How to Invest in Bitcoin: Trade Like a Pro Even if You’re a Novice
An Introduction to Bitcoin Investing
It might have been the cryptocurrency that took the world by storm in 2017, but Bitcoin has been around a lot longer than that. Created in 2009, the leading crypto now has a market cap of more than $138 billion and that means the price of Bitcoin has hit the five-figure mark in recent times. Today, even though the value has dropped from its 2017 peak, BTC remains a strong asset. In fact, when you compare Bitcoin prices to altcoins such as Ripple (XRP) and Ethereum (ETH), BTC remains the most stable investment for novice traders.
With this in mind, we’ve broken down the basics of not only how to buy Bitcoin but also how to truly invest in Bitcoin. To do that, you need to know how to enter the market in a simple and affordable way. Basically, if you’ve ever asked yourself “should I invest in Bitcoin?”, this guide is for you.
What Does Investing in Bitcoin Mean?
A Bitcoin investment is the same as any other financial trade. In other words, you buy into the market at one price in the hope you can cash out at a better price. While that’s true at a basic level, the way the industry has evolved means there are actually two ways to join the market:
Whenever someone asks us how to invest in Bitcoin, the standard answer is always: via exchanges. When you scroll through our list of recommended crypto exchanges, there are plenty of platforms that allow you to purchase BTC in the same way you would a fiat currency. For example, if you read our Binance review, you’ll see that this platform gives you the option to buy coins using crypto i.e. you can create an account, load it up with ETH and then purchase BTC.
That, in simple terms, it how to invest in Bitcoin via an exchange. The thing to remember when you make a Bitcoin investment using these sites is that you’re purchasing the underlying asset (actual coins), so you can only make money if its value increases.
Bitcoin Trading Sites
If you want to know how to invest in Bitcoin and make money whichever way the market moves, you need to use a traditional trading site. For example, if you read our eToro review, you’ll see that you can speculate on the price of Bitcoin increasing and/or decreasing. In technical terms, these are known as buy and sell orders. The reason this is possible is that you aren’t buying the underlying asset.
Instead, what you’re doing is investing in BTC using something known as a contract for difference (CFD). Without going too far into the specifics, that means you are speculating on the price of BTC instead of buying coins (something you do via an exchange). For novices, this system is perfect for two reasons. Firstly, you have the ability to make money if the price increases or decreases. Secondly, the eToro website has used this model to offer social trading. This means you can follow someone in the same way you would on social media, and the software will copy their trades. Essentially, this allows you to make a Bitcoin investment like a pro, even if you’re a complete newbie.
How to get Started with Bitcoin Investment
Should I invest in Bitcoin? If you want to answer that question correctly, you need to first decide how you want to play the market. If you’re happy with buying the underlying asset, you should use an exchange. However, if you want the flexibility of CFD and social trading, you need to use a trading site. Whichever option you choose, you’ll need the following things to make a Bitcoin investment:
A Starting Bankroll: Every trader needs a sum of money they can use to make investments. This money should be enough to get you into the action but also not so much that you can’t afford to absorb a loss. As a general guide, you will need to deposit at least £100 if you want to make a Bitcoin investment at eToro.
A Trading Platform: Learning how to invest in Bitcoin is just one of the things you need to do if you want to make some money as the price of BTC changes. To trade with confidence, you need a platform that’s secure and easy to use. When you use our eToro sign-up link, you’ll be able to join a platform that’s designed for novices and regulated by the FCA and CySEC. These features make the investment process simple, safe and slick.
A Bitcoin Wallet: For those using crypto exchanges, a Bitcoin wallet is an essential piece of kit. If you read through our Bitcoin wallet guide, we list some of the leading online and offline storage solutions such as Trezor. For those using a trading platform like eToro, a wallet isn’t necessary. Because you’re not buying coins, you don’t need to store them anywhere. Instead, your investment is held by the site and the money is released into your account once you’ve completed a trade.
A Wealth of Information: The key to making money from any Bitcoin investment is information. Reading the latest Bitcoin headlines, reviewing the price of Bitcoin and taking advice from experts is the only way you can get a handle on how the market is going to move. In addition to these provisions, the social trading options at eToro are a great way to stay ahead of the game. Because you can review the profiles of experienced traders and then copy each move they make, it’s possible to accelerate your earning potential with a fairly limited amount of knowledge and experience.
Where to Invest in Bitcoin?
Now you know how to invest in Bitcoin like a pro, the next step is to join a reputable trading platform. As we’ve already said, there are two main ways to invest in the market. If you’re slightly more experienced or simply want to own some Bitcoins, you can look through our list of top-rated Bitcoin exchanges and make a purchase. If, however, you’d prefer a more flexible solution, we’d suggest using eToro.
Before making any Bitcoin investment via eToro, take a look at our review. By reading through our overview of eToro, you’ll get an insight into how it works and the features it offers. What’s more, we’ve also taken the time to explain how eToro is regulated by two financial authorities. That’s something you won’t get with a Bitcoin exchange such as Binance. Even though these new platforms as safe, they aren’t overseen by an established regulator.
For the sceptics that are asking “should I invest in Bitcoin?” and “will my Bitcoin investment be safe?”, the main benefit of using eToro is that your funds are protected. Indeed, just as professional traders speculating on forex or gold are able to invest in confidence, eToro offers the same peace of mind when it comes to cryptocurrencies. For this reason alone, eToro is our go-to choice for investing in Bitcoin.
Investing in Bitcoin: A Step by Step Guide to Using eToro
To make a Bitcoin investment via eToro, you need to complete a few simple moves:
– Before you create an account at eToro, make sure it’s for you by reading our review.
– Once you’re happy, follow our eToro registration link (by clicking “buy now”) to load up the homepage.
– Input your details, including: name, username, email address, password and phone number.- Verify your account via the link sent to you via email.
Making a Deposit
– Log in to your account.- Use the “deposit funds” option on the left of the page to add money to your account.
– Select your desired payment method. The minimum deposit is £100 and eToro allows you to use secure payment options such as Visa, MasterCard, Skrill, Neteller and PayPal.- Enter the amount you want to deposit and confirm the transaction. The funds should be available to use instantly.
Executing a Trade
– Once you have money in your account, use the search bar at the top of the page to type in “Bitcoin” or “BTC”.- Click on relevant option to load up the Bitcoin hub. Here you’ll get to see news feeds, live statistics and Bitcoin price charts.
– When you’re ready to make an investment, hit the “trade” button.- If you believe the price of Bitcoin is going to increase, choose the “buy” option. If you feel like it’s going to decrease, choose “sell”.
– Input the amount you want to invest and select “open trade”.- Your Bitcoin investment is now active and will remain open until you decide to close it.
How to Invest in Bitcoin in Your Country?
Businesses have found different ways of doing things in different regions. To ensure you know how to invest in Bitcoin in your country, you need to know about any relevant rules and regulations. To give you an insight into the latest conditions governing Bitcoin investments in your country, check out the list of links below:
Should I Invest in Bitcoin? The Options Are All There
Investing in Bitcoin can be a simple process if you know what you’re doing. Exchanges will always be a solid option for experienced traders. However, the industry has boomed over the last year or so and that means more novices are now looking for a way to jump on the bandwagon and make some money. Broker exchanges such as eToro have found a way to cater to this niche while staying true to their roots. Today, through a combination of user-friendly software, social trading and direct access to active Bitcoin markets, virtually anyone can become part of the cryptocurrency movement. What’s more, if you use eToro, there are plenty of tools to help you make better decisions and, potentially, bigger profits.