Is Bitcoin A Good Investment & Should I Invest In Bitcoin?

Bitcoin Investing Explained: Should I Invest In Bitcoin? Is Bitcoin A Good Investment?

Last Updated July 23rd 2021
26 Min Read

If you are new to the world of Bitcoin investing, you might be wondering if Bitcoin is a good investment, and should I invest in Bitcoin? Well, let’s cut through all the Bitcoin-related myths online to help you consider if investing in Bitcoin is a good idea!

But first, what do we know about Bitcoin - one of the most popular search words ever?

Bitcoin, often seen as a safe haven, is a digital asset that has revolutionised the whole world. Created in 2009 by the mysterious figure of Satoshi Nakamoto, Bitcoin has become a luring alternative to banking and traditional payment systems.

If you are wondering if Bitcoin is a good investment and asking yourself if you should invest in Bitcoin, just think about it! Bitcoin is a decentralised digital payment platform that is not ruled by governments or financial authorities. 

Can you imagine having transparency and security without dodgy fees and secret intentions - just you having control over your own money?!

No surprise that the hype around Bitcoin has led to the creation of thousands of altcoins, and in over more than a decade, crypto investing has conquered the world.

Though forex is still the largest financial market, we have to agree that cryptos are popular trading and investing aspects, especially in the world of crypto day trading.

But is Bitcoin just a passing storm or is it here to stay? As Stephen McKeon, associate professor of finance at the University of Oregon, said, “The question has moved from ‘will this survive’ to ‘how big will this get?’”

If you want to invest in Bitcoin (BTC) easily and quickly with 0% Commission, you can just straight into eToro Exchange

In This Guide, We Will Cover:

So, is it worth investing in Bitcoin in the years to come? Let’s find out!

Can You Really Make Money From Bitcoin?

You most certainly can make money from Bitcoin. A lot of people have already done so already - hence the huge rush to buy more!

Many people buy Bitcoin just to speculate with it. They don’t spend it or use it for anything important. They’re holding it waiting for its value to continue rising.

According to Shaurya Malwa of Decrypt, up to 17% of Bitcoin’s supply hasn’t moved in seven years. Highly suggesting a large chunk of crypto holders plan to sell when the price reaches new highs.

Is Bitcoin a Good Investment?

As Bitcoin is the largest Cryptocurrency market cap, many traders believe Bitcoin is a good investment compared to other cryptos. Despite all the ups and downs in Bitcoin’s history, experts believe that Bitcoin price could grow further in the long term.

While it’s up to traders to decide if Bitcoin is a good investment, let’s explore more of its pros and cons to create a comprehensive and objective picture.

Bitcoin is the oldest and one of the most traded cryptocurrencies, with one BTC trading at $41,839.25 at the time of writing, as per CoinMarketCap.

BTC price chart

Source: coinmarketcap.com

With a 24-hour trading volume of $117,465,812,547 and a market cap of $782,203,240,256, Bitcoin is the top traded cryptocurrency across the globe.

Because of its limited supply of 21,000,000 BTC and mining constraints, Bitcoin is one of the most desired assets in the crypto world.

Just like gold, investing in Bitcoin is seen as a safe haven; it is a popular financial venture with low correlation with other assets (for example, stocks) and high liquidity.

On top of that, Bitcoin is a great way to diversify one’s portfolio and reduce exposure to risks, especially in times of financial turmoil, such as the ongoing coronavirus pandemic.

At the same time, investing in Bitcoin and other cryptocurrencies can be risky due to the high volatility of the market. 

In 2017, Bitcoin reached a record high of almost $20,000 per one BTC but went down to $4,000 in 2018.

2019 was a year of recovery and Bitcoin solidifying its position. But in the back of many people’s minds, there was a worry that all could be lost.

Then came 2020 and momentarily those precious gains were lost in March when the pandemic happened. But that all started to turn around in late 2020 when Bitcoin finally found its way back to $20k.

And 2021 so far has been one of the most exciting years to date, reaching a high of $60k but then sinking temporarily to $30k (almost entirely down to one particular billionaire - more on that later!).

