Things to Know When Buying Bitcoin
Are you considering starting your journey using Bitcoin? Is this your first time to buy Bitcoin? A lot of people are planning to integrate Bitcoin into their financial lives. The number of individuals who are using different digital currencies, including Bitcoin, to finance their regular purchases is increasing.
But it is a wise move if you will understand how Bitcoin works before dipping your feet into its growing pool. You need to know the possible pitfalls you may encounter as you take your journey in the world of cryptocurrency.
That being said, we have gathered the important things that you need to know when planning to buy Bitcoin. Even though this post is written only about Bitcoin, the listed issues are also applicable for different cryptocurrencies you can see in the market today. Visit cpomagazine.com to know more about bitcoins.
Bitcoin is Volatile
This is a common Bitcoin issue that you have probably known already. Considering the inception of Bitcoin, different pieces of evidence will prove its volatility. In connection to that, it is important to keep in mind that Bitcoin’s price can change unpredictably and rapidly. In most cases, it can change within a few minutes.
Additionally, Bitcoin’s price may increase in just a few days or hours. As such, it can also fall dramatically. One great representation of this situation is what happened way back in 2017 December. The said digital currency has a price exchange of over 19,000 US Dollars, but after a few weeks, it drops down to 12,000 US Dollars.
Bitcoin is Transparent
Perhaps, Bitcoin is considered to be the most transparent digital currency worldwide. This is because of blockchain, the distributed ledger technology, making Bitcoin work.
In connection to that, the entire transactions that happened in this network are immutable, traceable, and stored publicly in the crypto’s blockchain. This means that each time you sell and purchase Bitcoins, all the details are being broadcasted, enabling everyone to see it.
On the other hand, the said digital currency does not require you to share your details, including your real name and exact geographical location. The only thing you need to receive and send BTC is a Bitcoin wallet address.
One of the great things about Bitcoin is that it can move peer-to-peer transactions worldwide in just a matter of seconds and at a very low cost. Compared to the traditional fiat currencies, this digital money does not use third parties to make transactions. But rather, you are required to pay the blockchain fee, which is only small.
Bitcoin can be a Bubble
As the term “Bubble” suggests, Bitcoin can have a rapid crash and abrupt increase in its price. If you take a look at the history of Bitcoin, especially what happened in the year 2011 and 2017, you can conclude that Bitcoin is indeed a bubble sometimes.
Way back in 2017 December, the Bitcoin price has reached its highest peak, which is about 20,000 US Dollars, because of the Fear of Mission Out (FOMO) and speculations.
Bitcoin is for Everyone
Another advantage of Bitcoin is that it is designed to be used by everyone. If you are planning to use Bitcoin as a way to invest, then you don’t need to be a professional investor to do so. Compared to the traditional markets that are only designed for rich people, the decentralized nature of Bitcoin enables it to be accessed by anyone.
This means that you are not alone who can buy and sell Bitcoin. Aside from that, you can also join Bitcoin mining if you are considering Bitcoin as an investment.