Bitcoin Hits Record Highs: A Guide to Investing in Cryptocurrency
Bitcoin has been making headlines lately, with values reaching record highs and approaching $100,000. It has doubled in value throughout 2024, sparking conversation and curiosity among many. Launched in 2009, bitcoin is the first cryptocurrency, a digital currency that operates independently of traditional banks.
The recent surge in bitcoin’s value, up about 130% this year, is attributed to various factors, including what some call the “Trump trades.” Former President Donald Trump’s interest in cryptocurrency, along with his family’s involvement in launching crypto firms, has led to speculation that there may be fewer restrictions on the industry in the future.
For those who may be new to the bitcoin buzz, here are some basics to help you understand this digital asset. Bitcoin operates on a decentralized blockchain network, where crypto miners validate transactions and earn bitcoin as they work. The total cap for bitcoin tokens is set at 21 million, with about 19 million tokens currently in circulation. As the cap nears, demand for bitcoin is expected to increase.
Interested in investing in bitcoin? You can purchase it through various platforms, such as crypto exchanges like Binance.US, online stockbrokers like Fidelity and E-Trade, and trading apps like Robinhood. If you’re not ready to invest directly, you can also explore bitcoin-based exchange-traded funds (ETFs) through online brokers.
Bitcoin can be used as currency for a wide range of purchases, with many companies accepting cryptocurrency as a form of payment. From AT&T to Tesla, there is a growing list of businesses that recognize and accept the value of bitcoin. And yes, you can even buy “art” with bitcoin, as seen in instances like the sale of a duct-taped banana for $6.2 million.
While the surge in bitcoin’s value has drawn attention and excitement from some, there are also concerns to consider. Warren Buffett has expressed skepticism about the long-term future of cryptocurrencies, while others like Anthony Scaramucci and Cathie Wood have made bullish predictions about bitcoin’s potential value in the coming years.
It’s important to remember that investing in bitcoin and other cryptocurrencies comes with risks, including volatility and potential market manipulation. As with any investment, it’s wise to only invest what you can afford to lose and take steps to protect your assets. Whether you see bitcoin as a wave of the future or a speculative bet, understanding the basics and staying informed can help guide your investment decisions.
