Bitcoin has become a formidable force to reckon with ever since 2017 when its value skyrocketed to a whopping $20,000 per coin. While the initial euphoria seems to have subsided after that record-high value, optimists are confident that Bitcoin will continue to be in huge demand in the future too. Bitcoin is essentially a digital currency that one can now use for making online purchases, and also for investment purposes, albeit a slightly risky option. You must realize that Bitcoin prices will fluctuate from time to time, and one must not invest more than he is prepared to let go. While you have experts insisting that the value will touch $1 million and more, critics like JP Morgan Chase and Warren Buffet feel that the system is flawed and set to collapse.
How to buy the Bitcoin in 2020:
When you wish to buy the Bitcoin, you need a place for storing it; this could be an online wallet or a physical device that can be plugged onto a computer. But when you do transactions in the Bitcoin, you have to remember that transfer fees can be steep. There are basically three ways in which you can now buy the Bitcoin, namely, through an online exchange and store the currency in digital wallets, buy Bitcoin CFD or Contract for Difference, and buy market security linked to Bitcoin.
- When you buy underlying Bitcoin you are the asset’s direct holder and the cryptocurrency will be sent to your exchange account. You can then transfer the Bitcoin to a wallet address or Bitcoin address using the private key which will verify your ownership of this asset. The greatest advantage of this method of buying the Bitcoin is that you are in control of the digital asset. It is also a versatile option allowing you to transfer, sell, convert or exchange the cryptocurrency. There are no risks of third-party accessing the fund since you are provided with private keys. You will also get multiple wallet options for transferring the asset. This method is best suited for investors looking at long-term investments and keen to actively protect their Bitcoins. The trade can also be done through automated applications like bitcoin era app efficiently like a pro.
- CFD trading will let you make profits because of price changes in the underlying assets when you do not actually own these. So, you basically use your own judgment for deciding whether prices will fall or rise; in short, you can make profits from falling and rising prices. In this method of buying the Bitcoin you do not have to safeguard private keys. CFD derivatives allows shorting by letting you open a selling position before a buying position, benefitting those keen to speculate on fall in prices of assets.
- Finally, you can buy Bitcoin-related market securities like the GBTC or Grayscale Bitcoin Trust. This is backed by a leading venture capitalist firm specializing in the Bitcoin. When you have a Bitcoin-related security trying to replicate the asset’s performance or acting as a trust holding Bitcoins where the investors need not have private keys, traders can enjoy an alternative investment option for buying and holding the Bitcoin. Using listed securities which can invest, hold, or track the Bitcoin may be a good alternative for diversifying risks. But events like the hard fork may create problems for Bitcoin-related securities like the GBTC.