7 things you should know before buying bitcoins and other cryptocurrencies

Discover 7 essential things you need to know before buying bitcoins or cryptocurrencies so you can learn about this revolutionary market.

You have probably heard the idea of buying bitcoins or cryptocurrencies as an investment method to make your money profitable on many occasions, and you probably already know someone who has joined the bitcoin craze and has invested part of their assets in this striking world of digital currencies.

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Digital currencies, a growing trend

If you are close to finishing college or have already landed your first professional job, it is reasonable that you are thinking of a convenient way to use and invest your money to get closer to achieving your personal goals as quickly and easily as possible, whether it is traveling, buying your first car or apartment, or creating your own business.

If you are considering entering the world of cryptocurrencies motivated by the popularity that this market has achieved in the last decade, it is important that you know and understand a series of elements that will help you in the process of buying them and will improve your experience at the beginning of this new financial adventure.

Here are 7 important things you should know when buying bitcoins and cryptocurrencies:

1. What are cryptocurrencies? What is Bitcoin?

Before buying cryptocurrencies, you should have a general understanding of what these two frequently mentioned concepts refer to and how they relate to each other. 

Cryptocurrencies are digital currencies, meaning they do not exist physically and are characterized by being decentralized as they do not require a financial institution or government to control and regulate their use. On the other hand, Bitcoin is one of the many cryptocurrencies that exist today, standing out for being the most recognized and valuable in the cryptocurrency market and which has given fame and served as an impetus for the growth and development of this revolutionary financial asset.

2. What is blockchain?

The blockchain is a technology that represents a ledger where all operations linked to the creation or transaction of cryptocurrencies that occur in the world are recorded and stored safely and reliably. It works through a distributed computer network, that is, it does not require a central server that only stores the information. 

This feature prevents any attempt at fraud, since to alter the information linked to a transaction, it is not enough to modify the information on a single server, but it is necessary to instantly change the data on multiple computers that make up the network and store the information of a transaction, making it difficult for any hacker who wants to alter the system, providing great protection and confidence to the user.

3. How can I buy bitcoins in Mexico?

To buy bitcoins in Mexico safely and easily, it is best to use one of the various online platforms and pages that operate with bitcoins and other cryptocurrencies, popularly known as exchanges. Thus, an exchange or virtual exchange house will facilitate the experience of operating with these assets in exchange for a commission for its service.

4. How much is a Bitcoin worth?

Answering the question of how much a bitcoin is worth is complex, since its price is defined by the law of supply and demand in the market, that is, its value is variable and responds to the interest that people have in acquiring this financial instrument. In this way, the price of bitcoin will be valued to a greater or lesser extent based on the acceptance and trust it achieves in people over time.

5. How can I protect my cryptocurrencies?

As with physical money, protecting your digital money is very important and you should take it into consideration if you want to be part of this market. In this case, it will be useful to acquire a digital wallet, where you can safely store and manage the cryptocurrencies you decide to acquire and protect them from fraud attempts or cyber attacks.

6. Is it profitable to invest in cryptocurrencies?

Investing in cryptocurrencies is one of the most popular forms of investment today and its popularity seems to be justified. For example, in 2010, a man made the first real transaction of bitcoins by exchanging units of this renowned digital currency for two pizzas, equivalent at that time to an amount of real money close to 40 dollars. Since then, its value has varied exponentially.  

However, you should not forget that the price of Bitcoin or any other type of cryptocurrency has a highly volatile value, so this instrument does not guarantee that past results will be repeated in the immediate future.

7. El Salvador, the first country in the world to legalize bitcoin

One of the most relevant news in relation to the world of cryptocurrencies took place in 2021, with the announcement by the president of El Salvador, Nayib Bukele, to recognize bitcoin as legal tender with the so-called Bitcoin Law. This news only confirms the advancement of cryptocurrencies as a valid means of exchanging value between people and it would not be surprising if other countries joined this initiative in the future.

As you can see, this alternative is added to the various investment instruments available, but you must know the essential points, inform yourself, and be willing to assume the risk that investing money in cryptocurrencies entails.