If you are thinking about investing in Bitcoin or if you’ve already done so I thoroughly encourage you to listen to that episode. Maybe you can do it after this one. In this one I’m going to basically show you really quick and easy how to invest in Bitcoin, if you want to buy Bitcoin and how I’ve done it, and what I consider a safe way to do it.
Hi Dee Ho neighborinos. This is Allen Sama coming to you from the Option Genius Podcast. This episode is going to be more like part two of the Bitcoin or maybe Bitcoin part one continued, whatever it is. In the last episode what I did was I talked about how awesome Bitcoin is making everybody go crazy. There are people out there who want to take advantage of you. Shocking, right? They are using Bitcoin as the new way to do it. What I did was I outlined three different scams that people are using online to trick people into giving them money in the ruse of getting rich with Bitcoin.
If you are thinking about investing in Bitcoin or if you’ve already done so I thoroughly encourage you to listen to that episode. Maybe you can do it after this one. In this one I’m going to basically show you really quick and easy how to invest in Bitcoin, if you want to buy Bitcoin and how I’ve done it, and what I consider a safe way to do it. Do this one first maybe. Or maybe this one should have been episode one. Yeah, this one now makes more sense, right? This one could be How Do You Trade in Bitcoin and the other one would be How To Avoid Scams When Trading in Bitcoin, that would be part two, but we did that one first. This one’s going to be part two. Short and sweet.
First of all, I think that Bitcoin is going to be here for a while. The technology is pretty cool. The way it works. It is most likely going to revolutionize banking, just because of the way it is structured. It is legitimate and I hope that it does not collapse. There are no guarantees. Yes, it could collapse any day now. One of the large governments, maybe the EU, or China, or the U.S. or somebody comes out, bans Bitcoin or places some really crazy legislation on it that makes it super hard to transact. That could be the end of it. Hopefully that does not happen. Hopefully they use it in a way that helps society, but you never know.
Until that happens … I mean there’s always buts, but until that happens the future looks really bright for Bitcoin because about a month or two ago a firm in Japan announced that they are going to be starting to offer options trading on bitcoin. The CME Group announced last week that they are going to have a Bitcoin futures contract that can be traded and probably options on that contract as well, right? That’s why the price jumped up well over $7,500 a coin. Since then, it has retreated a little bit, but it’ll probably continue to go higher. There was a fork coming up, another fork coming up and I’ll tell you what that is in a little bit.
More and more companies are accepting Bitcoin as payment. I think that’s the one key that’s going to make it really, really legitimate. If it’s easier to use, if the common person adopts it as a additional currency, so you’ve got cash, you’ve got credit card. You don’t have check anymore. Nobody really takes checks. You’ve got cash, you’ve got credit cards, and then you have Bitcoin. That would really give it a firm foothold, not only in the U.S., but all the way around the world.
I do think that you should buy some. I really do. It’s something new. It’s kind of like a long-term call option. You do it with some money that you can afford to lose. It wouldn’t be a last ditch effort and say, “Hey, you know what? I’m gonna get into trading Bitcoin because it’s so volatile.” I don’t think this is a trading type thing. This is a buy and hold type thing, Bitcoin itself, I’m not talking about other cryptocurrencies. I’m talking about Bitcoin.
For me, I am going to buy it. I have bought some. I bought some back in April 2017, it was somewhere around $2,500 or $2,200 a coin. I bought a couple of coins then. Then I bought some more when it was around five. I bought one more coin at 7,000 and I’ll probably be buying some more if it keeps going up. I think it’s going to be very hard to trade this, unless you are sitting there all day long in front of your screen trading it up and down, just like you do in the stock market, right?
There are plenty of opportunities. If you’re a day trader, you can trade Bitcoin. It’s pretty volatile. If you’re a normal person like us, like me, this is not a trading thing. You buy it. You hold it. You don’t think about it for at least another three years until 2020. I say that because 2020 is when they are expecting that there will be no more new Bitcoin, because right now they are still mining. Mining is another word for making.
