“When wanting to trade with Bitcoin in an online world, you need to take into consideration that Bitcoin is a currency and not a company. When trading stock online, you are investing in company shares. When trading with Bitcoin, you are actually trading with an international, virtual currency,” says senior cryptocurrency analyst at Wilkins Finance, Damian Hampton.
If you want to start trading with Bitcoin, there are a number of ways you can invest and hopefully, make a profit. When trading, you need to take the following points into consideration:
What does it mean to buy and hold Bitcoin?
An easy way to explain this term is thinking of it as an object you buy and then keep in the hope that its value increases. When its value increases, you sell it and make a profit from it. When you have purchased a Bitcoin and the market dips, you can either choose to hold it for a while to see if the market will rise again. You need to remember, though, not to hold onto an investment for too long as you stand the chance to lose almost all your money if you don’t set a stop-loss for your trades. When trading Bitcoin, you need to be aware that it is a highly volatile market and the Bitcoin price rises and falls almost every few seconds. When making use of the buy and hold option, you need to do your research, make sure you only use reputable trading platforms and only trade with what you can afford to lose.
What does it mean to trade Bitcoin?
Trading Bitcoin works a little different than when making use of the buy and hold option. When trading Bitcoin, you purchase the currency at a low price (when the market takes a dip) and sell it at a higher price (when the market rises) within a short period of time. As this takes a huge amount of risk and a lot of experience in the online trading world, you need to be careful when trading Bitcoin. You can easily lose all the money you have invested if you don’t read the market correctly or wait too long before selling the purchased Bitcoin.
What does it mean to invest in Bitcoin mining?
If you decide to mine Bitcoin, you would need to do so in large scale in order to make a profit. Bitcoin mining is done by making use of specialised equipment that connects to your PC. This equipment solves complicated mathematical equations and once solved, a new Bitcoin is mined and set into motion into the cryptocurrency world. After successfully mining a Bitcoin, you can either hold it to sell off, you can trade it in the hopes of making a profit or you can use it to purchase items.
What does it mean to invest in Bitcoin companies?
If you want to invest your Bitcoin in a Bitcoin company, you need to be 100% sure that the company is legit. An easy way to find out whether they are legit or not is looking at what they promise you. If they promise to double your Bitcoin in a matter of a few days or offer interest on it, you will instantly know that they are not legit.
When looking at the above-mentioned points, it is clear that you need to do your homework thoroughly before deciding whether to trade with virtual currencies or not. However, if you have enough experience with trading and know enough about Bitcoin, you can make huge profits from the Bitcoin trading market. As this currency is not government-regulated, there is no limit to the amount you can make or what Bitcoin is worth at a certain point in time. In 2017, Bitcoin slammed a value of over $ 10 000, and although it fluctuates a great deal, there is no way to know where it will go next. Investors see it as a roller-coaster ride but as an investor, who wouldn’t want to go after something that provides them with a thrill?
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