Bitcoin is a digital currency. In reality, you have to balance a range of factors including convenience, security and transaction costs. But if you are investing, does bitcoin have an intrinsic value, like gold?
Why Invest in Bitcoin?
The price of a bitcoin may increase because, for example, it is attractive to technology enthusiasts, and because we are all reading stories about how people made — or failed to make — fortunes. But, like tulip bulbs, bitcoins could be worthless when the bubble bursts. There is a finite supply. There is no intrinsic value. If anybody is persuading you that it should somehow be related to some GDP or gold … put down the Kool-Aid and back away. However, banknotes are backed by governments that have a strong interest in keeping their value relatively stable.
In the beginning, the best way to make money from bitcoins was to mine them with a home PC. However, bitcoin mining becomes more difficult the more miners there are.
The Bitcoin Investment Trust
Coins are not pure profit because of the cost of the hardware and the electricity consumed when mining. However, there must be dozens of digital currencies besides bitcoin, and the CoinChoose website lists a Top Well known alternatives include Ethereum, Litecoin, Dogecoin and Bytecoin.
You might find one that is still worth mining, or that might represent a better gamble than bitcoin. CryptoCompare is another useful website. It favours individuals, not mining pools. For example, speculation about the Chinese Yuan devaluating has, in the past, caused more demand from China, which also pulled up the exchange rate on U. How to Invest in Bitcoins and Where to Buy The difficulty of buying bitcoins depends on your country.
Developed countries have more options and more liquidity. You can use our exchange finder to find a place to buy bitcoins in your country. Find a Bitcoin Exchange How to Secure Bitcoins As with anything valuable, hackers, thieves, and scammers will all be after your bitcoins, so securing your bitcoins is necessary.
Ledger Nano S — Ledger is a Bitcoin security company that offers a wide range of secure Bitcoin storage devices. Read more about the Ledger Nano or buy one. It generates your Bitcoin private keys offline. Bitcoins should only be kept in wallets that you control.