Building your investment portfolio: How to buy and sell Bitcoin
Launched in 2009 by the anonymous Satoshi Nakamoto, Bitcoin (BTC) is the currency revolution that forever changed the landscape of the global money payment system. From what started with traditional settlements like credit/debit cards and bank transfers, the digital economy now caters to more than 6,000 cryptocurrencies.
The 6,000 digital currencies are not different coins or assets distinctive from one another. Some of which were derived from the original through an initiative called a fork and, of course, Bitcoin is not exempted from this case. It has had quite a number of variants, especially in 2017, such as Bitcoin Cash, Bitcoin Gold, and Bitcoin Diamond, among others.
Regardless of Bitcoin forks modifications, the worlds’ first peer-to-peer (P2P) decentralised crypto remains the most valuable digital currency in terms of both market cap and coin value. It was, after all, the one who paved the way for the industry, so it will always be three to five steps ahead of the rest. So, if you are among the many populations that want to have a share of its thriving market to add to your investment portfolio, here’s Bitcasino to teach you how to buy and sell BTC.
Why BTC remains a good investment option
Extreme market volatility and global political limbo are two of the biggest drawbacks of Bitcoin, and perhaps to the rest of digital currencies. However, these don’t stop tens of millions of users from buying, selling, and using its features due to the following advantages:
- Accessibility — Digital currencies are decentralised networks based on blockchain technology not issued by any national government. Meaning, wherever you are in the world and whatever your citizenship may be, you can use Bitcoin anytime because it can’t be restricted by geographical borders.
- Liquidity — Liquidity is essential for any tradable asset, and Bitcoin’s large market cap and valuable coin price enjoys high liquidity.
- Short and long-term store of value — Bitcoin’s limited quantity, which is controlled by mathematical algorithms, makes it impossible for national authorities to devalue it during inflation.
- Safety and security — One of the many outstanding reasons why Bitcoin is the benchmark for the crypto trade is its powerful peer-to-peer payment mechanism. Since BTC, like the rest of digital currencies, exists on a blockchain, all transactions are safely protected from fraudsters due to the cryptographic puzzle known as ‘proof of work.’
5 essentials you need before buying and selling BTC
Privacy and security are important qualities for any crypto investor, thus needing the following essential things first before you can buy, sell, and/or make BTC transactions.
- Personal ID documents to verify your identity in making crypto wallet and exchange accounts.
- Secure connection to the internet
- Crypto wallet
- Crypto exchange
- Methods of payment
4 steps of buying and selling Bitcoin
The steps to purchase BTC are outlined below. Keep in mind that you must still conduct your research and choose the best option depending on your specific conditions.
#1: Find a crypto trading service or exchange
Choosing a crypto trading provider or venue is the first step in purchasing BTC. Crypto exchanges, payment services, and brokerages are all popular examples for this category. In comparison to other options, the former is the most convenient alternative because it offers a wider range of services and more digital coins and fiat currencies for trade.
There are many types of crypto exchanges, with centralised (CEX), decentralised (DEX), and hybrids as the most notable examples. Depending on your selected services, each has considerable benefits and drawbacks.
#2: Connect your crypto exchange to a payment option
You will need to assemble your personal documents once you have decided on an exchange. These may include images of your driver’s license or Social Security number, as well as details about your employment and source of finances, depending on the exchange. The information you will submit is likely based on the place you live in and the regulations that govern it. In other words, the procedure is similar to that of opening a traditional brokerage account.
You will be prompted to connect a payment option when the exchange has verified your account. Most exchanges allow you to connect your bank account or a debit/credit card directly. Although you may buy BTC using a credit card, this is not a smart idea since crypto price fluctuation might raise the entire cost of buying a coin.
#3: Place your BTC order
After selecting an exchange and linking a payment method, you may purchase bitcoin (or other digital currencies). Crypto exchanges have gradually grown more widespread in recent years. In terms of liquidity and feature set, they sure have greatly expanded.
The reason for this is that today’s crypto exchanges have essentially identical qualities to their stock brokerage equivalents. They now have a variety of order kinds and investment options. Almost all of them let you place market and limit orders, and some even allow you to place stop-loss orders.
#4: Store your digital assets safely and securely
Wallets for BTC (and other digital currencies) offer a secure way to store digital assets. Keeping them in your personal wallet account rather than being on an exchange means that only you have access to the private key to your funds. Likewise, it also allows you to keep them outside of an exchange, thus reducing the chance of them being stolen if your exchange is hacked.
You have a number of options when it comes to selecting a Bitcoin wallet. However, the concept of hot wallets (online wallets) and cold wallets is the first thing you should learn about crypto wallets.
Since they are connected to the internet, hot wallets are simple and convenient. As a result, they are ideal for everyday use and basic transactions (i.e. playing crypto games at Bitcasino). However, because of their internet-connection feature, you are subject to digital risks such as technical issues and mischief.
Cold wallets are portable devices that only connect to the internet when they are used to conduct transactions. Their safe offline storage function makes them excellent for company owners, long-term crypto traders, or hodlers (people who ‘hold on for dear life,’ as the industry calls them).