Why do people buy Bitcoin – How is it different?

, ,
why do people buy bitcoin

Nothing should be considered investment or financial advice. Enjoy the ride.

If you have been wondering lately,

Should I invest in crypto?

Why do people buy Bitcoin?

What is the point in purchasing a virtual coin?

Should I invest now or is it too late for crypto?

Then you probably should read all of this post. But please, make sure to do your own research fully before investing in crypto.

For starters, you need to educate yourself on any investment before you put money towards it. Although, this post really is not an introduction to cryptocurreny. It is more of an investor approach which aims to answer the questions above.

For instance, we are not going to be discussing the technology behind Bitcoin like hashing, blockchain, SHA-256, mining, or anything that goes into the actual backend.

This post is to merely dive into the idea of purchasing crypto, what it does for you, how it differs from traditional assets, and what you can do with it.

Therefore, lets dive into the first part: purchasing crypto.

What does it mean to purchase crypto

Getting right into it, lets talk about purchasing crypto. I mean what does it mean to “purchase” a Bitcoin? How about “purchasing” an Ethereum?

What about only buying part of a Bitcoin?

Well hang on for a minute and I’ll explain.

If you are going to purchase crypto then what you are really doing is moving Bitcoin from one wallet address to another. Sort of like taking a dollar bill out of your wallet and placing it in another person’s wallet.

You see, in order to hold Bitcoin or any cryptocurrency for that matter, you are going to need a wallet address that the crypto’s blockchain can record. You can not hold Bitcoin without a wallet. This is very important.

The blockchain keeps a public record of every single coin, address, data, and much more on some blockchains.

So, if you are going to purchase crypto you are going to need a wallet address. But don’t worry, these are very easy to get. You can even just join an exchange like Coinbase who will set you up with a native account on their platform that is connected to their wallet address.

This native account allows you to easily move, trade, and send funds without having to actually interact with the blockchain or wallets directly.

Pretty cool huh.

So in short, purchasing crypto is transferring a crypto (or piece of one) from one wallet address into your own. The blockchain keeps up with the public ledger and lets everyone know that your wallet is holding that coin.

What does owning crypto do for you

Well, what does “owning” or “purchasing” crypto do for you?

In a short response, it allows you to claim ownership of that token and move, trade, sell, or simply hold it. It is very similar to holding a stock of a company.

For instance, you can purchase Bitcoin and just hold it in your native exchange wallet to try and make trades to grow your wealth. Similar to how people trade stocks. Or you can send it to your friend’s wallet as a gift, stake it in an interest account to get passive return, hold it for appreciation (which is what most people do), use it as a currency on some select websites that accept Bitcoin, forget it forever and lose your money, or simply just celebrate owning a digital coin.

Why do people buy bitcoin

You can think about Bitcoin as like owning a digital dollar that has these attributes:

  • Send anywhere around the world for payment, gift, etc.
  • Value changes based on the market daily. Could one day grow to 100k!
  • You can take it off the network and hide it in cold storage.
  • The government can’t stop it

So, as you can see there are many benefits to buying Bitcoin! People purchase crypto for many difference reasons as well. Some just like it because it’s different. Some want diversity in their wealth, and other people want to just get rich.

Regardless of your investment reasons, there are plenty of them for people to put real money into crypto. More than that, crypto is over a trillion dollar market at the time of the recent bull run. That is huge! If you are still wondering why people could possibly put their real money into internet money, then maybe take some time to realize, the world is moving to a digital age. It might be a day soon where money is all digital anyways. It might be a good idea to go ahead and learn more today! Who knows, you might just buy some yourself.