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Satoshi Nakamoto presented Bitcoin, a decentralized digital currency, to the public in 2009. Now valued at ~$16,500 per coin, with nearly 2,000-percent growth in 2017, you’re probably kicking yourself for not investing in it sooner. Maybe you’re looking for that perfect holiday present to bore your nephew to tears that you hope will appreciate in value. It’s likely you’re among the millions of people who searched “How to Invest in Bitcoin?,” making it one of the top Google searches in 2017.
You ask, and we deliver. Here’s how you can finally invest in Bitcoin. And no, it’s not too late.
Should you invest in Bitcoin?
Before whipping out the plastic, first ask yourself why you’re interested in becoming a part of a cryptocurrency movement.
As an investment, Bitcoin is like anything else in your portfolio: Prices can rise and fall, and it is in a bubble. If everyone suddenly stopped taking your dollars or euros, this bubble would burst and the value would drop to zero. The same goes for Bitcoin. Historically, this is unlikely to happen. On the bright side, Bitcoin is empirically a great investment. There is a fixed supply (there will never be more than 21 million bitcoins), and it’s encrypted, which it makes it easy to store, hide, and protect. Transactions of Bitcoin are irreversible, and data about all parties holds buyers and sellers completely accountable.
Hardcore fans of Bitcoin believe that being too “price-focused” is not the point of investing in Bitcoin. It’s true that cryptocurrencies, and specifically Bitcoin, have the possibility to globalize currency, overturn and reset our dependence on banks, vastly improve the speed of transaction times, and overall revolutionize how we, and computers, handle money. Few developers expected to “get rich” off of Bitcoin. The cryptoworld does not view the currency as a “loophole” to evade the constraints of modern money. So when investing in Bitcoin, it would be wise to see the coin’s popularity as a sign that cryptocurrency technology is the exciting part—not just your capital gains.
How to invest in Bitcoin
Buying Bitcoin is shockingly easy. The first step is to find a Bitcoin “wallet” that will hold your keys and works for what you’re trying to achieve. A key, by the way, is a unique strand of numbers and letters that allow you to access your coins through encryption. Some wallets are simply storage sites. Others also serve as exchanges where you can buy and sell Bitcoin, convert your coins to USD or euros, and/or day trade the currency.
You’re also going to need to think about if you care about verifying your identity, how long the transaction will take, and what method of payment you’d like to use. Different wallets also have varying caps on how much you can buy and withdraw in a day, and there are various fee structures you will need to consider. BestBitcoinExchange.io is a great review site for ensuring that no matter what wallet you select, your coins and personal data will be safe.
The easiest and most popular site for U.S. residents is Coinbase. It’s beginner-friendly and has a trust evaluation of an A+. Other awesome places to purchase bitcoins are etoro, Bittrex, and LocalBitcoins.
Next, decide the dollar amount you’ll want to spend, or how many coins you’d like to purchase. You may be thinking, “But I can’t afford a coin worth $16,000!” Chill out: You can buy pieces of bitcoins: down to one hundred millionth of a single bitcoin (0.00000001 BTC), or ~$.0.000165.
Next, you’ll be asked to connect your banking info to a wallet. Depending on the exchange, you may be using a direct bank transfer, Paypal, a credit card, or another cryptocurrency to purchase your coins. Most likely, this will require verification from your bank, and it often takes a couple business days to set up. Don’t expect to be able to buy your bitcoins the same day you register with an exchange.
Once you’re all verified, enter the amount you wish to purchase and press “Buy.” Welcome to the world of cryptocurrency!
- Is Bitcoin safe? Here’s how to protect your Bitcoin fortune
- Here’s everything ‘The Big Bang Theory’ got wrong about Bitcoin
- Everything you need to know to understand Bitcoin
Are there any other ways to buy Bitcoin?
You bet. You can accept BTC as payment for goods and services on sites like Bitpay. You can also mine the coins yourself by setting up a rig that generates bitcoins (difficulty level: high). Or, you can visit an official Bitcoin ATM in your area, and buy your BTCs directly with cash.
The bottom line
Do your damn research, be prepared to wait some business days for everything to go through, and don’t go too crazy. And as with all investing, you should only invest what you can afford to lose. Happy coining!
Claire Downs is a tech reporter who covers the intersection of the internet and pop culture. A third-generation worker in the Chicago futures industry, she specializes in cryptocurrencies and altcoins. Her work can also be seen in Cosmopolitan, Vice Motherboard, VH1.com, and Merry Jane.