Investing in Bitcoin can be somewhat intimidating, especially if you are just getting to know about Bitcoin’s existence. Taking the bold step and delving into the world of cryptocurrency can be very risky for both the novice and the experts. This is because there is no authority or government support to guide investors. Apart from investing money into digital currency, investors also need to invest their time and effort to learn how Bitcoin works. Considering the recent circumstances, you may ask – “should I invest in bitcoin in 2020?”
The Adoption Of Bitcoin Continues
Bitcoin is one of the biggest players in the world of digital currency, and it has increasingly doubled its effort to become an alternate choice of payment. As a result, the use of Bitcoin has been on the increase. It is being discussed in financial conferences, business meetings, and the likes. This is a pointer that Bitcoin will still be adopted in many years to come.
The value of bitcoin was $11,000 around December 2018, and currently, it is less than $10,000. There are chances that it may increase to $15,000 by the end of 2019 and span through early 2020. Hence, this could be the best time for intending investors to come on board and adopt BTC.
Factors Behind Growth of Bitcoin
There are so many promotions to make the mass embrace BTC. As a result, crypto investors, enthusiasts, and market analysis have faith that Bitcoin will soon change the financial system globally. It will also empower and render transparency in the upcoming years.
Many factors have contributed to the growth of Bitcoin. The transaction fee promised on Bitcoin is lower than the most traditional payment made online. Whenever the goods are paid for using Bitcoin, the system on the Bitcoin blockchain immediately checks the accuracy of the transaction. No bank can stop its payment as BTC is a currency that can be used to make payment across borders. Similarly, as a global and secure currency, BTC has the same effect on the global economy and finance.
If you truly understand the abilities of Bitcoin and how it can impact the global economy, it will be easy to know why you should invest in Bitcoin in 2020.
Buying & Holding
You need to employ strategies to manage BTC price fluctuations. Investors should buy Bitcoin when its price is low and hold it. Investors need to resist the urge to buying and selling as soon as they notice a slight increase. One of the rules in the world of cryptocurrency is practicing passive investment because your chances of success are higher than investors who practice active investment.
The best and the most common way to invest in Bitcoin is to buy the currency at a low price and hope that value will increase. But, don’t let anyone frighten or advice you with what they think will befall BTC. You must be well informed of the investment. Accessing information on the internet is now easy, so carry out thorough research yourself.
Important rules for buying and holding Bitcoin
- Always have it at the back of your mind that investing in Bitcoin is very risky. You don’t need to put all your eggs in a basket. Therefore, do not mortgage your home or properties to invest in Bitcoin.
- Above all, never leave your Bitcoin(s) on an exchange after buying them. If the amount is huge, you should use a paper wallet or hardware wallet if you can afford it.
- To prevent cybercriminals from hacking into your wallet, make security a priority. Also, ensure that you buy your Bitcoin from a reputable, reliable, and recommended seller. This way, your peace of mind will be guaranteed.
How To Invest In Bitcoin And Where To Buy?
As an investor who has not experienced venturing into trading bitcoin, the following steps are required:
If you have taken your time to do research on BTC thoroughly and you are now ready to join BTC investors moving train, congratulations! There are many options to choose from when creating a bitcoin wallet. As a beginner, you should use Coinbase as it is secure, and they ensure the safety of your information.
2. Link a bank account
You need to link your wallet to a bank account for purchasing bitcoin. Connecting your bank account to your wallet enables you to buy and sell BTC and also deposit the money to your account directly. Also, you can instantly buy bitcoin using a credit or debit card. You may be charged a small fee (about 5%) as transaction fee. Most exchanges, including Coinbase, allow users to only purchase cryptocurrency using debit cards.
3. Buy Bitcoin
You are now ready to invest in your first bitcoin. One bitcoin costs several thousand dollars. It can be broken down to eight decimal places. For example, if one bitcoin costs $3890, it becomes $389 for 0.1 BTC.
Where To Invest In Bitcoin?
Certainly, this is dependent on your country. There are more liquidity and options in a developed country. Therefore, you should join Bitcoin exchanges. Bitcoin exchanges are a marketplace where one can trade BTC online for normal currency, like trading BTC for USD.
Bitcoin can be traded by two or more exchanges, though their services may slightly differ from one another. To clarify, exchanges may differ in terms of reliability, reputation, exchange rate, processing fee, and the available options of cryptocurrency.
As a new investor, before you finally decide to invest with any exchange, carry out a thorough research. Here are two exchanges that are quite popular:
This exchange has a way of securely buying and storing Bitcoin in one place. As a result, this is one of the most respected, trusted, and biggest exchanges in the world. Also, it charges 1% for any transaction made from the Coinbase USD wallet or bank account in the US. 2.40% is charged for any transaction carried out using debit or credit cards. Coinbase exchange is also available in most of Europe, the UK, Singapore, Canada, and the United States.
When you are planning to diversify your digital currency portfolio, the Binance exchange is your best bet. This exchange supports various traditional currencies and multiple cryptocurrencies. Binance charges a 0.1% flat brokerage for transactions. Though this exchange offers different currencies at a very low price, users may experience a delay while withdrawing some currency.
