HOW TO GET INVOLVED IN BITCOIN AND OTHER CRYPTOCURRENCIES
This report is for anyone who wants a better understanding of cryptocurrencies and is struggling to understand how to invest in a simple way.
Bitcoin and other cryptocurrencies such as Ethereum, Ripple, Bitcoin Cash and Litecoin are making international headlines and are featuring in all the press.
Why? The main reason is the explosive growth in 2017 across most of the major cryptocurrencies. Stories of 1000% growth in under 12 months are commonplace for these assets. This growth has come about as these currencies are gaining exposure and becoming mainstream. You can now withdraw cash for Bitcoin at some ATM’s, and even buy property and art with Bitcoin!
The other obvious reason is that there is a finite amount of each cryptocurrency available. Therefore as demand increases (as it is) and with each being a finite resource, the price is going to go up just by simple supply and demand.
Talk of Bitcoin at $1,000,000 per coin by 2025 are pretty commonplace.
Here’s a chart of the Bitcoin price for the last few years to explain why there is such a massive demand to get involved.
Two important factors to bear in mind for the future price of Bitcoin (and all other cryptocurrencies) are as follows:
Firstly – cryptocurrencies are mined (more info below). The mining process is essentially a computer solving a very difficult mathematical problem known as the blockchain (again, more on this below). This mathematical problem is shared on every computer involved in that cryptocurrency. Importantly the solution to the problem has to be verified by EVERY SINGLE ONE OF THOSE COMPUTERS meaning security of the blockchain is essentially 100% safe. Why is this important? All cryptocurrencies are a finite resource therefore as more and more are mined, the mathematical problems required to mine them get bigger and bigger. Exponentially bigger! Therefore more and more computational power and cost is needed to mine it resulting in the price going up ($1,000,000 per Bitcoin perhaps).
Secondly, and more importantly, public awareness has only just started. Demand is only going to increase from here.
Why? Most people are becoming aware of Bitcoin, but almost no one knows actually how to buy or sell it. And for the other cryptocurrencies it’s even more difficult. Words like wallet, exchange, mining and blockchain make it appear incredibly complicated. And there’s a reason for this. It genuinely is complicated! Buying, selling, converting to other cryptocurrencies for speculation purposes and generally getting involved has many hurdles.
“I’ve been trying to buy Bitcoins since September and still can’t work out how to start or where to buy them from – HELP!” Tom Murray – Bitcoin forum 21/11/17
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Here is a snapshot of 5 of the main cryptocurrencies – referred to as crypto’s
Bitcoin – Bitcoin is the first successful internet money based on peer-to-peer technology; whereby no central bank or authority is involved in the transaction and production of the Bitcoin currency. Limited to 21,000,000 coins.
Ethereum – Ethereum is the first Turing-complete cryptocurrency that uses Ether as fuel to incentivise its network.
Litecoin – Litecoin is a peer-to-peer cryptocurrency. The transaction confirmation time taken for Litecoin is about 2.5 minutes on average (as compared to Bitcoin’s 10 minutes). The Litecoin network is scheduled to cap at 84 million currency units.
Ripple – Ripple is a real-time gross settlement system, currency exchange and remittance network by Ripple.
Bitcoin Cash – Bitcoin scalability debate led to the cryptocurrency split on August 1, 2017. A chain coming out of the split and setting its block size limit to eight megabytes to increase the number of transactions its ledger can process is called Bitcoin Cash.
So how do people buy these crypto’s?
If you want to own Bitcoins directly, the first step is to get a wallet. A wallet will store the information that relates to your Bitcoins.
While you can keep your wallet on your own hard drive, it’s a lot easier to store your wallet online. There are loads of different places to register for an online wallet, but two of the biggest providers are Blockchain.info and Coinbase.com.
Part of acquiring your wallet is setting up security measures that allow you to access it in the future and make sure no one else can. It’s not much different from online banking with the usual two-step authentication process.
Once you’ve got a wallet, you’re ready to buy a Bitcoin.
One thing to note, you don’t have to buy whole Bitcoins. Like other currencies they have smaller units.
There are loads of brokers that sell Bitcoins. This is who you will send your money too, so it’s an important decision. The website Bitty. bot allows you to compare brokers on price and trust rating.
Because this step involves real money, it will often involve “Know Your Customer” requirements that include identity checks.
You can also trade Bitcoin on exchanges such as Coinfloor, Coinsbank and Kraken in the UK. These are also listed on Bitty.bot.
Ethereum follows a similar route.
However outside of those 2 it can get even more confusing as the typical method is to use Bitcoin to buy other crypto’s, and when it comes to altcoins and ico’s you also need to check that your digital wallet can store them! That’s like the wallet in your pocket being restricted from containing Euro’s!
How do you decide which cryptocurrencies to buy?
Bitcoin has been in decline since it’s $20k peak. So how do you know which crypto’s are making the 30% intra day gains and which ones are making the 30% intra day losses? Extreme volatility can be your friend, but equally it can be camped on the other side of the fence too.
Here at 10x Growth Account we have a team of experienced, professional UK traders backed up by an international team of qualified analysts. We analyse price patterns, trade volume, news and sentiment to help our decision making process when moving in the crypto markets.