Bitcoin lets you exchange and unconventionally transfer money and has been at it since its invention in 2009. However, before you get started, you must be informed on the basics and treat bitcoin like you would your usual funds or investments.
If you’re thinking of buying bitcoin for the first time, here are a few things you should know before getting started:
1. Bitcoin is a Decentralized Currency
Bitcoin being a decentralized currency means no government, central bank, or any third party controls its supply. This means you are fully responsible for your funds, which also makes it retain its worth, as it can’t be devalued since no single institution can claim it. This is also one of the reasons why many people prefer to use bitcoin, as transactions are easier when you have full control over your funds and how you use them. You can complete a transaction within seconds and you can also keep your records anonymous, which means no payment can be traced back to you unless you reveal your identity.
The downside of this however is that if you get scammed or make the wrong transaction, it can never be reversed. This is why you must be careful when dealing with this currency and ensure your funds are secure as much as possible.
2. Secure Your Wallet
Your wallet is the first thing you must have before you can invest in or trade bitcoin. However, it doesn’t just stop at owning a wallet but rather ensuring that it is secure. There are various platforms and exchanges such as the bitcoin up software that enables you to trade bitcoins without hassle. But you also have to be careful and ensure the wallet is highly secure. This includes checking for encryptions, two-factor authentication, frequent backups, and protected passwords, among other important things to ensure you have a smooth experience.
3. The Price is Volatile
The price of bitcoin has constantly fluctuated over the years; it is unpredictable as it rises and falls in price. This is often due to the limited supply when there’s an increase in demand and other factors such as its young economy, novel nature, and illiquid markets. Bitcoin investors over the years know how dramatic the price change can be and how it can change drastically in only a few hours. This volatility in the price of bitcoin is why you can either lose or gain hundreds or thousands of dollars in a day. Like every other form of investment, it is often advised not to invest what you can’t afford to lose with bitcoin.
Bitcoin is a popular digital currency and based on its track record, it seems it will be here for a long time. If you are planning to get started on trading or investing in bitcoin, these are three simple tips you must be familiar with. Bitcoin has its pros and cons and like e