Bitcoin’s unbelievable journey post the pandemic-induced lockdowns is no secret to anyone. Prices of this crypto asset have skyrocketed beyond belief and people are looking for different ways to invest in the Bitcoin. At the same time, which is the best way to invest Bitcoins is a question uppermost in the minds of crypto investors. The truth is Bitcoin’s prices are highly volatile; the currency is not issued nor backed by any government or financial institution. All these factors create an aura of mystery and intrigue surrounding the Bitcoin.
What are the Different Ways in Which you can Invest in the Bitcoin?
- To start with, you can consider buying Bitcoins through apps like Coinbase; you may buy an entire Bitcoin or even a fraction of it, depending on your budget. You will need to register on the sites and provide personal details for verification. Once your account is verified, you can then deposit money for buying Bitcoins. When you buy Bitcoins, your assets will be stored securely in a wallet and you will be provided with private keys to access this wallet.
- Those looking to invest via capital markets may access GBTC or Grayscale Bitcoin Investment Trust; this has many advantages making Bitcoin investments a digestible option. You can hold GBTC shares in specific IRA and brokerage accounts. Through robust offline storage systems, GBTC lets investors that are less tech-savvy to access Bitcoin markets safely.
- Some investors opt for mining to invest in Bitcoins. Mining refers to the process of solving complex mathematical problems using specialized mining hardware. Every time a block is mined successfully, miners get rewarded in Bitcoins. Earlier, mining was done using regular personal computers but today, you need sophistical equipment for mining. When you join a mining pool, you can solve complex cryptographs with other miners in the pool and share the total payout.
- Another option for investing Bitcoins is through trading the Bitcoin. You can create an account on online trading platforms or crypto exchanges and start trading. For example, sites like Kraken, Coinmama, and Coinbase allow you to buy or sell cryptos in exchange for fiat currency or other crypto coins. The trick is to start with small amounts to test the waters and then move onto bigger trades.
- You can even consider buying Bitcoins face-to-face; however, you must ensure that the person you interact with is someone trustworthy and credible. Sites like LocalBitcoins will bring you into contact with interested sellers and buyers and each user has a score indicating his reputation and credibility. This helps you make the right choice of a buyer or seller. This transaction is faster obviously than transactions through exchanges.
- You can also go to Bitcoin ATMs to buy Bitcoins; these machines may charge transaction fees of 3%-5%. Usually, people keen to buy Bitcoins insert cash to get their share; some have also used ATMs for selling the cryptos to get cash.
- Finally, you can always invest in companies that hold Bitcoins and other cryptos. There are quite a few publicly-traded businesses which have created system to accept payments in cryptos or using blockchain technology. Companies like Tesla have recently invested in the Bitcoin and has shown interest in accepting crypto payments.