Would you consider investing in BTC?

What will Bitcoin be worth in 2025?

Bitcoin could be worth as much as $550,482 by December 2025, according to Cryptocurrency Price Prediction.

Do note though that reaching $500k is very bullish and most price forecasters for Bitcoin seem to suggest that it will be between $100k and $200k.

And that fits in pretty nicely with the whole ‘Bitcoin laser eyes till 100k’ thing on Twitter, where many Bitcoin enthusiasts have given their profiles laser eyes until Bitcoin reaches that point.

WalletInvestor and Coin Price Forecast have the closest predictions for 2025, both seem to believe $180k is realistic.

Coin Price Forecast estimates that Bitcoin will reach $184,612 by mid-2025, but then close the year slightly lower at $166,665.

WalletInvestor forecasts a maximum price of $180,954 for Bitcoin by December 2025.

DigitalCoin also sees Bitcoin breaking past $100k, but at a slightly lower price. It forecasts that Bitcoin could reach $136,256.03 by September 2021.

The lowest forecast is by The Economy Forecast Agency which foresees Bitcoin reaching $89,210 at the highest in June 2025. Even if this is the case, it’s still pretty good.

A key thing to note about price forecasting websites is that they can drastically change their predictions based on current price drops or rises. Because of this, it can be hard to assess how realistic their forecasts are.

What will Bitcoin be worth in 2030?

Bitcoin could be worth up to $1,570,037 per coin by 2030, according to Cryptocurrency Price Prediction, at the most extreme end. Elsewhere, Coin Price Forecast sees BTC breaking the $200k barrier to $200,378.

A lot can happen in the next decade, so it would not be wise to make trading goals based on price predictions for 2030. Instead, do your own research and come up with more achievable goals.

What will Bitcoin be worth in 2040?

Bitcoin could be worth up to $10 billion by 2040 with a market capitalisation of $200,000 trillion according to a report (page 2) by crypto consulting company SwissRex AG.

This prediction surpasses the popular prediction that Bitcoin will eventually replace gold, taking with it its market cap of approximately $11 trillion.

Remember that predictions can change very dramatically over a few years. Because of this, predictions for 2040 will likely be incorrect.

Read Also: Bitcoin Price Prediction for 2025 and 2030

Should I Invest in Bitcoin?

Given the volatility of Bitcoin, many people wonder if Bitcoin is a good investment and if they should invest in it. 

Should I Invest in Bitcoin then? Yes and No!

The truth is that even if Bitcoin is a good investment, that doesn’t mean you should start investing today. Cryptocurrency trading is not a game, but a serious financial business. 

Before you get started, do your own research, invest in trading education, and choose a reputable broker like eToro. Consider potential risks and develop a crypto trading strategy that may help you increase your wealth over time. Learn from the best in the field!

If you are interested in the decentralisation of currencies and their potential to replace traditional banking, then Bitcoin is for you. After all, Bitcoin was created as an alternative to traditional payment systems and bureaucracy.

On the other hand, if you are more interested in blockchain technology and the way it can facilitate the use of smart contracts and decentralised apps, then you might prefer to invest in other cryptocurrencies, such as Ethereum or EOS.

In the end, depending on your goals and resources, you can invest short-, mid- or long-term in Bitcoin and diversify your portfolio.

Has anyone got rich from Bitcoin?

A lot of people have gotten rich from Bitcoin. At least 100,000 people have become millionaires from investing in Bitcoin, according to Stephen Gandel of CBS News.

When you think about it, it isn’t surprising that many people have become rich considering Bitcoin’s ungodly price increase since its creation.

Erik Finman was one of the first success stories that hooked media attention. He is often considered the youngest Bitcoin millionaire.

He became a Bitcoin millionaire by the age of 18 after investing $1,000 in Bitcoin in 2011 aged just 12 years old. He is believed to own approximately 431 BTC and is worth over $4.8 million, according to Rebecca Aydin of The Business of Business.

The Winklevoss brothers also invested heavily in Bitcoin after their payout from Facebook. They have since founded the Gemini exchange, the 14th largest exchange.

