Words like Bitcoin and blockchain were mentioned only by tech-savvy investors just a few years ago.
Some thought it was a fad, and others were hesitant to get involved. However, now that Bitcoin has reached a value of $50,000, everyone has cryptocurrency on their minds.
So what makes it so special, and how exactly can you make money with Bitcoin?
Let us show you our guide on how to get started. But before we do, it’s important to know exactly what Bitcoin is and how it works.
Let us break it down for you.
What Is Bitcoin?
Bitcoin is a form of currency that cuts out the middle person in digital transactions. Instead of your payments being subject to charges and leaving your account after a few days, payments in Bitcoin are immediate, peer-to-peer transactions.
To eliminate fraud, payments are verified by the Bitcoin community, and once verified it is logged in the public record known as the blockchain.
Governments are still unsure of how to regulate Bitcoin, or if it is even possible. Regardless of this, it is still important to know that Bitcoin carries a tax. Follow this link if you want to know more about Bitcoin tax.
Invest and Hope for the Best
The simplest way to get your hands on bitcoin is by buying it from a bitcoin exchange. Some of the most well-known include Robinhood, Coinbase, eToro, and Coinmama.
It is easy to get lost in all the terminology, but at its core, Bitcoin is a currency much like the dollar, yen, or pound sterling.
This means you can trade-in your money on the exchange and get bitcoin in return. Once you have it in your bitcoin wallet, you can decide on the right time to cash in, or hold on for future upturns in the market.
Although Bitcoin is simple for most people to understand, there are typical stock market risks involved. Markets can be volatile and you need to have your head in the charts to know when it’s the right time to stick or twist.
Prices may spike or fall, but the “hold on for dear life” method, although slow, has made those who were patient a lot of money over time.
Similar to investing, if you are someone who is on the ball, fearless, and enjoys the idea of making quick cash, then day trading may be the perfect way for you to make money with bitcoin.
The main difference between this and bitcoin investing is that to make money with bitcoin through trading, you need to use the up and down nature of the market to your advantage.
Day trading is where small amounts are made through quick transactions, capitalizing on minor dips on the exchange to buy and sell when prices spike, then repeating the cycle over the day.
If that seems too fasted paced for you, you can still trade and make money with bitcoin using the arbitrage or swing method. Swing traders hold on for longer than a day trader would, but use the same principles. Arbitrage traders on the other hand monitor more than one exchange at a time, selling and buying between them.
Swing and arbitrage trading are viewed as less risky; however, all of these methods are not for the faint-hearted or uninitiated, so before stepping into the arena, be sure to learn three things:
How to do thorough research, read charts, and analyze the market.
If you have glanced over any material related to Bitcoin then you might have heard about bitcoin mining.
Remember that we explained that transactions need to be verified. Bitcoin miners do this and they are paid in bitcoin for their work.
The main idea behind mining is your ability to be the first to guess the mathematical code connected to a payment. But before panicking about not being a wizard with figures, this is done automatically on a computer simply by downloading one of the many applications available.
While a lucrative game at Bitcoin’s inception, bitcoin mining depends much upon computer power. To earn bitcoin worth the costs of running the electricity to power your computer today, you either need a fast rig (a computer with a fast processor) or to join a lucrative mining pool.
Much like a lottery syndicate, those in a pool split their earnings among themselves.
Make Money With Bitcoin Doing Micro Jobs
While the other options all involve a bit of know-how or hardware, one of the simplest ways you can make money with bitcoin is through doing micro-jobs.
Sites like Bitcoinget pay users in bitcoin to take surveys and watch videos. There are also pay-to-click sites that ask you to go through to certain sites and carry out tasks and crowdsourcing sites like Cryptoperhour that payout for real work in bitcoin.
It is not the most glamourous, lucrative, or entertaining way to make money with Bitcoin, but if you have a lot of idle time, it is an easy path to start filling your bitcoin wallet.
Accept Payments in Bitcoin
Are you a business owner?
If so, it may be worth considering accepting payments in bitcoin. As already mentioned, the main advantage is that bitcoin payments are quick. What you earn could potentially be more valuable than the cost of whatever you are selling!
One word of advice. Research what pricing equivalents would be and set your prices to make sure that you don’t get short-changed.
Which Way to Earn Bitcoins Will You Choose?
As is the case with anything digital, things are constantly changing in the world of cryptocurrency. The good news is that everyone, including you, can make money with Bitcoin today.
So figure out what works for you, and we hope that you can reap the benefits, now and long into the future!
If you enjoyed this breakdown, be sure to check out our other finance posts on our blog.