A cryptocurrency wallet instead of a pension. How to invest in bitcoin for the long term

Experts explained the potential of investing in the first cryptocurrency in the long term, as well as gave recommendations on buying the asset and its storage
Over the past five years alone, bitcoin has grown by more than 7,500%. A $100 investment in the first cryptocurrency in 2016 could yield almost $75,000 in profits. In April of this year, when the price of bitcoin peaked at $64k, the profit could have been more than $105k.

A cryptocurrency wallet instead of a pension. How to invest in bitcoin for the long term

The choice is justified


At the moment, bitcoin is one of the most promising assets for long-term investments, says the director of the service for the exchange of cryptocurrencies Alfacash. According to him, investors are attracted by the cryptocurrency's limited issuance amid the negative impact of quantitative easing on fiat.

"Bitcoin's appeal is enhanced by the digitalization of the payments market and support from large companies like Tesla," the expert said.

Bitcoin is still a very young asset with a promising future, Currency.com, a financial analyst at the cryptocurrency exchange, believes. He believes that the deflationary model, as well as the ever-increasing demand for bitcoin will lead to an increase in its value in the future.

How to invest in bitcoin


It looks most profitable to buy the first cryptocurrency during the "cryptozyma" period, the expert explained. According to him, "cryptozyma" comes after bitcoin realizes the growth potential on the background of halving. During such periods, the value of the asset decreases to the minimum marks. The last "cryptozyma" was observed in 2018. Then bitcoin was down to $3,000 after rising to $20,000 at the end of 2017.

Halving is a halving of the reward for a mined block that occurs every four years. Initially miners received 50 bitcoins, that number dropped to 25 coins in 2012 and 12.5 coins in 2016. On May 11, 2020, it dropped to 6.25 bitcoins. Halving occurs every 210,000 blocks mined. The next halving is scheduled for 2024

If there isn't a lot of capital to invest, you can buy your first cryptocurrency on a monthly basis for small amounts.

"Every month you can save $10-$100 in bitcoin. After 10-15 years, the capital will be solid," explained the financial analyst of the cryptocurrency exchange Currency.com.

If you have substantial capital, you can buy bitcoin during corrections, as it is better to enter the asset as quickly as possible.

Long-term cryptocurrency storage


If the goal is to invest with the prospect of several years, rather than stock speculation, the ideal option would be to withdraw bitcoin to a "cold" wallet. The director of the cryptocurrency exchange service Alfacash agreed with him, adding that "cold" wallets exclude the possibility of stealing coins through the network.

"Hot" wallets are those that have a permanent connection to the Internet. Such wallets are used if there is a need for frequent transactions. "Cold" wallets store cryptocurrency without an internet connection, so there is virtually no risk of hacking.

Experts named a few security rules when storing bitcoin:


"Cold" wallet should be connected to the Internet as rarely as possible and only to update the blockchain;
Split the seed phrase that is used to restore access to the wallet into several parts;
Store the seed phrase in several different places and have a printed copy of it;
Do not spread the word about the availability of cryptocurrency, the amount of it, or how it is stored.
FX24

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