Satoshi Nakamoto owns the most Bitcoin - approximately 1 million BTC, 1/21 of all the entire supply that will ever exist. It would be worth approximately $40,266,500,000.00. If he is still alive, he would by far be the most successful person from Bitcoin.

And if that’s not enough evidence for you to hold on to your BTC supply, you might not have heard of Laszlo Hanyecz who in 2010 paid 10,000 BTC for two Papa John’s pizzas.

Back then, BTC was worth pennies, but during Bitcoin’s surge to $60k in 2021, it would have meant those two pizzas cost up to $613 million!

Just goes to show how holding on for the long run with crypto can really pay off!

Does Bitcoin go up when the stock market goes down?

No, there is no clear link between Bitcoin going up and the stock market going down, or vice versa.

In late 2020, both the stock market and crypto market climbed significantly. One does not seem to prevent the other from succeeding. If this theory was correct, Bitcoin’s rise to $60k would have slammed the stock market.

Created a little more than 10 years ago, Bitcoin has perhaps not been around long enough to see if there is any truth in that statement.

It is perhaps correlation, not causation. When the stock market crashes, many traders look to move their funds to safer assets that will not decline in value. Historically, this has been gold.

However, more recently many traders are starting to view Bitcoin as a better store of value than gold.

Interestingly, despite all the money printing in the last few years, the value of gold has largely stayed the same. This suggests that traders are putting their money somewhere else.

Bitcoin is seen as a better alternative because it has a fixed limit, 21 million. Meanwhile, no one is certain how much gold there really is left.

And so, what we are starting to see is when the stock market starts looking shaky, traders are rushing to buy Bitcoin and this demand can increase the price of Bitcoin.

Bitcoin itself is not dragging down the stock market; an uncertain stock market is forcing traders to Bitcoin.

Should I Invest in Bitcoin or Altcoins Instead?

So, should you invest in Bitcoin or should you explore other coins then?

Before we explore the potentials and risks of investing in other coins, let’s not forget that Bitcoin is the first virtual coin ever, which has led to the creation of other coins or alternatives to Bitcoin, hence called altcoins.

Some altcoins, such as Ethereum, Ripple, Tezos, and EOS, come with some impressive capabilities.

Take Ethereum – one of the most popular investment options – for example! Ethereum is the second most traded coin out there that can support smart contracts and decentralised apps

There are many more undervalued coins with great potential that might explode in the future, too. Some cryptos like BAT may be used to improve not only payments and legal processes but digital advertising and content creation.

That said, smaller cryptos can be even more volatile than Bitcoin, so one has to be cautious, especially when it comes to Initial Coin Offerings (ICOs) and potentially fraudulent activities.

But in the end, you don’t need to invest in Bitcoin or other cryptos to diversify your portfolio at all. With hundreds of trading markets such as equities and commodities to invest in, it’s all up to you to decide if investing in Bitcoin is worth it.

Read More:

Bitcoin Price Predictions

Most Important Cryptocurrencies Other Than Bitcoin

Is Investing in Bitcoin Risky?

Given the uncertainty around Bitcoin and its prices in the future, investing in Bitcoin, like any asset, can be risky. Though some believe in its positive growth in the long-term, it’s almost impossible to predict if investing in Bitcoin can be profitable.

Without an in-depth understanding of the crypto world and the factors that affect Bitcoin investing, investing in Bitcoin can be risky.

That’s why, if you decide to buy and sell Bitcoin or trade Contracts for Difference (CFDs), always invest in an adequate education, practice, risk management, and self-discipline.

If done properly, your high-risk ventures can lead to high rewards.

Do not forget that crypto investing is not gambling, so never invest more than you can lose. It’s recommended to start small with minor BTC increments. The good news is that you can start trading cryptocurrency with as little as $100.

It’s worth noting that one of the main risks in trading is falling victim to intense emotions, overconfidence, stress, and greed.

That’s why emotional self-control and self-discipline are two of the key factors to success in the world of Bitcoin investing.

Why do Banks Hate Bitcoin?

