Bitcoin: Digital currencies have become the preoccupation of many investors and economists around the world at the present time, after the increase in talk about those currencies, especially Bitcoin, and after its rise significantly at the end of last year, and then this. The rise has turned significantly lower so far.
Digital currencies are a mysterious piece of code, or a decentralized currency, that is, virtual, intangible, and made by programmers, and they started dealing with it, Bitcoin is the first digital currency that has appeared and will be the focus of our conversation today.
What is Bitcoin simply
Bitcoin is a fictitious or virtual digital currency, which is traded entirely over the Internet only without a physical presence to it.
It differs from other traditional currencies, the euro, dollar, sterling, and other paper currencies have a tangible physical presence, unlike bitcoin, which is used through Internet transactions and is not controlled by any authority or central banks.
Cryptocurrency relies on thousands of computers around the world that validate transactions and add more bitcoins to the system.
Bitcoin Inventor: Fact or Fiction
Bitcoin first came out on January 3, 2009, and behind it was a person who called himself “Satoshi Nakamoto,” and described Bitcoin as a peer-to-peer electronic cash system.
It means direct dealing between the buyer and the seller without the presence of an intermediary between them.
Australian entrepreneur Craig Wright emerged at the end of 2016 that he had invented the currency, but his deception was easily debunked. The first trading price of bitcoin against the dollar was published, and the price of one bitcoin was equal to $0.001.
Who is issuing Bitcoin
Bitcoin is a decentralized currency as mentioned above and there is no authority or regulatory body that issues it, and users produce it through a process called mining.
As the production of bitcoin requires an internet connection and a computer suitable for the mining process to produce the currency.
In a process called mining or mining for Bitcoin by means of programs that use complex processes that enable anyone with mining equipment to produce Bitcoin electronic currency.
But the mining process has become not as easy as it was in the early years of mining, due to a large number of miners around the world, which made it difficult to obtain this currency.
What are the advantages of Bitcoin
a)Low fees: Instead of entering a middleman between you and the merchant to transfer money. Bitcoin solves this problem because the currency has not been transferred, but the currency code is the one that comes out of your wallet, dear reader, and enters the merchant’s wallet.
b)Confidentiality and privacy: What distinguishes this currency from traditional currencies, Bitcoin enjoys a high degree of confidentiality and is not subject to supervision by banks or financial institutions.
c)A global currency: It is not linked to a specific geographical location, so it can be dealt with as if it were the local currency, as it is not linked to a specific country or central bank, not even to an economy.
d)Scarcity: The inventor of the Bitcoin currency plans to issue only 21 million units of it, until 2040, which contributes to preserving its value and prevents it from collapsing, as it is designed in a way that prevents any transaction or action from being rolled back, and it is issued collectively across the network.
What are the disadvantages of bitcoin
a)Cryptography: The encryption of the currency and the secrecy of the way Bitcoin is created through complex equations, make it an easy path to many shady operations. Bitcoin is not censored by anyone and thus many outlaws have found refuge to use Bitcoin for illegal operations such as terrorist financing, money laundering, arms, and drug trade as well.
b)Currency fluctuations: Bitcoin is not based on any assets or fair valuations that can be used to predict the rise or fall of this currency. Bitcoin and other digital currencies are witnessing great fluctuations in terms of price, after the price of one bitcoin reached 65,000 dollars, the price of the currency fell to 19,000 dollars at the present time.
c)Mining: Doubts arose about the mining process, as no one knows the equations that the device solves, which made some suspect the existence of an organization working in secret to solve equations that may need hundreds of years in a short time through the method of equations. They are split on servers, but they remain only suspicious.
d)Identity of its inventor: The anonymous identity of Satoshi Nakamoto, no one knows if it is a man, a woman, or a group of people, and we do not know how much currency this character has. If a country hid behind this character and owned the largest share of it, this would change the centers of power in the world.
How do I get bitcoin
After obtaining the wallet, you can start accumulating your digital currency in many ways, including buying from companies that provide this service, through someone who wants to sell bitcoin, or through mining.
The process of Bitcoin mining at the beginning of the emergence of the currency was a very profitable method, but with the development of technology and the increase in the number of miners on the currency, the process has become not profitable at all, as it requires that you have a supercomputer, to be able to the mining process.
Digital currency can be obtained by exchanging it for traditional currencies such as the dollar and others, or by adopting it in the process of accepting payments for thousands of goods and services provided online, in restaurants, cafes, and others.
Your practical guide to buying bitcoin as a beginner investor
If you are one of those who decided to invest in cryptocurrencies for the first time, after weighing the pros and cons of investing in Bitcoin; There are a few things recommended on our site, we provide the steps below as a guide to buying Bitcoin and also provide a starting point for you, dear reader.
First, you have to choose a cryptocurrency exchange or platform to make the purchase; provides the possibility of buying and selling bitcoin and many other altcoins; Each exchange has different consumer fees and services than other exchanges.
