Bitcoin is really taking the world by storm. Unless you’ve been living a tech-free life for the past few years, you’ll likely have heard about its various ups and downs in the news. However, it’s proven itself to be a big player in keeping money anonymous and even easier to exchange.
In many ways, Bitcoin and other crypto can be wise investments. However, as
always, there’s risks – and there may not be many other investments beyond
Bitcoin that are quite so volatile right now.
Why might you want to invest in Bitcoin? Is investing in cryptocurrency a good
idea? Let’s take a look at what you need to know.
What is Bitcoin? (and how it works)
Bitcoin is a form of cryptocurrency. In short, cryptocurrency is a type of digital
money that can be used in financial transactions recorded by an online ledger
called blockchain. It is a decentralised form of money, and by using a set online
code, it is impossible to counterfeit.
One of the main ideas behind Bitcoin was to create a fast and simple way of ex-
changing cash – without the red tape. There is no need for a central bank, or
any professional interference, as crypto can be sent directly from one user to
another without any third party bureaucracy.
However, the transactions are verified by using what are known as network
nodes, which are then in turn recorded in the blockchain. So, there’s always a
record of what’s taken place.
Interestingly, the real creator or creators of Bitcoin are unknown, as they
worked collectively under the name Satoshi Nakamoto. To this day, no one re-
ally knows the true origin of Bitcoin. It’s a bit of a mystery – but it’s well worth
Unlike real or fiat money, Bitcoin has no physical form. However, it doesn’t
come from thin air. To get access to BTC, you’re going to need to mine for it.
Bitcoin mining revolves around mathematical equations. A high-power device
computes and calculates these equations, and once they are solved, the miner
in question receives Bitcoin. It’s a rewarding strategy.
Mining is a process that takes a lot of time and effort – and some of the time,
miners won’t even get rewarded for their efforts! As you can see, Bitcoin is
very much a risk and reward process.
Despite the volatility, Bitcoin remains the biggest name in cryptocurrency in
the world right now. It’s likely thanks to big names such as Elon Musk helping
to make cryptocurrency popular and viable.
But – on top of all of this – is Bitcoin worth your own time and effort in invest-
ing? Let’s take a look at the potential money you could be making.
Why you might want to invest in Bitcoin
Despite recent news regarding BTC’s volatility, you may have heard that it is
quite a lucrative form of investment. Having exponentially grown since its be-
ginning in 2009, Bitcoin investors have ridden waves and dips multiple times.
Many investors and experts believe that Bitcoin is the way in which all future
transactions are heading. Since it cannot be inflated, unlike other forms of cur-
rency, it does not run the risk of loss in value compared to fiat money.
BTC is still highly volatile – the peaks will always be as large as the throughs –
but due to its ease in use, accessibility, and lack of red tape, Bitcoin has made
a place for itself on the market and could very well be the future of all financial
transactions. At the very least, it’s changing the way that people, companies
and government bodies look at financial transactions.
Bitcoin is actually the fastest-growing asset of the past decade, despite the dips and valleys it’s experienced. Therefore, it could well be the asset you’re looking for if you’re wanting to make serious passive income in the years to come.
It certainly doesn’t come without its risks, however, and while you may be riding high on the waves at one point, things may dip at the next pass. Let’s take a closer look at what you need to keep in mind.
Things to consider before investing in Bitcoin
Bitcoin isn’t straightforward stock. Buying a single Bitcoin means handing over
thousands of pounds – what’s more, it makes sense to look into the drivers of
some of its biggest peaks and dips. It reacts to all kinds of things – while it may
not be affected so much by political events, BTC is not free from being com-
Risk is a huge factor in Bitcoin investing. It’s easy to believe from some of the
headlines that it will either be a guaranteed profit, or it will lose you stacks of
cash. In any case, as with all walks of investing, it’s never a good idea to put all
of your eggs in one basket.
Make a point to try Bitcoin – at least a small amount – before going all-in. This
might sound fairly obvious, but many people have lost a lot of money by following the hype train. Yes – BTC carries a lot of promise – but the fact is, it’s one of
the most dangerous investments on the market right now. Exciting, but highly risky.
