Bitcoin is a cryptocurrency and worldwide payment system. It is the first decentralized digital currency, as the system works without a central bank or single administrator. The network is peer-to-peer and transactions take place between users directly, without an intermediary. These transactions are verified by network nodes through the use of cryptography and recorded in a public distributed ledger called a blockchain. Bitcoin was invented by an unknown person or group of people under the name Satoshi Nakamoto and released as open-source software.
Historical Price Chart
2017 started with a bang as Bitcoin shot through the $1000 mark with no signs of slowing down. As a result I get about 2 emails a day from people around the world who are asking one very simple question: “Should I invest in Bitcoin?” Before we begin, I want to get something out of the way – Bitcoin is not a company or a stock, it’s a currency. If you still don’t understand what Bitcoin is, watch this video.
So when you want to invest in Bitcoin you are basically buying the currency. However, there are also some other forms of investing in Bitcoin. What does it mean to invest in Bitcoin? In order to answer this question the first thing you need to answer is what do you mean when you say you want to invest in Bitcoin. Do you want to buy the currency in hopes it will appreciate it value? Do you want to invest in Bitcoin related companies? Are you looking to day trade with Bitcoins? Buying and holding The most common form of “investing” in Bitcoin is buying the currency in hopes it will appreciate in value (also knowns as “hodling”, see the origins of the term here).
If this is the case then you need to decide for yourself if you think this is a good time to buy. Meaning, do you think the price will continue to rise.
Merchants accepting bitcoin ordinarily use the services of bitcoin payment service providers such as BitPay or Coinbase. When a customer pays in bitcoin, the payment service provider accepts the bitcoin on behalf of the merchant, converts it to the local currency, and sends the obtained amount to merchant's bank account, charging a fee for the service.
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