Introduction To Bitcoin Investment
This is part of a series of posts on Bitcoin and cryptocurrency investments. The content here is just my views and perceptive of this concept. It shouldn’t be considered as guidelines for your investments as you may or may not lose your money. I might or might not make money with these concepts as these are pure experiments and observations not proven strategies or theories. That being said if you are new to bitcoins I would recommend reading my other posts on bitcoin from these links below before we get started with investing topics:
- 1.Introduction to the World of BitCoins
- How does Bitcoin work?
- Why should you use bitcoin?
- Limitations of Bitcoin
- How to use Bitcoins
I assume that you have the basic knowledge of how the bitcoin or the cryptocurrency systems work. By the way, last week I came across a cool blockchain-based website called steemit.com, it is a decentralized website, do check it out here. Coming back to our topic today let’s see how you can invest and before that what you should know before you start your bitcoin or cryptocurrency investing plan.
I can safely assume, you are keen on learning about investing in these currencies so you must have a torque cryptocurrency wallet to start with. By now, in case you haven’t got one already, check my post How to Choose the Right Crypto Wallet on wallets and grab one and a cup of coffee so that we can dive deep into it( Not the coffee just bitcoin investing).
I have been observing or rather reading papers and notes from very experienced investors and this led to mixed opinions and you can call it confusion or overwhelm. This post has been written with the assumption that I will be able to plot out the confusion and find clarity. At least we know what we are confused about which itself is better than nothing.
Cryptocurrencies are changing at a rapid rate and it does not perform or sometimes outperform according to the expectations of the investors, so let’s check the basic ideas I have gathered about investing in these new currencies.
Long term or short term ( When do I see the returns?)
When it comes to investing, any type of investing for that matter. there is this notion of a period of investment. There is the short-term investment and long-term investment. As with trading or investment in stocks the longer you invest the lesser you will be prone to the dangers of volatility and sudden fluctuation and changes in the value of these stocks. The fluctuations even out over a longer period of time, which means that long-term investments, over a period of time, could be a better option for beginners.
Safeguard your treasures (with something! a sword ? or a more defensive… vault?)
Even banks or money deposited in financial institutions are not safe today. You can read a small example here in my post about the Emergence of Bitcoin. Being a new investment or monetary system, there have been a lot of scams, attempts to hack and steal the money, the fact that the system is safe as explained here (Why should you use bitcoin?) is a concept but digital currencies has not been around for a long time to say that it has stood the test of time.
Since there is no centralized authority behind these technologies there is no system of precaution or backup system for transactions or currencies themselves. Once it is lost by any means or method in the future, it is gone forever as per my understanding today.