Note that you’ll need to already own Bitcoin since they don’t support fiat as a payment.
When Is The Right Time To Buy?
Just like any other investment, nothing is really for sure. According to history, the value of Bitcoin has increased generally at a speedy rate. This is followed by a steady and slow downfall that settles. Hence, one should use tools like Cryptowatch and Bitcoin wisdom to analyze charts and understand the history of Bitcoin price.
Bitcoin is global and instability or financial situation of any country cannot affect it. Likewise, BTC cannot be influenced or controlled by any government, as mentioned above. Therefore, when thinking of when to invest in BTC, it is necessary to think on a global scale on how the economy and politics can affect BTC price and not how it can be affected by the economy and politics of a single country.
Appreciation And Mining of Bitcoin
It is no longer news that the masses are investing in cryptocurrency. The price of BTC was $710.09 in 2016. On February 21st, 2019, a single BTC was exchanged at a rate of $3,890. In short, you don’t need to have a degree in Economics to know that those who invested in Bitcoin a few years back are now shaking hands for the huge profit made.
According to the BTC program, every four years, the rate of BTC production is halved. For instance, the rate of BTC production was 7,200 every day or 50 BTC every ten minutes when it was launched on January 3rd, 2009. As of November 28th, 2012, the production rate of BTC changed to 25 from 50 every ten (10) minutes or the production of 3,600 Bitcoin every day. Then on July 9th, 2016, this rate was cut in half again to 12.5 every ten minutes. Based on this history, it is possible to cut in half for the 4th time in 2020. Thus, the circulation of the sum number of BTC will be 21 million.
Based on how the production of BTC is halved every four years, it is now becoming hard to get the currency. About 82.7% or 17.37 million of the Bitcoins were created as of February 2019. Therefore, failing to meet up the production rate with the demand for BTC will increase the price.
No matter how popular Bitcoin is, it is highly unpredictable. Though the worth of BTC is $ 9,890 today (November 2nd, 2019), it was worth $19,783.21 on December 17th, 2017.
|If You Bought Bitcoin by the time of writing this article (9th November)||Rise In Percentage (%)|
|1 month ago||14|
|2 months ago||23|
|5 months ago||35|
|8 months ago||65|
|1 year ago||108|
|2 years ago||400|
|3 years ago||1840|
|4 years ago||5300|
|5 years ago||24750|
|6 years ago||12800|
Frequently Asked Questions – FAQs
Bitcoin is a digital currency fully controlled by users and has no central authority.
Not a single entity controls Bitcoin currency; users around the world control BTC. Softwares are being improved upon by Bitcoin developers, but a change in Bitcoin protocol can’t be implemented as every user has a choice to pick the version of the software they want to use. Users have to use the software that complies with the same rule as Bitcoin tends to work well when there is a total agreement among the users.
Yes. The number of people and businesses using Bitcoin is steadily increasing. Though Bitcoin is relatively new, it is growing at a fast rate. In May 2018, the value of existing Bitcoins was over $1 billion, and bitcoins worth millions of USD are being exchanged daily.
It is very easy using Bitcoin for payment than using a credit or debit card, and it doesn’t require a merchant account to receive.
You can make a payment from your wallet application using either your smartphone or computer. You need to enter the receiver address and the amount, then just press the send.
Liberty in payment: Bitcoin can be received and sent from anywhere in the world anytime, any day. As a result, no bureaucracy, no holidays, no borders control it.
Flexible fees: The fees for transacting Bitcoin are not fixed. When spending, many wallets allow you to control the fee to pay. The higher the fee you pay, the quicker the transaction is confirmed. Fees are not connected to the transferred amount. For example, the fee paid on a transfer of 50,000 bitcoin is the same fee that will be paid for the transfer of 1 Bitcoin.
Less risk: Bitcoin transactions do not expose the customer’s personal information. It is secure and irreversible. Therefore, customers are secured from fraudulent chargebacks and fraud.
Protection and full control: Bitcoin users have total control over transactions executed by them. Though possible with other methods of payment, it is not possible for merchants unnecessarily when Bitcoin payment is mode of payment. BTC users can protect their money with encryption and back up. It also prevents other users from stealing Bitcoin users’ identities.
Should I Invest In Bitcoin In 2020? Why?
With the information you’ve now got about Bitcoin, you’ll have to come up with your own conclusion wether you should buy BTC or not.
Big online stores and businesses are now giving clients an option to pay in Bitcoin, which can be considered to show that Bitcoin actually has a big impact in our economy.
There is only about 22% of bitcoins yet to be mined. According to future forecast, which makes Bitcoin even more ”exclusive”.
Timing is essential when you want to invest in Bitcoin. Once you have decided on your point of entry, don’t relent or give up. Having in-depth knowledge about BTC doesn’t mean you should use up your capital buying BTC. You shouldn’t also overlook risk factor as it is not far-fetched from every other investment. Therefore, proceed cautiously, taking a step at a time as one wrong step can cause you to fall drastically.