Not all banks hate Bitcoin! Certainly, at the beginning, many banks were very frightened of Bitcoin because it meant cutting them out of the world of finance, but now many banks are starting to embrace Bitcoin and other cryptos.

Some banks, particularly central banks that are in charge of printing money and implementing monetary policy, show a lot of concern.

But many commercial banks have done a U-turn in the last few years, experimenting with blockchain technology and even offering products and services related to cryptocurrency.

JPMorgan is an example of a big commercial bank that has done just that. Back in 2017, the bank’s CEO and chairman, Jamie Dimon, said he would fire any traders he found trading Bitcoin.

Fast forward to 2021 and things are very different. They’re now offering wealthy clients a managed Bitcoin fund.

On top of that, JPMorgan is launching their own cryptocurrency, called the JPM coin, a stablecoin pegged to the US dollar.

They also believe that Bitcoin could reach a price of $130,000 in the long term.

Can You Lose Money on Bitcoin?

Yes, you can certainly lose money on Bitcoin if you sell at a lower price than you paid for.

However, in the long-term, Bitcoin has grown in price substantially over the years.

This is why many traders who have Bitcoin don’t day trade it. Instead, they ‘hodl’ it until the time is right. Until it reaches a point where there is no way they will lose money.

That said, Bitcoin is not a surefire investment. Don’t expect that it will just keep going up and up forever.

Here’s a useful tip for you: If you have bought Bitcoin and you stress out a lot about the price of it, it’s a sign that you have invested too much in it.

It should not stress you out that much. Whatever you do, do not invest money you need to live.

What Happens to Bitcoin if the Dollar Crashes?

If the US dollar crashes, we might see more people rushing to buy Bitcoin to prevent huge losses. In turn, this could pump up the value of Bitcoin to new highs.

With all the printing happening right now around the world because of the coronavirus, this is a very real possibility.

According to City A.M. in October 2020, approximately a fifth (20%) of all US dollars were printed in 2020.

Furthermore, US president Biden is currently trying to pass through the government a very large infrastructure bill ($2 trillion) that goes into the trillions of dollars.

While he may have good intentions, this bill could further sink the price of the dollar as it will mean printing more money.

What Caused Bitcoin to Crash?

Bitcoin crashed because Elon Musk announced that Tesla would no longer accept Bitcoin as a payment method. Bitcoin lost around half of its value in a few days, dropping from near $60k to $30k.

Musk cited that the energy required to mine Bitcoin was bad for the environment. He’s not the first person to say this. Many have mentioned the damage before, and it is a legitimate concern.

And, of course, it’s not good for the image of an electric car company to be investing in a technology that damages the environment.

According to a study by The University of Cambridge, Bitcoin mining consumes 121.36 terawatt-hours a year, which is more than the energy consumption of Argentina, a country of 44.94 million people.

However, the issue is not so much about how much power Bitcoin consumes, it’s about where that power comes from, which in most places around the world, is not renewable.

According to C2ES, in 2018 only 26.2% of the world’s energy generation came from renewable sources.

But no one is talking about the power consumption of the current financial system we have. Specifically, the financial businesses that rely on being ‘middlemen’.

According to a thread on Reddit, Bitcoin uses ¼ of the current financial system and supposedly “78% of Bitcoin’s Electricity Usage is from renewables”.

Bitcoin has crashed several times in the past and shouldn’t be seen as a major scare anymore.

But crashes should not be viewed in a negative light! Many crypto traders look at crashes with pure glee! It’s a chance to buy more at a cheaper rate.

Of course, this is only wise if you really believe that the price of Bitcoin will recover. And let’s face it, though Musk’s dumping of Bitcoin has done a fair bit of damage, it’s not going to stop people from using it.

Who Should Include Bitcoin in Their Portfolios?

If Bitcoin’s future seems bright, who can exactly benefit from investing in Bitcoin?

Well, investing in Bitcoin can be a wonderful trading option for day traders who want to benefit from price swings and multiple small trades during a single day. 

Bitcoin can be also suitable for mid- and long-term investors who want to hold cryptocurrency.

