Are you finally ready to invest in cryptocurrency? All your friends and coworkers are always talking about Bitcoin and other cryptocurrencies and how the value is constantly rising.
But you are sitting out by yourself, with an empty crypto wallet, wondering where to even begin. It can be overwhelming to get started with cryptocurrency.
There are tons of different coins available, different places to buy them, and different ways to store them. For the beginner, it can be tough. But luckily, we put together this bitcoin for beginners cryptocurrency guide to explain it all in plain English.
Ready to learn what cryptocurrency actually is, and how to buy bitcoin for the first time? Then keep reading to finally get started.
What Is Blockchain?
To start talking about bitcoin, we first have to talk about cryptocurrency in general. And in order to do that, we have to talk about blockchain, which makes it all possible.
At its core, blockchain is a database. That means it’s a vessel for storing information. Information is stored electronically via high-tech computer technology.
These computers use tons of power in order to store massive databases that can be accessed and edited by many people at the same time. But what separates blockchain from other types of databases is how information is stored.
As new information comes in, it is all stored together in a group, called a block. Once the block is full, it’s chained to the previous block, and a new block begins collecting information.
So all the data that comes into the blockchain is ultimately stored in chronological order. Once the block is chained, it is complete and cannot be changed or added to. Its records will remain intact. This helps to create a decentralized, permanent database.
In the case of cryptocurrency, each currency will have its own blockchain. The chain will log all transactions of that particular currency, providing permanent records.
What Is Cryptocurrency?
Now we know that blockchain makes cryptocurrency possible, thanks to it acting as a permanent record of all transactions. But what is cryptocurrency?
It’s a digital currency that is decentralized in nature. That is, it doesn’t belong to any one country or geographic location. Because of this, it is outside the realm of government control or devaluation.
Cryptocurrency is secured by cryptography, meaning that it is basically impossible to counterfeit crypto, unlike paper money which is easily counterfeited.
When you buy cryptocurrency, it essentially acts as a virtual token in your wallet. You can keep it, spend it, or give it away however you please. Every transaction is recorded on the blockchain.
More and more online and brick-and-mortar vendors are allowing users to purchase with cryptocurrency. We can expect to see a rise in the everyday use of cryptocurrencies over the next few years.
So what is Bitcoin? Bitcoin was the first cryptocurrency to use blockchain. It was launched in 2009 by an unknown individual or group called Satoshi Nakamoto.
To this day, little is known about this person or group. But it’s estimated that they created the original software and mined up to a million bitcoin in the early days before moving on as the bitcoin originator.
In the first few years, the value of Bitcoin fluctuated greatly as individuals discussed its potential value on forums. At the beginning of 2021, the value of one Bitcoin was around $30,000.
Today, Bitcoin currently represents the majority of all cryptocurrencies in circulation. And even though there are many other growing currencies, Bitcoin remains the most valuable and most popular.
Many people have complained about the effects of cryptocurrencies such as bitcoin and the environment. They argue that these currencies are wasting precious energy and harming the environment. But upon diving deeper, we find that it isn’t the case.
Bitcoin holds real value, not only to those who currently hold it in their portfolio but to all who value an economically free society in the future.
Bitcoin for Beginners; How to Buy Bitcoin
The value of Bitcoin is always fluctuating. But here’s what you need to know; 10 years ago, you could’ve bought an entire Bitcoin for one dollar. If you did that, you could sell it today for over $50,000.
Of course, the value could change tomorrow, or next month, so don’t get caught up in the exact amount. The point is, the value of Bitcoin is insane and always growing.
So yes, the best time to buy Bitcoin was 10 years ago. The next best time? Today, of course.
But if you’re new to it all, you might be wondering where to start. Follow these steps.
Get a Wallet
When buying Bitcoin, you’re going to need a place to store it. This can be a virtual wallet or storage device. It is like a virtual checking account.
You can download apps on your phone designed to function as a cryptocurrency wallet. These work well for users storing smaller amounts of currency. Plus, they are often free to download and use.
For those doing some serious investing, it’s best to use a heavier storage device, stored on your computer or dedicated external storage device.
Choose a Bitcoin Exchange
Once you have your wallet, you can determine where you are going to purchase your Bitcoin. There are many marketplaces available.
Some function as brokers, where they facilitate the transaction for you for a fee. It’s the easiest and quickest way to get started but is the most expensive.
There are some marketplaces that allow you to purchase directly from individuals for a smaller fee. And there are some platforms that connect you virtually or in-person with sellers to buy directly, often with little or no fee attached.
Buy at the Right Time
And lastly, it’s important to buy at the right time. Or, more importantly, don’t buy at the wrong time.
This topic is debated, but it’s generally best not to buy right when you hear the value is going up. The best time is when the price is at rock bottom, knowing it’s going to bounce back up.
Many people debate over the specifics, but it’s generally best not to buy right when you hear the value is going up. The best time is when the price is at rock bottom, knowing it’s going to bounce back up.
Getting the Best Education
Hopefully, you learned enough to get started with our Bitcoin for beginners guide. Sure, you can spend hours, weeks, and even months researching.
But the best way to learn is to dive in and get started. That doesn’t mean pour your lifesaving into Bitcoin, but you can start investing small amounts, tracking the value as you go. This will give you a hands-on education.
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