What Every Investor Should Know When Buying Bitcoin

Buying Bitcoin can be a great way to explore a new investment. The value of this popular cryptocurrency has increased. However, Bitcoin is more volatile than a lot of tried-and-true investments like mutual funds, bonds, and stocks. If you are new to Bitcoin investing, keep reading to learn more:

Where to Buy Bitcoin

There are many ways to buy Bitcoin including the following:

  • Bitcoin exchanges: There are many Bitcoin exchanges out there that even accept other cryptocurrencies. Paychain charges a percentage of the purchase price. But, because fees and offers vary by exchanges, do your due diligence to find the right one. 
  • Traditional stockbrokers. Although there are only a few conventional brokers available to offer a way to purchase and sell bitcoins, you can surely find one. Some of them do not charge fees for bitcoin trades. 
  • Bitcoin ATMs. These ATMs work like normal ATMs but they can be used for buying and selling bitcoins. 
  • Peer-to-peer transactions. Bitcoins can also be bought directly from other bitcoin owners. This is possible for through peer-to-peer tools. But, it’s important to use extreme caution when going this route.

Tips Before Buying

To make sure you purchase Bitcoin right, consider the tips below:

  • Ensure you have all the necessary information. Setting up a Bitcoin account takes just minutes; however, you must give some information such as your bank account number, social security number, and credit or debit card number to fund your account. Also, some providers may ask you to give a picture ID. Make sure to record and protect any new passwords for your  Bitcoin account or digital wallet.
  • Avoid using a credit card when possible. While a number of providers may let you buy Bitcoin using your credit card, borrowing from a high-interest product like a credit card to invest is not a good idea. 
  • Make sure your internet connection is private and secure. This is something you must prioritise whenever you make any financial decisions online. Buying bitcoin while at a public place or anywhere where you connect to a public internet connection is not advisable. These connections are not secure and that hackers can easily crawl your account and steal your digital asset. 
  • Choose a reputable exchange. Keep in mind that Bitcoin is not insured for exchange theft or failures. While some exchanges offer private insurance, this does not protect against breaches such as somebody stealing your password. Do your due diligence before choosing an exchange. 

Paul Petersen

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