Is it safe to invest in bitcoins today? It could be, but keep in mind that, like all other financial instruments, Bitcoins are also not risk-free.
In fact, not all that glitters is gold and even investing in Bitcoin involves risks.
Note that anyone who wants to invest in Bitcoin without incurring scams, must first learn to recognize and avoid them.
What better way, then, if not to invest knowing what you are doing, thanks to our study?
Here you will find all the tips and tricks on how to invest in Bitcoin, paying particular attention to scams. We will speak in a simple way to make it understandable to all traders.
One of the risks that we talked about reported is that the price of Bitcoin does not rise or fall steadily and one must always keep in mind that there may be times when it is very volatile.
Is investing in Bitcoin safe? How to recognize scams?
In this regard, we can say that one of the first risks related to Bitcoin is to incur a scam.
Bitcoin has also become famous in a short time as a method of getting rich and making easy money.
Here is the first mistake, it cannot be considered this way! It should not be considered only as a speculative instrument, but as a real investment, as a serious professional investment tool.
Moreover, like any investment tool, there is no quick and fast way to get rich. In this case, many scammers have ridden the wave and have started to create miraculous systems, such as Bitcoin Code, which is nothing more than an instrument capable of making you lose money and not becoming rich in 7 days with a small investment, as they claim.
This is nothing more than a scam. We advise you to stay away and invest in Bitcoin only with online trading brokers who are safe and honest.
Bitcoin is not a scam, but it is also not a method of making easy money. Never believe in the promises of easy money! In most cases, these are scams.
That’s why we always recommend to invest with online trading brokers that are safe, reliable and honest, such as those regulated and offered by our guides.
Our advice is to use only CFD trading platforms for your Bitcoin investment that are authorized and regulated.
An example would be IQ Option, as well as eToro. The latter has developed a platform where you can buy bitcoins and other cryptocurrencies without CFDs, so in this case you will proceed to the direct purchase of BTC or other cryptocurrencies. This platform is eTorox, the cryptocurrency exchange of the eToro Group, which was licensed by the Gibraltar Financial Services Commission, (the Gibraltar financial market supervisor).
Is investing in Bitcoin safe? Risk related to the exchanges
At this point, once clarified that it is advisable to buy Bitcoin only with regulated and authorized trading brokers, we can proceed to analyze another system: how to buy on exchanges.
Keep in mind that this tool is not always an excellent method, as it should not be considered as a good idea.
You have to know that there are dangers related to exchanges which can be different and have very negative consequences.
For example, it could happen that exchanges are very often not authorized and regulated.
In this case, they cannot provide any type of guarantee to the investor.
Here, for example, we can make everyone aware of the history of the exchanges that have failed, bringing with them millions of euros of traders who have trusted them.
In short, they can also be considered as real scams to the detriment of customers.
One of the most famous was that of Mt. Gox which, in 2014, made the enormous amount of 850,000 Bitcoins disappear (more than 12 million dollars at the current value value).
Today we can say that, even if it’s not true for all the exchanges, they are scams, as things have not changed, indeed, they have worsened a lot because the scams have become smarter.
Today we must warn you that the world of cryptocurrencies is studded with Exchange scam. We advised all those who invest in Bitcoin with exchanges to use only those who have obtained good reviews.
Even those few exchanges that can be considered effective, as well as honest apply very high commissions and therefore are not suitable for those who want to invest in Bitcoin.
Finally, please note that they are extremely uncomfortable to use and complex for those with no experience.
On the contrary, CFD platforms can be used to buy Bitcoins, which we believe are much simpler to use even for beginners and, as we have always said, are authorized and regulated and this assumes that they are subject to control by the authorities, so they can’t fool customers and .
One of these is the IQ Option platform, a real jewel of technology and ease of use.
Can we think that Bitcoin will always go up?
A mistake that must not be underestimated at all.
Bitcoin had a truly exponential growth in 2017, but in 2018 the price plummeted.
Therefore, consider that Bitcoin is a financial asset, which can have collapses like all the others.
In fact, there is no asset in the world which always goes up.
