Investing in Bitcoin
Bitcoin as an investment Alternative
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| Pixabay: Bitcoin |
Lately, I was considering for expanding my
portfolio of investments. I was looking for the alternatives. This is when, I
encountered Bitcoins as an option. Now, Bitcoin seems to be a very unstable and
uncertain proposition. However, they have of late gained lot of traction, as in
couple of years their worth is greater than ever before. They provide
extraordinary profit on investments. Bitcoins are decentralized and
non-regularized virtual or Digital form of currency.
This blog is not only about Bitcoins but about
the certain facets of dealing with digital currencies and investing in them.
During my learning of digital currencies. I come across 3 imperative lingo of
them.
1. Bitcoin Wallets
Wallet are the
container of the digital currency. Wallet is a
public address or more technically are Hexadecimal code connected with the
account, which ascertains your inimitable identity. You can share this public
address of your wallet to take delivery of your bitcoins. Wallets comes in
different shapes and sizes
a) Online - benefits
in retaining the virtual currency on service provider maintained account. Big advantage
is that, they can under no circumstances be misplaced and fewer chance of loss
due to hardware crash or stolen and is always accessible online.
b) Offline –
wallet stores the Bitcoin in your private digital location. This is done for
one rudimentary intention that if you don’t trust online services or network, putting
away personally seems to be a good notion.
c) Hardware – wallets
are tangible hardware or every so often looks like pen drive or credit card,
holds the Bitcoin. They are benign from network frauds, scams and cons but are
vulnerable & exposed to physical loss or theft.
d) Software –
as name suggest software wallets are computer programs which actually stores
the Bitcoins in your digital device. Be it phone, tablet or personal computer
Beware that there are lots and lots of fake
wallet service providers who can rip-off your Bitcoins and you will never be
able to reclaim them back as there are no governing authorities and all
transactions are anonymous and cannot be traced back.
2. Bitcoin Exchanges
Exchange is identical to the real world
stock exchange which act as an arbitrator between 2 willing parties for trading
in this case, Bitcoins. Today’s exchanges play diverse roles like one can use
these exchanges for purchasing and selling of Bitcoins. These exchanges have, algorithms
or code running in the background which regulate the buying and selling price
of Bitcoins. There are many exchanges available in the market. The one which I
personally use is ZebPay. More can be read about ZebPay here.
My Referral : Get bitcoins
worth ₹100 free on your first bitcoin buy or sell with
referral code 'REF03765313'. Download the app: http://link.zebpay.com/ref/REF03765313
3. Mining
Mining of
Bitcoins is a term used for finding the fresh Bitcoins out by substantiating
the transactions done by others on the network. As a result, in doing so, some
of the processing power and resources are consumed. In lieu of this the miner
is rewarded with some of the blockchain which is sequence of Bitcoins as a remuneration.
Mining can be of two types, cloud mining and individual mining.
a) Individual
mining is done by a person by purchasing a specialized hardware called ASIC.
b) For cloud mining group of people collaborate together to join their mining
power and lease the resource to the interested individuals, who want to mine
the Bitcoins but cannot sustain the resources like electricity, cooling etc.
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| Pixabay: Bitcoin |
Bitcoin Potential
Based on this core principle, there will only
be 2 crores 10 lacs Bitcoins can ever be mined. And if lost, they cannot be
recovered ever. That's why due to Limited supply and heavy demand, Bitcoin
price is soaring high. Recently, in the month of February 2017, it reaches its
all-time high after 2013, so there is no saying that it will touch new limits
each and every year. The present predictions for 2017 is, in promising circumstances,
it is anticipated to touch $2,000 to $3,000.
In some way Bitcoin can be a
very good prospect to invest in but again I want to say that never assume, do
your research, always branch out your portfolio and never invest more than what
you can bear as a loss…
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