Things to Keep in Mind When Buying Bitcoin

Bitcoin has revolutionised the world’s financial system. No longer are people bound by government-issued currency. Banks, physical cash, and commodities aren’t necessary anymore.

Instead, people can control their financial future, make payments, and make investments online with digital money, with Bitcoin. Bitcoin is a decentralised digital currency, which isn’t governed by a central bank.

Countries throughout the world are considering making Bitcoin legal tender. El Salvador was the first country to adopt Bitcoin as legal tender, but we can confidently say that it won’t be the last.

In this article, we will explain a few things that you need to keep in mind when you’re buying Bitcoin:

Bitcoin Price

The price of Bitcoin fluctuates. It could be tens of thousands of dollars today, and hundreds tomorrow. It’s very unpredictable, which is something that you need to take into consideration before you buy any.

The price of Bitcoin is estimated by the amount of money that people are willing to pay for it. When you’re thinking about buying Bitcoin, check its current price.

You should also do your research and find out what the market conditions are, and if there are any external factors that could cause its price to fall in the days or weeks following your purchase. Try to buy Bitcoin at a price that’s affordable for you.

Method of Purchase

There are many different ways that you can purchase Bitcoin, though the most popular is through online brokerages, direct with debit cards.

If you choose to buy Bitcoin with credit card or debit card transfers, make sure you’re confident that the brokerage is legit and isn’t fraudulent. Unfortunately, as we will come to later, the Bitcoin industry can be very shady.

You can also buy another cryptocurrency and convert it to Bitcoin, which is also very popular.

Creating a Wallet

Before you buy Bitcoin, you need to have somewhere to store it. Even though your Bitcoin won’t be delivered to you as a physical coin and you can’t store it in your bank account, you do need to put it somewhere.

Bitcoins are stored in wallets. You can use a hardware wallet or a paper wallet, the latter of which being the best option. You should avoid storing your Bitcoins in online wallets because they’re vulnerable to theft. There is an entire industry dedicated to stealing peoples’ Bitcoins, so make sure that you exercise caution with yours.

Buying At the Right Time

Buying Bitcoin

As we mentioned earlier, you need to do your research and make sure that you buy your Bitcoin at the right time. But when is the right time? Truthfully, it’s impossible to predict when you should buy Bitcoin.

However, if you take the time to analyse price charts and research price history, you should be able to make somewhat effective decisions.

One thing to consider is global economics because this often influences Bitcoin’s behaviour. You can also browse forums and chat rooms dedicated to cryptocurrencies, where you should be able to find useful information.

Choosing the Right Brokerage

As we mentioned in a previous chapter, you need to select your brokerage carefully. The process of finding the right brokerage can be very difficult.

Whether you’re using your credit card or exchanging another cryptocurrency for Bitcoin, you need to research and find the best brokerage for you.

There are thousands of online brokerages, but not all of them can be trusted. You also need to make sure that the fees you pay for buying and selling Bitcoin are minimal.

Some brokerages charge extremely high fees that can eat away at your profits. You can also buy Bitcoins privately, although that’s not recommended unless you know the trader very well.

Cancelling Your Orders

Once you’ve bought Bitcoins, your order can’t be cancelled. This is something that you need to be aware of whenever you’re purchasing Bitcoin.

Unfortunately, if you make a purchase and then the price of Bitcoin immediately plummets, you have to live with your decision. This is why you need to perform your research carefully beforehand, so as to limit your loss if the worst was to happen.

 It’s also why you need to be very careful about who you buy or sell your Bitcoin to. Once a transaction is made, it’s final. There is nobody to call, nobody to ask for help, and nowhere to cancel your order.

Security

When you’re buying any cryptocurrency online, you need to make sure that you exercise caution and implement security measures.

As we mentioned earlier, there are sophisticated fraud gangs that exist solely to steal peoples’ cryptocurrencies. If you don’t insulate yourself against these gangs, you can lose a lot of money. If you’re using an online wallet, make sure you use multiple passwords and two-factor authentication.

You should also do your best to protect yourself from mobile phishing because this is the main way that thieves are able to steal peoples’ cryptocurrency. Make sure you use a secured browser and use a VPN when necessary.

FOMO

FOMO or fear of missing out is one of the main reasons that people lose money when they’re trading cryptocurrencies.

If you see Bitcoin’s price rising exponentially, don’t rush into it. It could be caused by market manipulation and artificial price rising, which means it will probably plummet when enough people have bought into it.

Whenever you’re buying any cryptocurrencies, avoid rushing in. Do your research, understand why the coin is increasing in price, and develop a strategy geared toward buying in at the right time and profiting from the rise in price.

Alternative Cryptocurrencies

Bitcoin is definitely the strongest cryptocurrency there is, but there are other cryptocurrencies. If you’re interested in investing in crypto, then you should research everything there is.

Bitcoin is undoubtedly the best currency to hold, and at the moment it appears to be going from strength to strength.

Even so, you can also profit from other cryptocurrencies, such as XRP and Ethereum. Try to avoid cryptocurrencies that serve no discernible purpose, because they’re often ‘pump ‘n’ dump’ scams.

When you’re buying Bitcoins, you need to be very careful. Make sure that you take every single tip in this article into consideration, so that you can benefit from Bitcoin and make gains, not losses.