Already decided Bitcoin is a good investment? You can buy Bitcoin with these top exchanges: Coinbase, Uphold, eToro, WeBull, Coinmama and PrimeXBT.
Cryptocurrency has been a hot topic in the financial world, with Bitcoin leading the pack as the most well-known and widely used digital currency. It is difficult to predict whether this cryptocurrency will become the global reserve currency or a store of value as widely accepted as gold. With its rising value and potential for high returns, many investors have been lured by the promises of Bitcoin. However, there are also skeptics who warn about its volatility and lack of regulation.
So, is Bitcoin really a good investment? The short answer to this question varies depending on who is asking it. Bitcoin’s price volatility and the lack of regulation in the market make it a risky investment option. However, some individuals believe in the potential of Bitcoin as a decentralized currency and store of value, leading them to view it as a good long-term investment. Start with our guide to learn more and make your own judgment about whether Bitcoin is a good investment for you.
The history of Bitcoin
Since its inception, Bitcoin was the first digital asset that spawned the current ecosystem of cryptos. The release of the white paper describing the technology just after the 2008 financial crisis was a quiet start to the cryptocurrency revolution. For some time, it grew an underground following of investors who saw its future as a possible replacement for the physical monetary system. Now, Bitcoin has become a household name as institutions and governments develop ways to serve their clients’ growing demand for exposure.
Similar to how the Internet was once a speculative investment, Bitcoin has received similar criticism. In fact, Bitcoin’s current adoption rate surpasses that of the Internet in 1998, and millions of people now own Bitcoin. And the rate at which its adoption is spreading only seems to be increasing.
In 2021, El Salvador became the first country in the world to make Bitcoin a legal tender; Paraguay and other small countries want to follow suit. El Salvador is also the first and only country to have Bitcoin in its treasury. By late 2022, El Salvador has approximately 2,400 Bitcoin. President Nayib Bukele was not shy about announcing his purchases on Twitter.
Other countries may copy this move to attract innovation, while others may ban it altogether in an effort to save their fiat currency or pave the way for a central bank digital currency. Despite the doom and gloom of the 2022 bear market, Bitcoin has solidified its place in the global geopolitical climate, and the 2020s could be the decade of massive adoption. This has left investors wondering if Bitcoin is a good investment.
How to Invest in Bitcoin
Bitcoin is available from a multitude of centralized cryptocurrency exchanges. The safest exchanges are based in the US, which also means you must comply with the SEC’s Know Your Customer (KYC) guidelines. For tax purposes, creating an exchange account will require you to enter personal information, including your address and social security number. Once you have these on hand, you are ready to begin.
Here are the steps to invest in Bitcoin:
1. Open an account with a cryptocurrency exchange.
2. Link a bank account and deposit funds into your exchange wallet.
3. Buy Bitcoin (BTC).
4. Buy a wallet (optional).
Have you decided that Bitcoin is a good investment and want to know where to buy some? Here are some of the best crypto exchanges available today:
securely through Coinbase’s website
Sum of median estimated savings and rewards earned, per user in 2021 across various Coinbase programs (excluding sweepstakes). This amount includes fee waivers from Coinbase One (excluding the sign-up fee), rewards from Coinbase Card and wagering rewards. ³Crypto Rewards is an optional Coinbase offering. Upon purchasing USDC, you will be automatically enrolled in rewards. If you want to opt out or learn more about rewards, you can click here. The reward rate is subject to change and may vary by region. Customers will be able to see the latest applicable rates directly within their accounts.
securely through Webull Crypto’s website
securely through PrimeXBT’s website
securely through Robinhood Crypto’s website
Best for:
Buy and sell Dogecoin
Investment in Bitcoin
Before you jump on the bandwagon, it’s important to understand the potential benefits and risks of investing in Bitcoin to help you make an informed decision about whether it’s the right investment for you.
Advantages
Liquidity: Bitcoin is a highly liquid investment asset that can easily be traded for cash or other assets. It has low fees and high liquidity, making it potentially profitable for short-term investments. Lower inflation risk: Bitcoin is not subject to hyperinflation like traditional currencies because it undergoes predictable inflation at a halved rate every 4 years. The blockchain system is infinite and there is little need to worry about your cryptos losing their value. New Opportunities: Bitcoin and cryptocurrency trading is a young industry with new coins popping up regularly. The frequent price fluctuations and volatility provide opportunities for significant profits.Minimalist trading: Bitcoin trading is a simpler and more flexible alternative to stock trading, as it can be done at any time and transactions are instant, unlike the long settlement process of stock orders.
Disadvantages
Volatility: The price of Bitcoin is highly volatile, as seen by its drastic fluctuations in value. Investors who bought Bitcoin at $20,000 in December 2017 saw its value decline to $7,051 weeks later. Holding Bitcoin for long periods of time may not be suitable for all investors. Threat of Hacking: While Bitcoin’s blockchain has never been hacked, individuals can still be hacked if they give out sensitive information, such as their private keys. It is also not uncommon for lesser known exchanges to be hacked. For the best security, use a hardware wallet like the Ledger Nano X that stores your digital assets off the Internet on an external device.
