Bitcoin Tutorial for New Investors: People have gained a huge profit from bitcoin and it is always in the news. But, before you invest in bitcoin, you need to know the latest movements of cryptocurrencies. For example, the price of bitcoin has increased more than 763% in the last year. It is based on a decentralized network known as P2P. If you look back then you can find some trending news related to bitcoin.
Elon Musk announced that his company is going to accept bitcoin as a valid payment mode and SpaceX invested more than $1.5 billion in bitcoin. Apart from that, fintech companies like PayPal and Square have enabled crypto on their apps and launched Bitcoin as their IPO in 2021. If you’re interested in learning more about bitcoin trading, click here.
So, it is high time to invest in crypto. Before you take any step, you need to know some basics about bitcoin and other cryptocurrencies. Here, you can find such details:
Do you know about bitcoin? Bitcoin is indeed a decentralized currency that, does not have any physical form, but you need to know more about bitcoin and the blockchain network before you invest as a new investor. Bitcoin is a virtual asset or token, and you can spend your coins to buy goods and services. Like fiat currencies, you can also store your coins in a crypto wallet, and you can find different types of wallets like hot wallets, cold wallets, paper wallets, etc. Bitcoin is capped within a limited amount, and people cannot mine this coin randomly. According to investors, you should hold your coins for a long time to gain a huge profit because it is an investment option, similar to stocks and bonds.
Before you invest in bitcoin, you need to know about P2P technology and blockchain. A blockchain is a chain of nodes that connects multiple nodes or peers. So, it is a peer-to-peer network. For example, anyone can participate in this network and add a node to validate a transaction with bitcoin. Many computers are working on the same network and you cannot find this network down at any time in the day. If any node or peer fails to perform then another node will run the system, and bitcoin or this blockchain technology cannot be controlled by any central authority like the government or bank.
How to use your coins?
Like your physical currencies, you can use your bitcoins for online transactions. You can buy anything with bitcoin. To buy such coins, you can create an account on any exchange and you can link your bank account with your crypto account. Then you can buy coins with your fiat currency. Once you purchase such coins, you can store your coins in a wallet, and you can use this wallet to make online transactions in the future. You must know that you cannot make any refund request once you make a transaction with bitcoin.
Documents required to open an account in a crypto exchange:
You need to validate your crypto account by submitting your KYC. In this case, you need to verify your account by submitting some basic documents such as personal identification proof, bank account details, and your signature. You need to submit such documents online to validate your account and you do not need to visit any branch because crypto exchanges do allow an online document verification process. Moreover, as it is a digital currency, you cannot invest in these digital assets without a secured internet connection.
People might have an idea that bitcoin will be the main currency and will take the position of fiat currency in the future. But, it is not possible because bitcoin cannot reach remote destinations where internet connection is not available.
Simple ways to invest in bitcoin:
Investing in bitcoin is not a complicated process, and you can easily invest in bitcoin by following the below-mentioned factors:
- Choose a wallet.
- Connect your wallet with your bank account.
- Place an order and buy bitcoin with fiat currency that you already have in your bank account.
Make sure, you must gather some knowledge about bitcoin and other cryptocurrencies before you trade bitcoin, as it is highly volatile.