When people talk about cryptocurrency, the first name that comes to your mind is Bitcoin. For most investors, this intro to bitcoin could be their first step into the world of cryptocurrency.
Bitcoin is the number one cryptocurrency globally, and it has successfully maintained its number one ranking for several years. So, if you are interested in cryptocurrency trading, bitcoin can be a good option.
Here are some questions you may have about bitcoin trading and storage.
What Determines the Price of Bitcoin?
Bitcoin price is affected by many factors like the demand and supply of bitcoins and competing currencies, legislations, etc. The popularity of bitcoin has increased over time, and while it is not yet legal tender in most countries, it is still considered an excellent investment opportunity for young investors.
Does Bitcoin Have Value?
Yes, bitcoin has value. As per recent data, the price of one bitcoin is around 43,979.20 USD. But, of course, the price of bitcoin fluctuates with time and market conditions, and you can expect its price to rise and fall like traditional currencies.
Can You Buy Bitcoin With Real Money?
Yes. Many crypto exchanges allow users to buy bitcoins with fiat currencies. The process of buying bitcoins is simple, and it is well explained in the intro to bitcoin sections on the crypto exchange website. The steps involve funding your crypto trading account with your checking account and using the funds to buy bitcoins.
Can You Buy Bitcoins in Large Amounts?
Yes, you can buy bitcoins in large amounts through the crypto exchange. In addition, many exchanges allow users to buy large amounts of bitcoin through OTC (over-the-counter) trade. You need to place an order for bitcoins, and the sellers will respond to your request.
Do I Have to Pay Fees for Bitcoin Trading?
Yes, bitcoin trading does not come free, and you need to pay certain fees to the crypto exchanges. Some of the trading fees you should be aware of are deposit and withdrawal fees for fiat currencies, trading fees, and deposit and withdrawal fees for cryptocurrencies.
Some exchanges charge a percentage or a flat fee for depositing and withdrawing funds to your checking account. However, some investor-friendly exchanges do not charge deposits and withdrawal fees for fiat currencies or cryptocurrencies. Instead, the trading fee is generally a fixed percentage of the trading volume. In addition, some exchanges offer high-volume discounts that help you save money.
How Is Bitcoin Stored?
There are many ways to store bitcoins. For example, you can store your bitcoins on your personal computer with a “wallet file .”Another way to store bitcoin is using a digital wallet service provided by crypto exchanges.
How Are Bitcoins Stored in a Digital Wallet?
Bitcoin is digital money. It means it exists in virtual form. When you store bitcoins in your digital wallet, you store cryptographic information used to access Bitcoin addresses and send transactions.
Are Digital Wallets Safe to Store Bitcoins?
Yes, it is safe to store bitcoins in a digital wallet because it is secured by two-factor authentication and fast biometric logins to ensure an unauthorized person does not have access to your bitcoins.
What Is a Hot Wallet and a Cold Wallet?
A hot wallet is a digital wallet that runs on Internet-connected devices like tablets and computers. A cold wallet refers to a digital wallet that is not connected to the Internet.
Many investors find hot wallets convenient for trading as they don’t need to transfer their bitcoins to hot wallets before transactions. Conversely, cold wallets offer more security as they are not connected to the internet at all times.
These are some common questions people generally have about bitcoin trading and storage.