people buy Bitcoin through exchanges and leave it on the exchange. Some exchanges may collapse, and you could lose your money.
Should Bitcoin still be invested in 2023?
2021
In 2021: We have just entered the first months of 2021, and the price of Bitcoin kept breaking records, reaching nearly $42,000. The reason partly lies in the Bitcoin Halving event in 2020, where the mining reward was halved. According to historical data, the price of Bitcoin has typically grown dramatically after this event.
Not only that, but Bitcoin is also becoming more widely accepted as an investment asset class. Many large companies have entered the market, such as MicroStrategy, Square, and PayPal… For example, MicroStrategy bought over 70k BTC worth over $1.8 billion in December 2020. This trend is likely to continue in 2021.
The macroeconomic situation has many uncertainties, such as governments constantly launching economic stimulus packages, excessive money printing, and near-zero interest rates. Bitcoin is seen as a haven for investors. Since a central bank does not issue Bitcoin and is not regulated by any government entity, its value is less affected by economic fluctuations. Many investors predict that the price of Bitcoin can reach $50k, $100k, or even $200k.
2022
In late 2021 and early 2022, Bitcoin peaked at $69,000.
After a strong injection of money in 2021, investment channels all skyrocketed. In 2022, the US Federal Reserve (Fed) began raising interest rates.
The monetary tightening cycle is taking place globally to control inflation.
Most investment channels fell and stood still. Bitcoin’s bottom was set at $17,622 on June 18, 2022.
This is a big drop for Bitcoin and the crypto market in general.
In “danger,” there is “muscle.”
This can be a good opportunity for investors to learn and enter the market.
However, Bitcoin is a venture capital channel, many people have got rich thanks to Bitcoin, and many also lose a lot.
So if you intend to invest in Bitcoin, you should research carefully and make a decision!
2023
Bitcoin is the largest cryptocurrency in the world, with a market share of over 40% of the total value of the crypto market. From the beginning of 2023 to now, the price of Bitcoin has increased by more than 76% and reached the highest level in history of 30,275 USD on June 26, 2023, according to data from CoinDesk. The reasons and events that caused Bitcoin to grow from nearly 17k$ to over 30k$ as of now from the beginning of the year to the present time of 2023 include:
The recovery of investor confidence in cryptocurrencies after a difficult in 2022 was reflected by the increase of call options over put options and the decrease of Bitcoin leaving whale wallets, according to Deribit and CryptoQuant.
In the favorable macroeconomic context, interest rates may decrease when inflation decreases and the USD weakens, creating demand for risk-sensitive assets such as stocks and cryptocurrencies, according to CoinShares and Barron’s.
The shift of supply when the remaining amount of Bitcoin is decreasing and the halving event will take place in 2024, which reduces inflation and increases the value of Bitcoin, according to Bitcoin’s design.
However, Bitcoin is not a perfect asset and has no risks. Bitcoin still faces challenges such as high price volatility, lack of legal regulation, lack of trading and security infrastructure, competition from other cryptocurrencies, and new types of digital assets. Therefore, investors need to deeply understand Bitcoin and the cryptocurrency market before deciding to invest in this type of asset.
How much money does it take to invest in Bitcoin?
When I first heard that the price of 1 Bitcoin is about $30k at the time of writing, I thought investing in Bitcoin would require at least tens or hundreds of millions. However, you only need $30 to buy 0.001 BTC. So with $30, you can also invest in Bitcoin. This amount is not much, but I recommend starting with an initial investment of $30-$100 to get used to it first.
How much money does it take to invest in Bitcoin?
How to Invest in Bitcoin for Beginners
1. Learn about Bitcoin
If you didn’t already know, Warren Buffett wouldn’t invest in something he doesn’t understand. So you should also understand exactly what Bitcoin is before investing, right?
If you already understand, skip this step. Here is a detailed article for you to find out in detail.
What is Bitcoin? [The most comprehensive information about BTC]
2. Create a Bitcoin Wallet
Bitcoin wallets are where you can store them and use them to transfer and receive them. So understanding and choosing a wallet is essential.
