When you weren’t stuffing your face with leftover turkey this weekend, you probably saw the word “Bitcoin” pop up on your timeline. Outside the digital currency plot line of Mr. Robot, many people have likely never heard of Bitcoin, and even fewer know what the hell it is. So CASSIUS put together a step by step guide to this cryptocurrency.
What Is Cryptocurrency?
Before you start figuring out how to invest in Bitcoin, you need to understand exactly what cryptocurrency is. It’s a digital asset that acts as a form of currency that is extremely secure. The nearly uncrackable code is often created anonymously and can be used to track purchases and transfers. According to The Telegraph, cryptography was developed during World War II and the money aspect of it didn’t come about until the digital age as a way to securely send information.
What is Bitcoin?
Sitoshi Nakamoto accidentally invented Bitcoin in 2008. He initially wanted to just build a “a peer-to-peer electronic cash system” in an effort to prevent double-spending, and ended up with Bitcoin. It became the first decentralized cryptocurrency with no user outranking others. In typical centralized banking, like the Federal Reserve, the supply and printing of currency can be controlled. That control doesn’t exist in Bitcoin.
“Announcing the first release of Bitcoin, a new electronic cash system that uses a peer-to-peer network to prevent double-spending. It’s completely decentralized with no server or central authority,” Satoshi said when unveiling bitcoin to the world.
How Much Does It Actually Cost?
Buying Bitcoin is expensive for the average person, but it is nowhere near the cost of the most expensive of stocks. It has seen seven surges this year, with the most recent coming over the Thanksgiving weekend. After barely hitting $8,000 per unit a week ago, it could hit $10,000 as soon as today, as it currently sits at $9,9731.51. If you do decide to invest in Bitcoin, it may seem like a hefty entry price, but you can still get in at this point.
Should You Invest?
Should you invest in Bitcoin? Only if you’re willing to risk it all. It is like an extremely volatile stock: it’s great for risk takers, but in the end it could cause you to lose your entire investment. Dallas Maverick’s owner Mark Cuban says that you should only invest in Bitcoin if you’re prepared to lose that money. “[You’ve] got to pretend you’ve already lost your money,” he once told Vanity Fair. Entrepreneur Tony Robbins has similar thoughts on the riskiness of Bitcoin, saying its like “going to Vegas.” If you do decide to invest, don’t sink more than 10 percent of your savings into it. Follow Bitcoin’s unprecedented growth and decide if you want to invest here.