People who have computers can actually mine and make their own Bitcoin. In the past, it used to be where you could do it from your own computer. If you had a computer in the basement, you could set it up to mine you some Bitcoin. As more and more people get into it, it gets more and more difficult to mine. Now, you actually have to have a very sophisticated setup in order to be mining Bitcoin. It’s just going to get harder and harder to mine, until we get to that limit where … oh, man, I forgot the number. I think it’s 20 million coins can be made total. You can’t have more coins than that.
Once that amount is reached, once the world gets to no more new Bitcoin I think the price will actually explode from there because then you won’t be able to make it. You can only just buy it. I think the price will go up from there. I think until 2020 is definitely when you should be holding these. I don’t think you should be selling any of them until that date, at least. Until they’re done. That’s what I’m planning to do. That’s what I’ve told anybody that’s asked.
The question is how do you do that? How do you get into Bitcoin? If you’re in the U.S. there is a company called Coinbase. C-O-I-N-B-A-S-E. Coinbase.com. They are probably one of the largest if not the largest Bitcoin brokers in the U.S. right now. If you go to their website, you can sign up right away. You can connect with your bank account or even your credit card and then you just tell them how much you want. They’ll transfer the money. They’ll buy the coin for you and then when the money actually transfers, then they will put the coin in your account. They do charge a very hefty commission for that. If you’re just going to buy a little bit, you’re just going to do it once, then you’re fine with Coinbase.
If you’re going to be doing a little bit more and the commissions are going to hurt you then you need to go to GDAX, which is the letter G and then the letter D as in David, A-X.com. They also owned by Coinbase, but it’s kind of more like a software. You can actually trade a little bit more easily and the commissions are a lot lower or even almost zero, depending on what type of orders you use. If you use a limit order and you don’t go in at the market, then you can get in at no commission because they’re actually using you to make a market. Because there are no true market maker like in the stock exchanges.
What GDAX is doing is if you want to go at the market and say, “Yeah, I just want the coin right now, I don’t care what it is, just give me the price at whatever it’s trading.” They will charge you a commission, but if you go in and if you leave your orders open as a limit order, then maybe you might get filled, you may not get filled but they will not charge you a commission because you’re helping to make the whole ecosystem better by having more and more open orders, it helps Bitcoin itself and it helps GDAX and it helps Coinbase. That is a way to not pay any commissions on the trades that you’re doing.
Now once you have the coin, you can leave it in your Coinbase account, or what you can do is you can put it into something called a wallet. Now, the risk with Bitcoin is that there is no protection, right? There’s no FDIC. If your coin is stored with Coinbase or any other of these brokers and that company happens to go out of business, well then there goes your coins. There goes your money. It’s gone. It’s not recoverable.
What the experts are saying is that you need to have a wallet and you need to keep your coins in the wallet. There’s no physical coin and there’s no physical wallet. Basically, all it is, is a series of numbers and letters and a string of keys, really. That is what your coin is and that’s what your wallet is. You save the code of your coin. You put it in a wallet.
Coinbase does have their wallet. That’s a little bit more secure than just having it in the Coinbase account. You can put those in that wallet, or you could have your own wallet. You can even get pretty sophisticated with it. You can even have a computer that is not connected to the internet and have your keys saved on that computer. That way nobody can actually hack into your account. Nobody can hack into your wallet and steal your coins because that’s probably gonna be the thing of the future, where the hackers are gonna go after the coins and try to break into these wallets. We’re looking at something that’s probably coming down the pike. It might be a little bit too hard right now. They have other ways to make money. Eventually the hackers are going to start hacking into these wallets. We’re gonna have to come up with a way to keep them. For now, I think you’re pretty safe if you have that Coinbase wallet. I have some in there, as well. I haven’t taken the next step.
There is something called a Trezor wallet. That’s T-R-E-Z-O-R. That is pretty safe. That has a lot of pros for it. A couple of the cons but it seems to be a pretty safe … I haven’t used it so I don’t know. From what I’ve seen, people have recommended that as a safe way to keep your coins.
