How To Make Money From Bitcoin

by Ben Alford

As you’ve probably seen in the news Bitcoin has exceeded the value of an ounce of gold for the first time. What is Bitcoin? How can you make money from Bitcoin? Hopefully this post will answer some of your questions, and also shed light on alternative cryptocurrencies.

Firstly what is Bitcoin?

Bitcoin is a form of digital currency, created and held electronically. No one controls it. Bitcoins aren’t printed, like pounds or euros – they’re produced with computers by people, and increasingly businesses, all around the world, using software that solves mathematical problems.

Bitcoin can, just like your credit/debit card be used to buy things electronically. In that sense, it’s like conventional pounds, euros, or dollars, which are also traded digitally.

However, bitcoin’s most important characteristic, and what makes it different to conventional money, is that it is decentralized. No single institution controls the bitcoin network. This puts some people at ease, because it means that large banks or organisations can’t control their money.

 

How can you make money from Bitcoin?

There are lots of ways to make money from bitcoin, however the most simple way is to invest in Bitcoins. The same way you would invest in stocks and shares or a different currency, just exchange your pounds for bitcoins. Back in Bitcoins early days this proved complicated but know its really easy, simply signup to an recognised Bitcoin exchange platform like CoinBase.

Just to give you an example of how lucrative bit coin has been for some people, back in 2010 you could buy a bitcoin for $0.06 and today a Bitcoin will set you back $1,200. To put that into prospective if you had invested $60 dollars then(1000 Bitcoins), that would now be worth $1,200,000.

Now obviously its too late to try and make massive gains like that, but in theory Bitcoins price has no limit so its still possible to make gains. I have invested in one myself back in 2014, and continue to buy more on a regular basis.

How to invest in Bitcoin (step by step)

  1. Open an account with a trading platform, my suggestion is CoinBase. Do the research yourself, however CoinBase is one of the most reputable Bitcoin platforms out there. Also you can by Ether coins (which will be explained a bit later on).
  2. Follow the setup process, this includes uploading a form of ID.
  3. Add a payment method, either transfer funds or uses a debit/credit card
  4. Buy your Bitcoins, you don’t have to buy a whole Bitcoin.

 

The best Bitcoin alternatives

There are many alternatives to Bitcoin, the two that I think could be the next Bitcoin are Ethereum (Ether) and Ripple XRP. These to alternatives to Bitcoin are still relatively new and therefore much cheaper than Bitcoin.

Ethereum:

“Ethereum is a  decentralized platform that runs smart contracts: applications that run exactly as programmed without any possibility of downtime, censorship, fraud or third party interference.”

What makes this digital currency stand out? The fact its been started from crowed sourcing, and has recently increased in value to $20, it has also become more mainstream. You can now Buy Ether (ETH) coins on CoinBase, which shows its becoming very popular, and has been tipped to out perform Bitcoin.

How to invest in ETH coins?

  1. Open an account with a trading platform, my suggestion is CoinBase. Do the research yourself, however CoinBase is one of the most reputable Bitcoin/Ether platforms out there.
  2. Follow the setup process, this includes uploading a form of ID.
  3. Add a payment method, either transfer funds or uses a debit/credit card
  4. Buy your Ether (ETH) coins

Ripple XRP

Ripple XRP is my second favourite alternative to Bitcoin because of the large companies backing it, and the fact its so cheap $40 or £30 will land you about 7,500 coins. I see potential in Ripple to replicate what Bitcoin has achieved, and if you bought in at the minute you could potentially make lots of money in the future.

  • Big names such as Andreessen Horowitz, Google Ventures and Santander have all got stakes in Ripple.
  • More economical and faster than Bitcoin
  • XRP is a digital asset just like bitcoin. XRP is the native digital asset to the Ripple network.

 

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