So if you decide to invest in Bitcoin, do it with awareness and try to understand what the future price movement may be.
Especially, never trust fraudulent brokers!
So how to avoid this risk?
You just have to choose CFD platforms to invest in Bitcoin, as there are traders who work with Bitcoin and invest by always buying upwards (they always buy).
This is why, moreover, you should also choose only CFD platforms that hold Bitcoin as an asset.
Price drops, for many smart traders, can also be considered as excellent tools to earn.
All you have to do is to know how to take advantage.
Not knowing what Bitcoin is (and how it works) is a mistake that you don’t have to make
Unfortunately, many go into Bitcoin trading without even knowing what Bitcoin is.
This is particularly due to the fact that they have heard that they can make a lot of money, but they don’t know well what they are and how they work.
These people don’t waste time, they do a quick Google search and start right away.
Maybe the first thing they find is a scam, like Bitcoin Code and they get robbed.
Before investing, we always recommend that you spend at least a few hours studying what Bitcoin is, how it works and how you can invest.
Why investing in Bitcoin with CFDs
At this point, let’s try to understand why investing in Bitcoin with CFDs is worthwhile.
Keep in mind that, so far, we have talked about the risks associated with Bitcoin trading and we have also mentioned the fact that the best way to avoid scams is to use the CFD platforms.
So what does CFD trading mean?
Keep in mind that CFD trading presupposes the possibility of investing with CFDs, or Contracts for Difference, which are nothing more than a financial contract envisaged by European legislation and, therefore, subject to the supervision of the competent authorities.
That’s why all CFD trading platforms must be authorized and regulated, and as such they must have prior authorization, in order to also comply with the very strict European regulations for the protection of investors.
Here is also that the CFD contract on Bitcoin has the same price as Bitcoin, as it reflects it in all its parts.
CFDs can be used to buy Bitcoin (speculate upwards) or sell Bitcoin (speculate downwards).
Finally, consider that the advantages of CFDs suitable for buying Bitcoins are numerous, such as:
- No commissions;
- No scams if you choose regulated brokers;
- Simple to use;
- Possibility of earning (and losing) both upwards and downwards.
That’s also why all traders that we can consider as smart investors only use CFDs to speculate on Bitcoins.
In this regard, we remind you that IQ Option offers basic and advanced courses that explain step by step how to invest in online trading.
It is also possible to have free telephone support and also contact an account manager through a free demo account and get feedback with an online trading expert.
Investing in Bitcoin with eToro
eToro is truly an exceptional online trading broker. A platform very simple and very appreciated by all traders who want to invest in Bitcoin.
eToro is a platform that offers a completely free, reliable, honest investment tool. Its platform is also very simple to use. It doesn’t matter that you are not an experienced trader. Even those who have never made absolutely any type of financial investment or with cryptocurrencies.
Consider also that the most interesting aspect of eToro is the possibility of copying, even completely automatically and without costs, all the best subscribers on the platform.
How does eToro work?
To know how eToro works we must say that the broker offers the first social trading platform in the world, which can be better described as a mix of:
- a standard platform to invest in the markets;
- a social network, like Facebook for example.
Consider that, if you choose to invest with eToro, you can have a public profile, even with photos.
This allows you to share ideas and also interact with other members.
On these profiles, however, there is also information on the profits made by the investor in the past. On the basis of these data it is also possible to copy, with a simple click, all the operations that are carried out.
For example, many novice investors are looking for investors who have made more money in the past. However, these begin to copy them automatically without knowing anything about online trading.
In this way they can immediately get profits but, above all, they can begin to learn how to invest in Bitcoin, other cryptocurrencies or traditional assets.
On the other hand, if you take into consideration the fact that it offers a simple platform and the ability to automatically copy others, it is often possible to consider how the platform chosen by the less expert of Bitcoin is this one.
This is also why many traders want to sign up, but also to give consent for other members to copy.
In short, eToro can be defined as an excellent free platform, which generously rewards professional investors or those we can define as the best, based on the number of followers.
These rewards are added to normal profits coming from investments.
Moreover, all professional investors have all interest in giving consent to be copied, but also to accumulate as many copiers as possible.
