What to Expect Before Buying Bitcoin
Buying and learning about Bitcoin (BTC) can feel like a lot at times. After all, Bitcoin was only created a little over a decade ago and there’s a lot to look into when you first start your trading journey. From questions about where to get BTC to how to buy it, the world of crypto can be overwhelming but if you’re open to learning a few things, buying BTC can be a lot easier than you think. You can even convert BTC to cash with a few exchanges—which we’ll cover below. Interested in learning more about the ins and outs of BTC? Let’s dive into what you can expect.
You will need to do your research
This is rule number one for just about anything in life, and it’s crucial for Bitcoin: always do your research. It’s critical to look at things like fees, conversion rates, which exchanges take what crypto, and most importantly, what the price of BTC is. By completing your research on it, you can learn a lot about trading mistakes to avoid and which exchange is best for you.
You should understand the basics first
Just like we mentioned before, doing your research when buying BTC is so important. However, what’s also important is understanding what it is and how it works. Ideally, you should look into the basics of Bitcoin before buying. This way, you can expect what to do when you first start buying.
Another good way to understand Bitcoin is to dig into some information about the blockchain—otherwise known as BTC’s system. This can get a little complicated at times, so the more research you do, the easier it’ll be when you start trading. Good places to start looking for these answers are crypto news sites and finance websites. They’ll break down what BTC is in an easy way and from there, you can keep exploring.
You will hear the word decentralized a lot
While you complete your research, something you may read a lot about is that Bitcoin is decentralized. This just means that there are no intermediaries that control it, like banks or the government.
Another common fact is that Bitcoin is untraceable. While this is partially true, this is also somewhat a common misconception. For the most part, BTC is pseudonymous and untraceable, meaning that you can’t necessarily trace it back to a user. However, while you can’t trace it back to a specific person and their real-world identity, you can trace it back to their wallet address—the address used to send out BTC.
That doesn’t necessarily mean BTC is unsafe or a threat, it just means that it’s somewhat traceable. This shouldn’t matter too much for most people, but it’s something to keep note of when doing your research.
You may experience FOMO
Over the last few years, you may have heard the word “FOMO” thrown around a lot. FOMO just stands for “Fear Of Missing Out.” It’s an emotion investors have when they worry they may miss out on a good crypto deal. For example, if there’s a dip in Bitcoin prices and many people start buying into it, someone experiencing FOMO may buy BTC just so they don’t miss out on this opportunity. As a general rule of thumb, it’s wise to stay away from investment decisions made through emotions. Always go with facts over fear and don’t let the fear of missing out guide your choices.
You may be tempted to over-invest
This might sound like a no-brainer, but it’s important not to over-invest with more than you have. Some people might feel that they’ll get their money back two-fold with BTC, but many financial experts agree that you should only invest in crypto with what you have on hand. Just like with anything in the finance world, you never know what will happen. So ensuring that you’re investing the right amount for you is incredibly important.
You should learn where to buy crypto
Once you’ve done all your research on Bitcoin and learned about good investing habits—such as avoiding FOMO and not over-investing—let’s get into what you can expect when you start buying crypto. First things first, you’ll need a place to buy Bitcoin. There are a handful of exchanges you can go to trade for it. The platforms allow users to trade with various payment methods such as cash, credit, or checks, for BTC. On top of that, most exchanges will even give you a BTC wallet for free where you can hold onto your crypto. An example of an exchange is Paxful, where you can trade with over 350 payment methods.
Starting your BTC journey
Whether you’re just getting started or have done deep research, being more aware of what to expect when buying Bitcoin never hurts anyone. As you continue to look more into BTC, keep these tips in mind and always be diligent before starting your investment journey. And always, remember to have fun with it. Bitcoin is not only an investment, it’s an adventure!
*The content of this article is for informational purposes only. You should not construe any such information or other material as legal, tax, investment, financial, or other advice.