Complete Guide to Bitcoins for Beginners & its Associated Risks
Some call it “digital gold,” while others simply say it is the “reinvention of money” and many analysts say that it is the starting of the biggest financial bubble in history.
The bitcoin is much more than a virtual currency; cryptocurrency is the fastest growing worldwide; which has risen to 1,200% in just one year.
An investment of US $ 10,000 in bitcoins seven years ago is now worth ten times more: the US $ 1,100 million.
Its value started to skyrocket in 2013, after the “corralito of Cyprus,” during which the offices and bank deposits were closed and the bitcoin became a “haven”, as it was gold at the time.
This week it made history on Wednesday and reached the US $ 11,500… Although hours later plummeted to 20%.
Unlike conventional currencies, bitcoins are not regulated by governments, large banks or investment funds, but by private investors.
You can access them from anywhere in the world with an internet connection through exchange firms or sell products or services for them. Have “life” out of network: are exchanged for real goods and services, and even for cash.
However, few know how and where to invest.
How and Where to buy bitcoins?
There are several pages where you can buy bitcoins. They are platforms that feature a large user base, and you can pay with your credit card or bank transfer:
Coinbase (https://www.coinbase.com/): provides a commission of 3.5%, but is one of the most popular sites.
* Kraken (https://www.kraken.com/): the commission is much lower, between 0.16 and 0.26%.
LocalBitcoins (https://localbitcoins.com/): it is designed in buying from person to person (P2P).
The process is fairly simple.
To use them, you must first sign up for your details and create your account. Once confirmed and verified in some cases this last step may take a little, you need to attach the card you want to pay and click the “Buy.”
Where to spend bitcoins?
You can pay with this currency on different websites.
For example, Bitcoin Tree is a website that offers collaborative systems, Bitcoinisimo is a kind of “Amazon” of bitcoin with
shipping worldwide and L3Server offers virtual private servers (VPN).
In each country, there are specific websites that sell all kinds of products you can buy with bitcoin.
A website has created a list of some of the options that exist in Latin America and Spain:
WORD OF CAUTION: There are NO physical stores worldwide that accept payment with bitcoin.
Currently, the website CoinMap, a map of open collaboration, has 10,805 registered businesses.
Only in Mexico City more than 30, in Bogota other 40, Santiago de Chile has 15 and Buenos Aires over 150.
How to use a virtual wallet?
The virtual wallet is access to a unique key that allows access to the bitcoin you bought.
They are available on the user’s personal computer or online services that facilitate the buying and selling with bitcoin.
Each person can have as many portfolios (or “wallets” in English) as you like and do not need to install them. Each is associated with a bank account, and this operation is done through an exchange. This website tells what the most recommended are:
And mining bitcoins?
In any monetary system, governments print more money whenever they need it, but that does not happen with bitcoin.
The cryptocurrency not a coined currency. The system works through computers worldwide that make transactions for that to happen.
As a reward, “bitcoin miners’ get coins in return. Your job is to improve the efficiency of bitcoin and create “blocks” or chains in which those transactions are listed.
To do this, you need to have certain skills and be quick to solve mathematical problems. It is the most challenging option to obtain bitcoin.
What are the risks of investing in bitcoins?
Some analysts say the rapid growth of bitcoin is not a long-term guarantee that cannot fail; Moreover, the price could plummet with just one click.
“You could create a leak if a large investor withdraws, ” said the expert trader Kevin Zhou.
Others argue that it is a fraud, as was the case of pyramid schemes. On the other hand, we must bear in mind that the lack of regulation free market which enables transactions to be carried out very easily, but it is also riskier.
Watch Videos in Spanish, Hindi and Chinese to know more about bitcoin.
Spanish: ¿Qué es Bitcoin? Y las monedas virtuales (en Español)
Hindi: क्या है ? जानिए बिटकॉइन की पूरी जानकारी
Chinese: 什麼是比特幣 Bitcoin (BTC)?