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Sunday, December 5, 2021

How to Invest in Bitcoin

Investing in cryptocurrencies can be a confusing experience – Where do I begin and what options do I have? Hi, I’m Nate Martin, and we’re going to cover how to invest in Bitcoin and cryptocurrencies in our 2…minute.tutorial. Today well cover three options for investing in Bitcoin or any other cryptocurrency. The first is buying actual Bitcoins and storing them inside your personal Bitcoin wallet. 

This method is probably the most complex, but also our most recommended way to invest in Bitcoin of the three. With this option, you’d need to find a Bitcoin exchange, deposit money into it and convert that money into Bitcoin. Once that’s done, you’ll need to get a Bitcoin wallet so you can move your coins off the exchange and into that wallet for safekeeping.

The second option for investing in Bitcoin is derivatives trading. With derivatives, you won’t be buying the actual coins. Instead, you’re buying a contract that mimics the behaviour of the coin. 

If the coin goes up in price you can sell the contract for a profit but if the coins price drops – you’re at a loss. With derivatives, there’s no need for a Bitcoin wallet since you don’t actually own Bitcoins. 

Just open an account, deposit money and start trading. Derivatives also allow for leveraged trading, which means you can borrow money to increase the amount you want to trade.

However, this option is considerably riskier and is suitable only for experienced traders. Finally, you can invest in a Bitcoin exchange-traded fund or Bitcoin ETF for short. Investing in an ETF also means you’re buying a contract and not an actual coin. 

ETFs are traded on regulated stock exchanges and try to mimic Bitcoins price moves although they might not reflect Bitcoins price with complete accuracy. 

Today, there is still only a handful of Bitcoin ETFs available. ETF investing is geared toward the average investor who doesn’t want to deal with opening accounts or downloading wallets. You can invest in an ETF the same way you invest in stocks – through your bank, financial advisor, or conventional trading platform. 

So there you have it: our top three picks for the best ways you can invest in Bitcoin today. Once you decide which option is best for you, you can find our complete step by step guides by clicking the links in the description below this video and I’ll see you…in a bit.

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