Also, in cryptocurrency exchanges, bitcoin investments are not secured by the Securities Investor Protection Corporation; However, dealings are made based on the reputation, regulation, and security procedures that are carried out in the various exchanges, which are essential factors in choosing the appropriate platform.
Some exchanges offer insurance against loss, but with certain conditions. All you have to do is carefully and carefully choose the platform where you will buy and sell bitcoins.
Here are examples of some of those stock exchanges, namely:
Coinbase: One of the largest and first publicly traded stock exchanges, famous for its ease of use, but high fees.
Binance: It is a platform that is not easily accessible to beginners, but it offers low transaction costs and many cryptocurrency options.
Crypto.com: is a platform that has fewer features than some of the larger exchanges but offers unique features like a crypto rewards debit card.
Gemini: Like Coinbase, it offers a beginner-friendly interface and is available in all US states, a feature not found on many other platforms.
Kraken: Founded in 2011, Kraken is one of the oldest cryptocurrency exchanges with high-level cybersecurity options.
How to Carefully Choose a Bitcoin Wallet
After buying bitcoins, they must be stored in a wallet:
- Hot wallet
- Cold wallet
Hot wallets offered by most cryptocurrency exchanges allow you to access your coins online and facilitate transactions, but they are not the most secure because they are vulnerable to hacking.
Cold wallets are a safer option for long-term storage of your coins, as they are portable devices like a flash drive that allow you to store your bitcoins offline for added security, like Ledger Nano and Trezor.
Connect your bank account
process of buying and selling bitcoin will need to link a bank account to a cryptocurrency exchange or your wallet, as this process is similar to linking a bank account to a traditional investment account and allows you to exchange dollars for cryptocurrencies.
Submit a stock exchange request
Once you set up your account and link your bank account, you are ready for the easiest step, which is to place your order, as most exchanges offer multiple ways to place orders, such as market orders, limit orders and stop orders.
You can also choose to set up recurring purchases, which allows you to update the average dollar cost of bitcoin by buying a set amount each month, week, or even day.
For example, if you have a side income of $1,000 per month that you automatically want to invest in, you can choose to place a standing order to buy $1,000 worth of Bitcoin at the end of each month.
Manage Your Investments (Manage Your Portfolio)
In this step, you define your investment goals, and when your coins are safely in your wallet, you can manage them in multiple ways, including:
HodL: Known colloquially as "hold on to dear life"; Where you can keep your coins in the hope of further appreciation in the future.
Trading: If you are an active trader and want to take advantage of Bitcoin's volatility, you can choose to buy and sell it from your wallet.
Buying: There is a growing range of crypto-denominated products and investments that you can choose to purchase, such as non-fungible tokens and digital real estate.
How much should I invest in bitcoin
Despite the growing acceptance of Bitcoin in mainstream investment circles, it is still a relative newcomer.
The investor must also know the history of its extreme volatility and the ever-changing process of regulation in the cryptocurrency markets.
This is before determining the amount of investment in it because there are many unknown and changing things in this market, which makes the future always high risks, and high earning opportunities in it are also high.
Experts advise investing with money that can be wasted, as they believe that the appropriate percentage for investing in digital currencies ranges from 2 to 5% of the net worth of investors.
What does the bitcoin price prediction for 2023
What does the bitcoin price prediction for 2023 look like? Several alternative digital currencies have been launched over the past few years that aim to build on the success of Bitcoin.
Many of these altcoins are called “superior” BTC in terms of speed and scalability.
In an objective sense, this appears to be true. Many consider Ethereum to be the best cryptocurrency to invest in as it uses blockchain technology in a more innovative way than Bitcoin.
Moreover, other networks are also beginning to move away from the Bitcoin “Proof of Work” (PoW) consensus to the “Proof of Stake” (PoS) algorithm, which is more scalable and environmentally friendly.
However, even though Bitcoin technology may be getting outdated, the currency is still increasingly being adopted around the world as a method of payment.
As reported by Reuters, approximately 25% of small businesses in nine leading countries intend to start accepting cryptocurrency as a form of payment in 2022. Given the proliferation of bitcoin, there is a good chance that BTC will be the currency of choice for these businesses.
Bitcoin ATMs have also become a popular concept, allowing users to deposit cash and buy BTC (or other cryptocurrencies) using a physical kiosk.
The purchased cryptocurrency is then sent to the user's crypto wallet via a QR code, providing a quick and easy way to purchase digital currencies.
According to reports, there are now more than 30,000 Bitcoin ATMs around the world.
This spread should help the coin continue to grow over time, which is why our 2023 Bitcoin price prediction estimates that the coin could be worth $69,000 at this point.
Disclaimer: The opinions and opinions expressed by the author should not be considered financial advice. We do not advise on financial products.