So you can use eToro absolutely free. You can also choose the demo mode in order to experience the platform and get to know how it works.
Note that the demo account is useful in order to understand how the social trading works, before making a deposit.
If instead you want to invest with a real account, then you can make a deposit by credit card, bank transfer, Paypal (or other electronic payment systems)..
It is true that bitcoin is a huge bubble?
We still cannot say it with certainty, but we can certainly tell you that it is a high risk investment.
This is also due in particular to the fact that behind Bitcoin, today, there is no one except a frenzy of savers from around the world.
Their value is determined only by how much people are willing to pay in order to get one and how much traders expect people to be willing to pay in the future.
High returns = high risk
For this reason, from such high returns, we certainly cannot expect forms of investment that are not to be considered as highly risky.
For example, from traders who want to try new forms of speculation, even to small investors tickled by the prospect of easy and particularly high returns, bitcoin presents itself as a very attractive investment.
Can we then define Bitcoi as the “alternative” virtual money?
At this point you cannot avoid to consider the risks associated with a financial operator or a private entity that converts and organizes transactions in Bitcoin.
That’s why, in our opinion, the first thing to do as always is to look for information on what they are and how to invest with them.
Furthermore, an abusive exercise of the reserved financial activity involves a criminal offense.
So the risk for operators who purchase, create and convert these cryptocurrencies can be to replicate typical models of the financial market, as well as of the payment system, which are nothing but a reserved activity, to incur in the same legislative and regulatory areas.
In this regard, we also recommend keeping the ICO, or ‘initial coin offering‘, which remembers the name and procedure of the IPO, under close observation.
In this case, tokens are offered in the market, i.e. digital instruments that incorporate rights, with the aim of obtaining capital in the form of cryptocurrencies.
At this point, we also remember that qualifying the alternative currency as a financial product could lead to risks for the consumer, which can be considered as the same as those related to any form of investment of a financial product, such as a share.
That’s why a good financial education is fundamental.
At this point we also remember that for consumers there may also be surprises regarding a possible hacker attack, as well as the disappearance of money from their virtual wallet.
Although considered rare, new and sometimes small savers must know them.
The ideal thing, in our opinion, would be that the coin came out of the mesh of the network and went on the street, among the shops.
Even if the ICO market, as is precisely the Bitcoin market, currently has all the symptoms of a bubble, which has also been recognized by several investment banks, there is always the underlying innovation that could turn into a massive shift of platforms in the digital world.
On the other hand, today the opinion on the subject of the EBA, the European Banking Authority, remains lapidary. It states:
“The risks identified outweigh the possible benefits that virtual currencies could provide to their users, even considering the advantages in terms of costs and transaction times”.
Investing in Bitcoin: risks and avantages
Now, thanks to this guide, you too have been able to pay particular attention to Bitcoin trading and the risk connected to them.
Note also that the investment in Bitcoin can be profitable, but only if you operate intelligently, always keeping the risks under strict control.
So here is that a good CFD platform, as well as awareness of what Bitcoins are, and the risks associated with them, are a good introductory course that can really make a difference.
Remember that it is not mandatory at all to invest in Bitcoin!
However, many invest in Bitcoin simply because friends and relatives do it and earn money.
Not all of them know that it is not as simple as they want us to believe. It is not easy to invest in digital currencies and earn with cryptocurrencies.
If you want you can always try to operate on Bitcoin in demo mode.
We always recommend it! On the other hand, you can use and exploit the great advantages offered by CFD trading platforms, that allow you to simulate the investment without any type of risk.
When you realize you are earning with the demo account, then you can decide to make a deposit and start trading with real money.
Investing in Bitcoin is a risk like all other financial investments, the risk here becomes higher since it is not an asset regulated by the European authorities.
Being an unregulated asset, it can help to trade with brokers with a European license. In fact, these brokers must follow European regulations and are considered more reliable. Often these brokers offer CFD trading on bitcoins.
CFD trading allows you to buy and sell Bitcoins without owning the asset directly. In this case, in fact, the trader is only investing in the rise or fall in the price of the cryptocurrency.