Is Bitcoin a good investment despite the risk?
Similar to any speculative investment, buying Bitcoin naturally involves significant risk. As the traditional financial world realizes Bitcoin’s potential for disruption, they must choose to either adopt cryptocurrencies or face irrelevance. Its volatility risk is one of the main factors that determine whether Bitcoin is a good investment, but it is not necessarily good or bad. The personal decision to invest in Bitcoin comes down to your appetite for risk and your perspective on the future of humanity. For example, Russia has stated that they are looking into cryptocurrencies to reduce their dependence on the US dollar. Bitcoin has the potential to disrupt the US dollar in a massive way, and it is simply too big to be ignored at this point. If this disruption is successful, Bitcoin could be a fantastic investment.
The main reason a traditional investor would want exposure to Bitcoin is to hedge against inflation and possibly the collapse of the fiat-based economy. Bitcoin’s volatility is a concern for potential investors, but volatility is expected to decrease forever as institutions and governments enter the market with long-term interest.
Bitcoin Technical Analysis: Fear and Greed Index
The fear and greed index can be a useful indicator of cryptocurrency market sentiment. The general sentiment of the market can be a useful factor when deciding whether Bitcoin is a good investment for you. Historically, times of greatest fear have generally been bullish indicators (indicating that the bottom is in or near) and times of highest greed are often bearish indicators (indicating that the top has been reached or is near). The fear and greed index isn’t perfect and doesn’t always predict the future well, but it can be a good tool for making an educated guess. Bitcoin’s recent resurgence has brought its fear and greed index to neutral from extreme fear only a few weeks ago.
Can Bitcoin be exchanged for real money?
Bitcoin can be easily converted to cash in a bunch of different ways. You can sell Bitcoin on a cryptocurrency exchange like eToro or Crypto.com. This is usually the easiest option. Once you sell it for cash, you can withdraw it directly to your bank account. This is a simple way to convert your Bitcoin to cash, but you have to remember that the price of a Bitcoin changes all the time. Yes, you may need cash, but you could be kicking yourself a few years down the road if the price of Bitcoin skyrockets over and over again.
Bitcoin ATMs are expensive, but if there is one near you, you can exchange your Bitcoin for cash there. However, these ATMs often charge hefty fees, so you’re most likely much better off using an exchange.
How will Bitcoin perform in 2024?
It is difficult to predict exactly how Bitcoin will perform in 2024 as it is influenced by various factors such as market demand, government regulations, technological advancements and investor sentiment. However, based on historical trends and the growing popularity and adoption of cryptocurrencies, it is possible that Bitcoin will continue to experience growth and possibly reach higher levels in terms of value and adoption. It is important to note that investing in cryptocurrencies carries inherent risks and it is advisable to conduct thorough research and seek professional advice before making any investment decisions.
Bottom line
Still wondering if Bitcoin is a good investment? It can be, as long as you do your research and understand the market before considering investing in Bitcoin. Factors such as market trends, regulatory changes, and technological advancements can greatly affect the value of Bitcoin. However, investors can turn Bitcoin into a bad investment if they try to treat it like any other asset.
Disclosure: ²Sum of median estimated savings and rewards earned, per user in 2021 across various Coinbase programs (excluding sweepstakes). This amount includes fee waivers from Coinbase One (excluding the sign-up fee), rewards from Coinbase Card and wagering rewards. ³Crypto Rewards is an optional Coinbase offering. Upon purchasing USDC, you will be automatically enrolled in rewards. If you want to opt out or learn more about rewards, you can click here. The reward rate is subject to change and may vary by region. Customers will be able to see the latest applicable rates directly within their accounts
Show more
More about Cryptocurrency
Check out more cryptocurrency content and learn about the space or start investing!
Disclaimer for Uncirculars, with a Touch of Personality:
While we love diving into the exciting world of crypto here at Uncirculars, remember that this post, and all our content, is purely for your information and exploration. Think of it as your crypto compass, pointing you in the right direction to do your own research and make informed decisions.
No legal, tax, investment, or financial advice should be inferred from these pixels. We’re not fortune tellers or stockbrokers, just passionate crypto enthusiasts sharing our knowledge.
And just like that rollercoaster ride in your favorite DeFi protocol, past performance isn’t a guarantee of future thrills. The value of crypto assets can be as unpredictable as a moon landing, so buckle up and do your due diligence before taking the plunge.
Ultimately, any crypto adventure you embark on is yours alone. We’re just happy to be your crypto companion, cheering you on from the sidelines (and maybe sharing some snacks along the way). So research, explore, and remember, with a little knowledge and a lot of curiosity, you can navigate the crypto cosmos like a pro!
UnCirculars – Cutting through the noise, delivering unbiased crypto news
