What is Bitcoin?
Bitcoin is perhaps the best known of a group of digital currencies known as cryptocurrencies. These are decentralised stateless digital currencies created by computers without the involvement of governments or banks. Bitcoin and Ethereum are the most popular.
The origin of Bitcoin remains a mystery. It is believed to have been created by an anonymous coder known as Satoshi Nakamoto who has never been identified though some believe the name applies to a group of coders. The underlying technology is known as blockchain. Bitcoin debuted in January 2009.
Cryptocurrencies are viewed by many as the future of digital payments, described as "a peer-to -peer version of electronic cash that would allow online payments to be sent directly from one party to another without going through a financial institution". Some companies and individuals are accepting Bitcoin for payment.
Some have likened Bitcoin to a commodity, a form of "digital gold."
Bitcoins are created by a process called "mining." There are about 16.7m in circulation out of a total of 21m. An estimated 3.7m bitcoins are estimated to be permanently lost due to forgotten or missing passwords.
The myriads of cryptocurrencies would probably disappear with Bitcoin projected to be the strongest survivor.
Blockchain
Blockchain is a cryptographic decentralised public ledger that tracts credits and debits.Verified transactions are presented chains in a sequence of blocks using complex mathematical functions.
Blockchain is already transforming major industries especially financial services in areas such as data integrity, record keeping and financial contracts. Some commentators are predicting that blockchain will be bigger than the internet.
What is the value of Bitcoin?
The value of bitcoin varies from those who believe it is a scam that should be banned and therefore worthless to those predicting it will go to £40,000 dollars by the end of 2018.
Bitcoin is extremely volatile with wild swings in prices and so not for the faint hearted. You should certainly not commit any money you cannot afford to lose.
The current boom in bitcoins has been compared by some to stock market manias and bubbles destined to crash like the dotcom bubble of 2000 as people pile in driven by the fear of missing out.
How Do You Store Bitcoin?
A bitcoin is a string of computer code - a key consisting of a string of numbers and letters that looks like this 01QT23qtqt4q5qt678QT9qt
You need to download a bitcoin digital wallet to store your private keys.To avoid hacking and theft you should save your wallet outside the internet, known as "cold storage."
Some companies offer a free bitcoin wallet download service without trading bitcoin. Others provide an integrated service.
Where do you buy bitcoin?
The easiest way to buy bitcoin is from an online exchange.
Coinbase is the leading and most popular US bitcoin brokerage with more than 30 million wallets. Not all countries are supported. You can buy bitcoins, ethereum and litecoin from
Coinbase and also get a wallet.
Other exchanges include Gemini (owned by the Winklevoss twins), Bitfinex, Bitstamp, BTCC, itBit, Kraken and OKcoin.
You can sell your bitcoin through any exchange.
The
CoinDesk bitcoin price index tracks prices from digital currency exchanges Bitstamp, Coinbase, itBit and Bitfinex.
FX brokers offer trading in the digital currency with both spread betting and CFDs. Traders do not need a Bitcoin wallet to trade Bitcoin markets as they are simply speculating on the price movement of Bitcoin and so don’t need to own any.
Popular online brokers include Etoro and Avatrade.
Bitcoin futures started trading on the Chicago Cboe on 11th December to be followed by the Chicago Mercantile Exchange. Some believe this gives legitimacy to bitcoin.
You can invest indirectly through funds that track the value of bitcoin.
In future you will be able to make money when the price falls by "short selling." It would also be possible to invest in cryptocurrencies through index funds and ETFs.
Bitcoin is very volatile and so you need a disciplined approach to your trading with a strategy in place to reduce your downside risk.
Join a Club
Join a group if you are interested in trading bitcoins.
Crypto808 Club is building the largest group of cryptocurrency enthusiasts to share and learn strategies to trade bitcoin and other cryptocurrencies. Membership is FREE for a limited period.
Link
http://smartlongterminvestor.com/2017/12/12/trade-bitcoin/
