You’ve probably heard about Bitcoin mining stocks. They’ve been in the news for quite some time – ever since Bitcoin was placed on the stock market for public trading. Although there were some hiccups at first, these stocks are back on the market and anyone who wants to can purchase them. Why buy stock in Bitcoin? And what exactly is Bitcoin anyway? These are some of the questions that we’re going to clear up here.
What is Bitcoin?
Before you purchase Bitcoin mining stocks, it probably helps to understand exactly what Bitcoin is. It’s a form of money that’s called a cryptocurrency. These cryptocurrencies came about because their inventors felt that there was a need for a currency that doesn’t have a country attached to it. For example, there are U.S. Dollars, the Euro, the British Pound, and so on. These currencies are backed up by the countries that they originate from. But it’s declared to be legal tender, but it is not backed by a physical commodity. The value of fiat money is derived from the relationship between supply and demand rather than the value of the material from which the money is made. They also have a physical form. You can hold a U.S. dollar in your hand.
Cryptocurrencies don’t have this. They are completely digital. If you went out to the store to spend your Bitcoin, you’d have to have it hooked up to a debit card of sorts so that the money could be converted and spent. You’d also have to find a store that accepted Bitcoin, but that is becoming less and less of an issue all of the time, as it gains traction with the general public.
Also, in order to obtain Bitcoin, you have three choices. You can mine for it, assuming that you have a computer that’s powerful enough and that you have the know-how, or you can purchase it in the form of stock/bitcoin trust, or you can purchase it on a crypto exchange or trading platform. The latter option is the easiest. Bitcoin mining stocks are available on the standard U.S. Stock Exchange/Nasdaq
Where Can You Purchase Bitcoin Mining Stocks?
As mentioned above, Bitcoin mining stocks are available on the NY stock exchange and the Nasdaq. You just need to find a stockbroker who is willing to help you make the purchase, and you’ll need enough money to invest in this cryptocurrency. If you pull up the latest stock exchange data, you’ll see that standard Bitcoin mining stock is trending fairly high. There are also several different types of Bitcoin stocks on the market, which can make it a bit tricky. For example, you’ll see Bitcoin USD (U.S. dollars), Bitcoin EUR (Euros), and then two versions that look the same, but are different – Bitcoin Cash USD and Bitcoin Cash EUR. These latter two are offshoots of the original Bitcoin.
Bitcoin Cash (both versions) are set up to make Bitcoin a bit more user-friendly for people who wanted to spend it like a traditional currency. Rather than make the company accepting the money wait for days for the transaction to process, the developers came up with a solution called a “hard fork.” They updated the Bitcoin software and created Bitcoin Cash. Now you can buy both versions – the original and the new cash version on the crypto exchange or in a bitcoin trust if you are a credited investor on the Nasdaq.
Why Buy Stock in Bitcoin?
This is the real question. Why would anyone want to buy Bitcoin mining stocks? After all, it’s a cryptocurrency, meaning that it’s not really insured or backed by anything. You can’t hold a Bitcoin in your hand since it’s completely digital and exists only as a series of numbers and computer code. What’s the big deal?
The big deal is that these Bitcoin mining stocks are worth quite a bit of money. Since Bitcoin first went live on the U.S. (and world) Stock Exchange, the price per unit (one Bitcoin, for the record) has skyrocketed. People don’t think that it will go back down anytime soon, especially since there are a finite amount of Bitcoins out there. Mining for them has gotten a bit tougher, and there are more people trying to do it since it’s become quite popular. Look at it this way, cryptocurrency was once something that only the hardcore computer experts knew a lot about. That’s changed since the advent of Bitcoin.
On top of this, a number of other cryptocurrencies have followed Bitcoin onto the stock exchanges, making them something to watch. The popularity of them is only growing, so you need to buy in while the price is still affordable.
In addition, there’s something cool about having a cryptocurrency in your stock portfolio. It’s always good to diversify your holdings, and buying Bitcoin mining stocks are one way to do this. You can have a stock portfolio full of traditional stocks and bonds, and then throw Bitcoin into the mix. You never know when the price will go up, making that cryptocurrency stock one of the pricier things that you own. Purchasing stocks are one way to get a foothold in the cryptocurrency market.