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Important Things You Should Know Before Buying Bitcoin (Part One)

Elienai Julius

October 14, 2022·3 min read
Important Things You Should Know Before Buying Bitcoin (Part One)

As the world gradually adopts bitcoin, you might be considering jumping on the train as well. While I agree that investing in bitcoin is one of the smartest financial decisions to make in this day and age, you need to understand what bitcoin is before you invest in it — as is the case with every asset.

This is the first of two articles wherein I’ll walk you through five things you should know about bitcoin before you begin investing. While these articles won’t tell you everything about bitcoin, it’s enough to give you enough background knowledge to get you started. So let’s dive in!

What is bitcoin?

Simply put, bitcoin is a digital currency. One of the main things you need to know about bitcoin is that it is not controlled by any person, government, or organization. It is completely decentralized. The price of bitcoin rests solely on the forces of demand and supply.

Bitcoin is also a scarce commodity. As it stands, there will only ever be 21 million bitcoins. 19 million are already in circulation, with just 2 million left to be mined. Once this happens, more bitcoins will not be created. And because bitcoin is a scarce asset, the price of bitcoin will only keep going up. This is why I encourage people to buy bitcoin now.

This is unlike our local currency. The central bank can keep printing money, thus there’ll always be an infinite supply of the currency. This, however, negatively affects its value. According to the rules of demand and supply, when something is in infinite supply, the demand for it will be low and so will the price. It’s no surprise that the value of the different currencies in the world is currently devaluing. 

Over the years, bitcoin has increased tremendously in value and it will keep doing so because of its scarce nature. 

Now you have an idea about what bitcoin is, how do you get some bitcoin? Well, you’ll need a wallet. Now let’s talk about what a wallet is and how to use it.

 

 

Important
ALSO READ: Important Things You Should Know Before Buying Bitcoin (Part two)

How to use a wallet

A wallet is an online service where you can store digital currencies. You can also send and receive these currencies from wallets designed for them. To get started with bitcoin, you’ll need a bitcoin wallet to send, receive and store your bitcoin. 

When you create an account with Bitnob, you’re automatically provided with a BTC and USD wallet. So you can start buying, receiving, and sending bitcoin. Creating an account with Bitnob is easy; firstly, download the app. Once you do this, you create and verify your account. Once you’ve created an account with Bitnob, you can start buying and saving in bitcoin. 

In my next article, I’ll tell you about things you can do with bitcoin you probably didn’t know about, how to go about your bitcoin investment, and how to manage stress during market corrections, otherwise known as the dip. Stay tuned!