Do also look at how BTC is being treated in the outside world. It’s still very
much an unknown entity both in the UK and abroad, meaning you’ll need to consider if the markets you are entering into will accept this currency moving
forward. The hope is that BTC will be ‘fully mainstream’ by the middle of the
decade, but a lot of that will depend on banking and governmental attitudes
the world over.
Now we know a bit of background information, let’s consider how to invest in
Bitcoin in the UK in practice.
Best ways to invest in Bitcoin
Yes, there are multiple different ways to invest in Bitcoin (and invest in crypto
in general) – and here three of the most straightforward options available to you
Buy Bitcoin directly using platforms such as Coinbase
Coinbase is one of the leading name in direct asset purchase. Buying Bitcoin
assets outright also tends to be one of the more popular routes for investing altogether. This is largely thanks to the fact that you get to keep your Bitcoin
outright. You’ll be able to transfer it to a wallet to store, too.
In fact – let me give you a bit of a helping hand – Get yourself $10 worth of Bitcoin
when you invest $100. Sign up through the link below and grab your bonus.
Invest in Bitcoin related stocks, such as Argo Blockchain
A safer and perhaps less volatile option may be to consider investing in stock
that’s closely linked to BTC. If you don’t want to risk buying cryptocurrency out-
right, investing in related stock means you still get to benefit from the returns –
albeit second-hand, and in fiat currency. You can find a number of these stocks on trading platforms such as Freetrade or Trading 212.
Use a CFD trading platform such as eToro to trade in Bitcoin
eToro remains one of the most popular investment engines for BTC trading, and while by trading via *CFDs you won’t actually own any coins, you still get to participate in the thrill of the ups and downs. That’s because – rather like
in sports betting – you are betting on what way BTC is going to go at any one
time. If you’re less concerned with holding the actual asset itself, then eToro may well be the route to go. Particularly if you are looking for a one stop shop platform for stocks as well as crypto.
*Be aware that CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 67% of retail investor accounts lose money when trading CFDs with eToro. You should consider whether you understand how CFDs work, and whether you can afford to take the high risk of losing your money.
How risky is investing in Bitcoin?
Despite the fact that Bitcoin is largely unaffected by big events that can topple
fiat currencies, it is still regarded as one of the most volatile instruments on the
Unlike regular company stocks, where prices alternate depending on how the business is performing in the current state of the market, Bitcoin’s value can
revolve around speculation. There’s nothing to say it could spike or dip at any
moment. Even a stray tweet from Elon Musk could send it plummeting, and
funnily enough, this has happened in the past.
Of course, even with the best research, any investment is a gamble. Diversification is key, and with that in mind, you may wish to look at other cryptocurrencies out there before throwing all your money behind BTC.
What are some of the most popular crypto alternatives to Bitcoin?
Bitcoin is certainly not alone on the market, and while it’s still very much the
biggest name in crypto, there are other options that you may wish to consider.
- Ethereum, for example, is largely regarded as the second-fiddle to BTC. It
was created in 2015 by programmer Vitalik Buterin, and like Bitcoin, it is
a decentralised, open-source currency.
- Litecoin, in fact, is older than Ethereum, having debuted back in 2011.
It’s very much Bitcoin in all but name, and in fact – as the name suggests
– it’s often seen as the ‘diet’ alternative. Worth a look, perhaps.
- Dogecoin, meanwhile, is a type of crypto that’s gained a lot of attention
recently for various reasons. It’s based on a fairly old meme, and it
spiked massively in 2021 – with a little help from, you guessed it, Elon
How to get free Bitcoin
Want to try Bitcoin and see if you can make some passive income endeavour the years to come? Get started with my link – You’ll get $10 worth of Bitcoin free with Coinbase when you sign up and invest at least $100. Coinbase is a brilliant hub for all things crypto, such as in terms of education, savings resources and more.
Bitcoin is still just emerging from its niche. It’s likely to change the way that many people see money in the years to come, and it won’t be surprising to see it take up further spikes and dips. Try and dip your toe in the water before you go all-in, and see how you get on.
Even if you’re just learning how to invest in Bitcoin in the UK – now really is the
time to do some homework and to see what all the fuss is about. A bit of free
cryptocurrency really won’t go amiss, either!