What is a Bitcoin Wallet? Top 9 Reputable, Secure, and Best Wallets
3. Buy Bitcoin and how to buy it
If you want to invest in Bitcoin, you know you have to buy Bitcoin, right? If you are still promiscuous, see where to buy Bitcoin!
4. Reputable Exchanges
When investing in Bitcoin, to optimize portfolio diversification or increase the number of Bitcoins, you must trade on major Bitcoin exchanges to buy and sell Bitcoin, Altcoins.
Some famous floors such as:
- Binance Exchange
- Huobi Exchange
- KuCoin Exchange
BTAguru encourages you to choose Binance. As it is the largest exchange in the world right now and its ecosystem is rich, there are many services for you to choose from.
After choosing a reputable Bitcoin exchange, you can access its spot feature to buy Bitcoin quickly. This feature allows you to search and select the BTC USDT trading pair. BTC USDT is the trading pair with the largest volume and extremely good liquidity. After choosing, review the Bitcoin, USDT price to convert the USDT amount for BTC you desire.
4 Tips for Investing in Bitcoin
1. New investors should trade small amounts
Bitcoin transactions are unlike any other form of online payment transaction. For example, when you transfer money online via Vietcombank’s Internet banking.
If you send the wrong account number to someone else, you need to ask Vietcombank to cancel the transaction, and you’re done.
But not so with Bitcoin; if you mistakenly send it to someone else’s Bitcoin wallet address, it is considered that it cannot be recovered.
So when you start investing in Bitcoin, you should trade small amounts as if you get used to it first. When you are proficient and understand the process of every transaction, you will trade in large quantities.
Moreover, investing always has risks attached. Therefore, you should not use large quantities to avoid affecting daily life.
2. Always keep your account and wallet safe
Some of his experiences so that you can be safe:
- Avoid fake websites that impersonate the platform you trade. Before trading, please check the website address.
- Do not give account information, or the private key to strangers.
- Don’t access links that you don’t know what it is
- Not believing the winner, the giveaway asks you to send them Bitcoin, and they return it.
- Store offline recovery keys or characters to avoid hacking.
3. Do not store Bitcoin for too long on the exchange
In addition to how to store Bitcoin via Bitcoin wallets, quite a few people choose to store it directly on a cryptocurrency exchange.
Usually, each exchange will allow us to create 1 separate Bitcoin wallet address to store directly on the exchange; each coin will provide 1 wallet for that coin.
This method is only suitable when you trade coins or surf on that exchange, and for long-term investment, you should use the wallet I mentioned above.
Since cryptocurrency exchanges, large or small, are almost always “stalked” by hackers to steal customer coins or the exchange crashes, you will lose all the Bitcoin you store.
The most recent example of hackers is the Japanese exchange MtGox, in which hackers stole more than 750,000 BTC, or about $1.5 billion at the current Bitcoin exchange rate, in 2014.
Just last month, the Bitcoin exchange Btc-e.com a large, reputable, and long-standing exchange, was involved in a money laundering case that led to the exchange owner being arrested by the FBI, leading to the exchange shutting down.
So far, many Bitcoin investors still don’t know where their Bitcoins are going.
4. Stay Updated with Bitcoin News
News is an extremely important factor in the cryptocurrency market. It directly affects the price of any cryptocurrency, and Bitcoin is no exception.
Therefore, you should regularly monitor and update Bitcoin-related news to understand the market situation and make the right decision to take profits at the right time.
Btaguru.com is a Bitcoin news channel you can follow, or you can keep up to date with major foreign blogs about cryptocurrencies, such as https://news.bitcoin.com/, https://cointelegraph.com/, or https://www.coindesk.com/.
Final verdicts
Bitcoin investment, in particular, and the cryptocurrency market in general, is opening up earning opportunities for anyone who knows how to seize the opportunity.
Bitcoin or Altcoins are both profitable investments in the future instead of Gold or USD.
This market has undergone many turbulences, and there have been many knowledgeable people.
However, BTGguru still has to note once again to invest in Bitcoin smartly and strategically, do not apply “gambling blood” to this market. Otherwise, you will regret it.
Of course, as I said, investing or trading Bitcoin is always risky. Before entering the virtual currency market, you should consider carefully and invest money “within the means” that can be paid without affecting your family’s finances.
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