The Bitcoin Investment
Have you heard of Bitcoin? There’s a good chance you have. But, while the cryptocurrency (and others like it) have been in circulation for the better part of a decade…for many they are still shrouded in mystery. Ever since its inception in 2009 Bitcoin has been the subject of controversy. It was designed as a better alternative to centralized fiat currency. Bitcoin is not the only cryptocurrency out there. But, as the first of its kind…it is often the only name we hear in the conversation.
There are many who decry Bitcoin (along with its alternatives like Monero and Etherium) as a bubble that’s set to burst at any moment. Yet, despite almost a decade of prognostications of doom from the banking industry people still continue to trade Bitcoin. Its fluctuations in value recently have seen it focused heavily in the financial news this year. Although, despite a sharp drop its value seems to be bouncing back in light of a recent consensus conference.
This is a contributed post and do not necessarily reflect the opinions of Meet The Harris Family.
While there are some who predict nothing but doom for the future of Bitcoin, it will continue to have value as long as people buy and sell it. And they most certainly are buying and selling. In fact, as people grow more accustomed to Bitcoin, enterprising individuals have begun to find new ways of using it to improve their family’s finances, start up their own enterprises or simply trade like they would any other stock or commodity. Here we’ll look at some ways in which Bitcoin could transform your family’s finances (for the better, obviously). But first well provide a little breakdown for the uninitiated…
What is Bitcoin and why do people like it so much?
Bitcoin is a cryptocurrency. This means that unlike other fiat currencies (which are tied to the economic fates of individual nation) they are completely decentralized. Essentially protecting them from economic recession and depression. Of course it also means that they may not necessarily boom along with the economy of any given country. Nonetheless, in an unstable and unpredictable economy where the next financial crisis could be just around the corner.Consequently, it’s understandable that many would find it appealing.
While Bitcoin is finite it can be mined if you’re prepared to invest in the right hardware and software (more on that later). However, unlike other currencies, we determine it’s value by reviewing its scarcity, utility, supply and demand. Not like other fiat currencies whose values are tied to the value of precious metals.
Many like to trade in Bitcoins because the blockchain technology on which they’re based makes them extremely secure. Because they are not centrally stored, they are virtually impossible to steal. Moreover, Bitcoin can be traded anonymously. And, because they are classified as a commodity rather than a currency they have certain tax advantages, too.
And now what ?
The caveats of mining
While many trade Bitcoin, a few choose to mine it. Some sites even facilitate getting Bitcoin with PayPal. Indeed the rush of tech savvy miners is not unlike the goldrush of the 19th century. But while anyone can become a Bitcoin miner in theory, in practice it takes a serious investment and some technological know how to do it well. The hardware required to mine Bitcoin also uses a tremendous amount of energy. Which means that turning a profit may be tricky. Never fear, though, there are still a lot of ways in which Bitcoin can rescue your family’s finances.
There are many ways in which you can trade in Bitcoin and profit from its rising value or build a small cloud based pot of the Cryptocurrency which you can use in a number of ways…
Invest to escape debt
There was once a thought that saving was the best way to escape household debt. But while this may have been true thirty years ago, times have most certainly changed. The savings accounts offered by most high street banks aren’t what they used to be. In fact, most high street banks have a such a low Annual Percentage Yield (averaging around 0.06%) that you’re unlikely to grow your money using them. An online savings account may offer a slightly higher yield since they have fewer overheads. However, saving should be just another tool in your arsenal when it comes to escaping debt.
Many money-minded individuals supplement their savings with a diverse stock portfolio. If you’re apprehensive about investing in Bitcoin, the best way to invest is by allocating a modest portion of your portfolio to Bitcoin. While no investment is without risk, the performance of any given public company does not have an impact on Bitcoin’s value. Thus, making it a potentially safer bet than the stock market or Forex.
