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When you think of trading or investing, you probably think of stocks and bonds. You might also think of commodities, currencies and whatnot. But strolling into a mutual fund manager's office and mentioning Bitcoins would probably get you an odd look, assuming he or she is not an avid reader of TechCrunch.
Introduced in 2009, the electronic currency Bitcoin is exchanged through its own payment network. The Bitcoin can be stored in a virtual wallet and has been described as a cryptocurrency; a decentralized, peer-to-peer currency which relies on cryptography to facilitate currency generation and transactions. To prevent double-spending, computers known as “miners” receive transaction fees and free Bitcoins in exchange for running a proof-of-work system.
If you're just looking on how to invest in Bitcoins,sign up with Coinbase and get started. By using THIS LINK you'll get $10 in bitcoins after you buy $100 in Bitcoins.
If you don't like this idea – check out Stockpile. You can buy fractional shares of Bitcoin using the fund GBTC. You get $5 for free by opening an account at Stockpile here.
https://www.stockpile.com
Now, if you're looking to become a Bitcoin millionaire, keep reading.
“Do You Take Bitcoins?”
The Bitcoin is essentially a speculative vehicle for geeks. Basically, do not eat out and expect to pay for the meal with Bitcoins. Not long ago you could have bought illicit drugs with the currency, but the FBI closed down “Silk Road” earlier this year, which allowed people to buy illegal substances anonymously.
Some legitimate vendors have taken to Bitcoin, allowing customers to purchase real products and services with the digital currency. Richard Branson of the Virgin Group has even decided to accept Bitcoins through his Virgin Galactic. Reddit allows you to use Bitcoin to buy Reddit Gold. Yes, you can't buy your everyday groceries with Bitcoins, but you can buy a trip to space. While some everyday vendors have looked into accepting Bitcoins too, most of the demand for the currency has been fueled by speculators, rather than early adopters.
If you're looking to use Bitcoin to pay for stuff, you need a Bitcoin wallet like Coinbase. It's a simple website/app that allows you to securely store your Bitcoins and sell them.
With so much volatility, using Bitcoins in everyday life would be extremely risky anyway. Buying a TV for $1,000 might have cost up to 10 Bitcoins last month and just one Bitcoin now. With such volatility, any serious commerce conducted with Bitcoins is likely to result in one party losing out on a lot of value. So right now, the cryptocurrency is realistically just a tool for speculation. Coinbase is one of the major Bitcoin exchanges, which allows you to buy and sell Bitcoins as you please. You sign up, deposit real-world money and exchange the currency with relatively low fees.
Bitcoin's Bullish History
First, let's take a look at the price history. According to Bitstamp, as of today the market capitalization is over $12B with over 12 million Bitcoins in the system. Until 2013, Bitcoins were trading for either less than $10 each or not much over. As soon as 2013 started, Bitcoins seemed to ever-increase in value until April 9 where they peaked at well over $200. By April 16, Bitcoins had lost almost half their value.
Since April, Bitcoins have made a ridiculous comeback. Bitstamp shows that the price of a Bitcoin didn't reach its previous peak until November this year. However, in this same month, Bitcoins surged up to well over $1,000 a piece. Right now, they seem to be fluctuating.Of course this is all speculative. You can make all the predictions you want, but no one knows what the future holds for Bitcoin. Is it just a fad or could Bitcoin genuinely develop into an everyday currency? If it really took off, would the government not just ban it completely? Only time will tell, but for now let's speculate.
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How To Make A Million With Bitcoins
You have two options: mine or trade. By mining for Bitcoins, as long as the markets remain active you can basically make money for nothing. But the problem is, mining is such a tough gig now that it is hardly worth it. Turning your computer into a miner will likely make it noisy and heat up.It would likely take you a long time to even mine a single Bitcoin, by which time you probably would have spent more on electricity. However, if you have access to some serious computing power and you don't have to pay the bills, you could make some easy money here.
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