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How and why you should buy Bitcoin in 2020

Here’s everything you need to know.

bitcoin cryptocurrency on table
Image: Unsplash

As the world’s most popular cryptocurrency, Bitcoin has been frequently in the news. Though Bitcoin prices have sometimes been volatile, experts are bullish on the currency’s 2020 trends.

Factors That Affect Bitcoin Prices

Supply and demand are the main determinants of Bitcoin price. Other factors affecting price include the cost of mining Bitcoin, the rewards offered to Bitcoin miners, the performance of other competing cryptocurrencies, the exchange it is being sold on, and internal and government regulations.

Bitcoin Price Trends

The first Bitcoin market began operating in 2010, selling Bitcoins for just $.003 each. By February of 2013, some of the larger Bitcoin exchanges were reporting over $1 million in Bitcoin sales per month at an average price of $22 per Bitcoin. Later in 2013, the price would hit a high of $266 before falling below the $100 mark. However, the price rebounded towards the end of the year, surpassing the $1,000 mark on some exchanges.

Market volatility saw prices drop precipitously in 2014-2016, but rebound in 2017, eventually soaring to just under the $20,000 mark. However, the market would see another downturn, bringing the price into the $3,000 range by the end of 2018.

Renewed interest has driven prices up to the $10,000 range on some exchanges in 2020 with many market experts predicting a continued bullish market throughout the end of the year. While market volatility has caused significant fluctuations in value over the past decade, the trend has generally been upwards and that is expected to continue, making Bitcoin a promising investment.

Choose a Bitcoin Wallet

Your digital wallet is where you will store your Bitcoin until you are ready to spend or sell it. When choosing a wallet, you will want to select one that is secure, easy to use, and compatible with the Bitcoin exchange you plan to use. It can be a good idea to have more than one wallet so that you can still access your Bitcoin if a site goes down or closes. Digital wallets to consider include Exodus, Mycelium, and Bitcoin core, but there are many other options to choose from. Once you have accumulated a substantial amount of Bitcoin, you may want to store it in an offline cold storage wallet for added security.

Choose a Bitcoin Exchange

Bitcoin exchanges, such as NordikCoin, are where you buy and sell Bitcoins. When choosing an exchange, you will want to select one run by a reputable company, such as OmniMatrix. It is particularly important to choose a site that offers strong protection for your payment and other personal information.

Another factor to consider is the limits imposed by the exchange. If you intend to purchase large amounts of Bitcoin, you will need to choose an exchange with high enough limits to accommodate your planned purchase.

Speed is also important. If you need quick access to your Bitcoin, you may want to choose an exchange that offers Bitcoin ATMs in your local area.

Different exchanges offer different exchange rates for Bitcoin. You will want to compare the exchange rate offered by the Bitcoin exchange you are considering to the average international rate to make sure you are being offered a competitive price.

Finally, you will want to consider fees and payment methods. Most exchanges charge fees for deposits, withdrawals, and transactions. Additionally, not all exchanges accept all forms of payment, so you need to make sure the exchange accepts the forms of payment you intend to use.

Choose a Payment Method

Payment methods commonly accepted by Bitcoin exchanges include bank account transfer, credit and debit cards, and sometimes Paypal. The various payment methods take different lengths of time and some exchanges place different spending limits on different methods. Select exchanges offer Bitcoin ATMs where users can exchange their Bitcoins for cash.

Credit or debit cards are a fast method, but the fees can sometimes be high. Because they are the most commonly used form of payment, most exchanges accept them. Bank transfers usually have the lowest fees, making them a good choice for large purchases; however, they can take up to five days to complete. Cash is usually the fastest and most expensive method.

Whichever payment method you choose, you should be wary of scammers. Verify the site you are using is reputable and find out how they protect your personal and payment information. If you are planning to use cash in person, rather than at an ATM, be extra cautious that everything is on the up and up. You do not want to get robbed.

Buy Some Bitcoin

You have your wallet. You have chosen your exchange and decided on how you want to pay. Now you are ready to purchase some Bitcoin and store it in your wallet. The exchange you are using should provide you with specific instructions, but the process is fairly similar across exchanges.

You will need to input the amount of Bitcoin you wish to purchase and then press the buy button. This will usually result in a purchase at current market value, though there may also be an option to input your desired purchase price and have the trade occur when the price reaches that level.

Once you have made your purchase, the Bitcoin usually goes into the exchange’s wallet, where you can transfer it to your digital wallet for a fee.

That’s it! You are now the proud owner of some Bitcoin. At this point, you can either hang on to your Bitcoin and sell it when the moment seems right or go out and spend it.

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Chris has been blogging since the early days of the internet. He primarily focuses on topics related to tech, business, marketing, and pretty much anything else that revolves around tech. When he's not writing, you can find him noodling around on a guitar or cooking up a mean storm for friends and family.

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