There you have it. It’s pretty simple. You go to coinbase.com, or GDAX. Open an account. It’s the same company, your money with your credit card, or your bank account and buy whatever coin you want and then you store it in a wallet. That’s pretty much all you have to do. Like I said, I don’t recommend buying and selling and buying and selling, trading in and out. Just hold onto it. Hopefully it’ll go up. It has been going up, so far. I don’t know if the percentage is going to rise is going to keep going up, because the more it goes up the harder it is to maintain that acceleration. At least until 2020, I think, it will be a fun investment, so to say. Something that’s interesting. Something that you can talk about at cocktail parties or whatnot. It’ll be pretty cool. I’m hoping that it keeps going up. I can keep adding to it. Hopefully, it’ll pay for my kids’ college. That’ll be super cool, if it could do that.
There are other coins, as well. Bitcoin is not the only game in town, although they are the mac daddy of all the coins. They’re the original. They are the biggest one out there. All the other coins out there are attached, in some way, to Bitcoin. If you want to buy any of these other coins, and there are thousands and thousands of these other cryptocurrencies, as they’re called. If you want to buy any of those first what you have to do is buy Bitcoin. Then you have to transfer it into these other coins. That’s how it works. Why would you want to take the extra step? Unless there’s a specific reason, unless you are going to be trading. I don’t think you even need to go into any of these other coins, but there are some other ones that I have bought.
Two that I have are probably the two that are the most accepted behind Bitcoin. They are the Litecoin and the Ethereum coin, which is also called Ether. If you hear somebody talking about Ether, they’re talking about Ethereum. Both of these coins are also available on Coinbase. I think that’s one of the reasons they are as big as they are because Coinbase said, “These are good. They’re stable. We’ll support them.” You can buy both of these also on Coinbase.
Both of them have gone up significantly this year in percentage. Several hundred percent. For the last couple of months, they’ve actually kind of stabilized and gone down a little bit, so they are not jumping up as much as Bitcoin has been doing. That’s why I made initial investments in those. I put about $1,000 in each one, just as another bet. I haven’t put any more money in because they haven’t been going up. If you want to, you could take a look at those. They’re not really doing anything. Most of the action right now is happening in Bitcoin itself.
Then, if you want to even go further risk even, you can look at some of these other Bitcoins that are out there. You can find a lot of information on YouTube and Facebook about all these coins. Just be very, very careful. Don’t buy something based on somebody’s recommendation. Really if you’re gonna go into this space, I would say you just stick with Bitcoin, unless you’re gonna do a lot of homework. Unless you’re really gonna understand how these coins work. How the blockchain works. What makes a coin valuable and not. What coins are out there. If you’re gonna live in that and you’re gonna spend a few hours every week following on these things and staying on top of the news and whatnot.
If you’re doing that then, yeah, go into the other cryptos, but if you’re not, if you just want something that, “Hey, you know what? I don’t want to be complicated about it. I just want to put money in and to make it go up.” Just stick with the Bitcoin. Stick with Coinbase. It’s the easiest way to do it. So far it’s been working. That is how I’ve been doing it.
Like I said, part of my investment has been up almost … Well, from 2,500 to 7,500 … What is that? A couple hundred percent. It’s done really well. The other ones, they haven’t gone up as well because I bought them later on, but I am overall very, very profitable on my investment so far. I hope it’ll continue.
If you want to, like I said, just do it like I’ve laid out in this episode. Then go ahead and also listen to the past episode where I talk about the three different scams that are out there, because there are … Even if you’re just going to stay with Coinbase, if you are going to be investing your money, the other three scams are very prevalent right now. I don’t think they apply only to Bitcoin and cryptocurrencies. They can and they are applied to other areas of finance, as well. Penny stocks, options, stocks themselves, major stocks. I think that you should listen to that one and open your eyes and see what’s out there. It’s kind of like a really exposé of the different industries. Please, pay attention to that one. Keep your eyes open. Do your homework and always trade with the odds in your favor!