In this episode, we will discuss some options that people have used to Invest in Bitcoin and crypto-currencies on their local stock markets. Before we begin, let us be clear that at LearnByCartoon.com we do not give or offer any investment or financial advice. LearnByCartoon.com are an education service, not an investment or financial advice service. We do not even promote the purchase of Bitcoin or any crypto-currency. Before you invest in any crypto-currency, you must do your own due diligence to see if this is right for you. We also advise that you speak with a reputable financial advisor.
DigitalX is an exchange listed on the Australian Stock Market. In two thousand and seventeen, on the back of the massive price rise in Bitcoin, the DigitalX stock price went up over seven hundred percent. If you search for crypto-currency businesses listed on stock markets that you can legally invest into, you may find similar companies, showing similar profits, that operate as either exchanges or related businesses. However, there is absolutely no guarantee that investments into crypto-currency related stocks on any stock market will increase in value consistently over time, and losses could occur.
- Many World-renowned Economists say that although crypto-currencies are here to stay, this does not necessarily mean Bitcoin itself will be one of them. Nouriel Roubini, professor of economics at New York University, who is the economist credited with predicting the 2008 global financial crisis, said the sharp fall of the Bitcoin price at the beginning of twenty eighteen, was the start of a crash that would see the value of the digital currency plummet “all the way down to zero”.
- Renowned economist Andy Xie from Shanghai, considers Bitcoin a massive Ponzi scheme that can potentially cause a crisis that is “worse than 2008.” Xie also went onto say, “This is a Ponzi scheme. The difference from the past ones is that it is global due to the Internet and, hence, all the people in the world can join. This is why it can go way beyond other schemes.”
- Professor Steve Keen, Head of the School of Economics, at Kingston University in London has said “It is becoming obvious that Bitcoin can’t be independent of regulation given that criminal attacks and “intelligent fraud” can’t be ruled out.” Professor Keen went on to say, “there is enormous pressure on the buy side of bitcoin and there are almost no sellers.”
As more people are drawn to buy into the limited number of Bitcoin that actually exist, the price naturally rises very quickly.
However there have been several recorded periods of sudden massive selling, which has dropped the Bitcoin price just as quickly as it went up. Also today there are many alternative crypto-currencies to choose from. And major financial institutions and banks are now creating some of them. One example is ‘Utility settlement coin’ created by six of the world’s largest banks. This aims to come into circulation sometime in twenty eighteen. We don’t give investment advice, and we cannot predict the future for Bitcoin or any other crypto-currency, however crypto-currencies are most certainly here to stay in one form or another. One associated technology that is witnessing a massive rise in investment, and that does not depend on any one specific crypto-currency is the Crypto-Currency Hardware Wallet. Hardware Wallets are not only used to store Bitcoin, they can also store many other crypto-currencies. Most Hardware Wallet manufacturers, such as Ledger who produce the Nano S Hardware Wallet, are still privately owned, so investment opportunities is still limited, at least for the moment, but this is one sector of investment that may be worth keeping an eye on.
Whatever you decide to do, here are some basic things to keep in mind with all crypto-currency investments.
Take care when Investing in Bitcoin – Digital Currencies are High-Risk
- Bitcoin and the Blockchain, plus all other crypto-currencies are entirely new technologies.
- Several Crypto-currencies are actively competing against each other, and no clear winner has yet been established.
- Many Governments and Financial Institutions are actively opposed to Bitcoin and crypto-currencies. This could impact taxation or market fundamentals in the future.
- Historically, rapid price increases in Bitcoin have been followed by rapid price declines.
- If you do invest in Bitcoin or crypto-currencies, never invest more than you are willing or able to lose.
- Bitcoin and other crypto-currencies are a very risky investment and you should keep this in mind at all times.
- If you buy Bitcoins make sure to move them into your own personal wallet and never leave them at the exchange.
- Several exchanges have been hacked and have failed.
- Exchanges are not Banks, and some online Bitcoin services have proven to be scams.
- Ideally, use a hardware wallet such as a Ledger Nano S, or Trezor Bitcoin Wallet to store your Bitcoins, as these offer the most robust security.
- If you can’t afford a hardware wallet, try a paper wallet to take your Bitcoins offline and away from computers and Internet access completely.
- Make sure to do your own due diligence.
- Research and buy Bitcoins only from exchanges that have proven their reputation.
- It’s also a good idea if you do buy Bitcoins, to buy Bitcoins using Dollar cost averaging. This means that you don’t buy all of your Bitcoins at one time, but instead buy a fixed amount every month, or every week throughout the year. This will help you average the purchase price of your Bitcoins over the course of a whole year as the price rises or falls. This also helps to spread your risk.
- Most importantly, remember the price of Bitcoin can go down just as quickly as it went up.
Many people have bought Bitcoin, and many people have also lost them. There is still a lot to learn about Bitcoin, and we urge you to continue your education through websites such as Bitcoin.org or Bitcoin.it