Before enjoying some of our content, here is a beginners guide answering some very basic and common questions about Bitcoin. Our goal here is to establish a strong base and grasp over the fundamentals of cryptocurrency.
"Never invest in a business you can't understand."
- Warren Buffett
Bitcoin was created in 2009 as an alternative to fiat and traditional central system;
It is a decentralized currency that removes third parties and functions on a peer-to-peer network with no governing body and no unnecessary intermediary.
You can purchase Bitcoin using fiat at any major, reputable online cryptocurrency exchange, such as Coinbase, Binance, Kucoin, even Paypal, just to name a few.
Buying Bitcoin in 2021 is safe, secure, convenient, and fast; all it takes are a few simple steps to protect yourself and your assets before purchasing your first tokens and having them to your name.
The price of Bitcoin is volatile, and relies heavily upon supply and demand, as well as news in the market and the overall sentiment of the investor pool.
It is not uncommon for Bitcoin to gain or lose several thousand dollars within a day, and investors must be prepared to encounter market swings that are either bullish or bearish in nature.
As time goes on, volatility is expected to diminish; seeing as Bitcoin is still in its infancy stage, these large swings are entirely expected.
Ultimately however, as the saying goes, 1 Bitcoin will always equal 1 Bitcoin.
Bitcoin allows for users to benefit from more autonomy and the benefits of a deflationary asset; Bitcoin is finite, and as the supply dwindles and demand increases, so too will its value.
Bitcoin is extremely secure and digitally protected, as well as being quick, efficient, immune to manipulation, and completely transparent.
Bitcoin removes the third party and allows for transactions to be made free from banking or government interference.
Some of the disadvantages of Bitcoin include volatility, risk, slow adoption, and lack of information made available for the general public.
Some would also argue that the absence of government regulation and oversight make it prone to cybersecurity attacks and uses for crime, drugs, and money laundering.
Bitcoin is legal internationally, as it cannot be banned or stopped without shutting down the internet as a whole, something that is inconceivable and unfeasible.
Use varies from country to country, and Bitcoin has only been accepted as legal tender in El Salvador as of July 2021.
Tax implications and purchasing vary from country to country, as do banking laws surrounding the buying and selling of the digital asset.
While Bitcoin is entirely legal, the laws surrounding its distribution and sale are under constant change from governments large and small who seek to identify how to control what is essentially uncontrollable.
The price of Bitcoin is determined by an increasing demand and a decreasing supply.
Bitcoin cannot be duplicated or replicated. The price will go up when buying volume and bullish pressure increases, and the price will go down when selling volume and bearish pressure increases.
Scarcity, utility, divisibility, and convenience are all major factors that play a role in setting the present dollar value for Bitcoin.
Bitcoin is a legitimate asset with legitimate value; companies with Bitcoin on their balance sheets include Tesla, Voyager, Square, Microstrategy, and the US government, just to name a few.
Much of the negative correlations associated with Bitcoin and cryptocurrency can be attributed to fear of a new technology that threatens to undermine an outdated system in need of change and modernization.
Bitcoin is real money, holding a real dollar value; cryptocurrencies are entirely virtual and based upon a software, protected digitally and with value based solely upon supply and demand, not government stimulus or inflation.
You can exchange your coins for their value in fiat, or can make purchases directly using Bitcoin. Certain Subway sandwiches locations allow payment with Bitcoin, as well as Home Depot, Microsoft, AT&T, Xbox, Expedia, just to name a few.
If you are of the opinion that Bitcoin is poised to revolutionize our current financial system, then the present market price is irrelevant; the dips, highs and lows present buying opportunities to accumulate the asset now while it is still at a modest price.
With this mindset, Bitcoin is a long-term investment, with its value poised to continue growing over the next years and decades.
While you may buy now and watch your investment double within a year if not a few months, thinking with longevity in mind and holding your asset for as long as possible will prove far more lucrative and rewarding.
Not at all! Very few people nowadays can afford to outright buy themselves a full Bitcoin.
The beauty of Bitcoin is you can buy as little as $1 worth at a time if you see fit. The quantity is entirely up to you, and depending upon the current market price you can purchase varying quantities of the asset.
A lot less Bitcoin then you might think is needed to put you in the minority.
Just owning 0.28 Bitcoin will put you in the top 1% of Bitcoin owners worldwide.
What comes up, must come down. It would be false to say that Bitcoin just goes up in the short term, as Bitcoin, just like any other asset or market, has experienced crashes at one point or another.
In 2010, one Bitcoin was worth 7 cents, and today, no matter when you are reading this, it is no doubt worth exponentially more. While the price may have dipped and crashed at times, the presence of higher lows and higher highs indicate upwards momentum over the past decade.
A common idiom amongst investors is "when in doubt, just zoom out", meaning, instead of focusing on price action within the last six months or even year, zoom out of the chart and focus on the complete picture, and watch the trend line as a whole, not a partial.
Bitcoin has been used in narco-trafficking, terrorism, extortion, money laundering, and just about every other major crime punishable by life in prison.
That being said, traditional money is still king when it comes to criminality, and while Bitcoin and fiat inherently are not evil or made with the intent of carrying out crime, they can be used for such purposes.
As of 2020, less than 0.34% of Bitcoin transactions were used for criminal activity, as opposed to 5% of fiat being used for similar purposes, in a study published by the United Nations and corroborated by Chainanalysis.
First off, you're in the right place.
The beauty of Bitcoin is its ease of access and convenience for purchasing and safe-keeping. Opening an account with a certified exchange is simple and reputable, and purchasing can be made via bank transfers, debit card, even over the counter at certain locations.
You do not need to be a banker or a millionaire to get involved and make your first purchase.
Buying as much as your budget will allow and simply holding onto your asset is a far better and safer investment strategy than leverage trading without proper experience or risk management.
Be sure to continue reading and discovering our page and posts to grow your confidence and deepen your understanding, and you will see that when Bitcoin is broken down and simplified, it is far less daunting than it appears to be.
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