Interestingly enough, according to Cointelegraph, hodling is one of the most profitable strategies and those who buy and hold Bitcoin usually profit 95.4% of the time.

Of course, investing in Bitcoin can benefit more traditional traders who simply seek portfolio diversification, as well as blockchain enthusiasts who believe in the future of Bitcoin and cryptocurrency technologies.

Let’s not forget that blockchain technology has potential far beyond the financial sectors and can improve areas, such as gaming, voting, and medicine.

How much would I have if I invested $1,000 in Bitcoin?

If you invested $1,000 in Bitcoin right now, you would have approximately 0.025 BTC, at the time of writing. Depending on when you invested, of course, that amount could vary significantly.

Using DQYDJ’s Bitcoin return calculator, if you invested $1,000 in Bitcoin in July 2010, accounting for inflation, in May 2021 it would be worth $7,042,151,362.63. A total return of 70421413.626%.

Getting Started With Bitcoin Investing

investing in bitcoin

So, now you know some interesting facts about investing in Bitcoin, you can tell us what you think. Would you invest in Bitcoin?

If you’ve made up your mind and decided to invest in Bitcoin, then you’re lucky to have today’s online tools and multiple resources at your disposal. 

While investing in Bitcoin early was hard and reserved mainly for miners, now you can easily buy and sell cryptocurrency and trade CFDs.

All you need is to find a reliable exchange like eToro, open and fund your account, and start your crypto journey.

Here we should mention that there are different methods to dive into the world of Bitcoin investing. One can buy and hold Bitcoin or trade it. It’s not a secret that a popular trading method is to trade CFDs; CFDs allow people to open long and short positions and use leverage.

Just remember to choose a safe and reliable platform! As Bitcoin hacks, such as the notorious Mt Gox attack, still happen every so often, make sure to keep your assets secure and learn how to recognise scams.

With eToro, for example, one can safely invest in Bitcoin and over 90 crypto pairs to trade.

eToro – The Best Cryptocurrency Platform For Both Traders and Investors

etoro broker

eToro have proven themselves trustworthy within the industry over many years – we recommend you try them out.

How much do you need to invest in Bitcoin to make money?

0.001 BTC is all you need to make money with Bitcoin due to its limited supply cap, says Marcel Pechman of Cointelegraph. At the time of writing, 0.001 BTC equals approximately $40.05.

In another Cointelegraph article by Marcel Pechman, he further explains that the market cap of gold is approximately $11 trillion. It’s the same theory the Winklevoss brothers believe in.

So, if Bitcoin replaces gold, we could be seeing an increase in price 11 times. Hence why just owning as much as 0.01 BTC could pay off big time in the future.

For the time being though, Bitcoin at its highest has only eclipsed $1 trillion.

But there are other more logical ways to invest in Bitcoin. The most logical thing to do is to only invest 1%-2% of your portfolio in BTC. This is a top rule that many successful traders follow.

For example, if you have $1,000 you want to invest. Only invest a maximum of $10 to $20 on each trade.

This is a highly effective trading strategy because it reduces risk. If you lose money on one trade, you can still make 99 more. And if you do well, you can increase what you have available to trade.

On top of that, you can also diversify that $1,000 too. There is no need to invest it all in Bitcoin. It would actually be much wiser to invest some of it in other cryptocurrencies, stocks and other tradeable assets.

Again, this reduces risk. If the price of Bitcoin plummets, you will not lose everything you have to invest.

So, in the end, the amount of money you should invest in Bitcoin is entirely down to your financial situation.

Conclusion: Should You Invest In Bitcoin? 

Investing in Bitcoin - or any kind of investing - can be very risky if you don’t know what you’re doing, especially during uncertain times.

You may be asking yourself, “should I buy Bitcoin right now?” So, here’s a tidbit, investing your money doesn’t have to be complicated.

While no investment is risk-free, investing in Bitcoin has generated about 40% return over the last two years.

Whether you’re new to Bitcoin investing or just curious about how to make the most of your investment, understanding what to know before investing in Bitcoin is critical.

In the end, the final decision comes down to you. What kind of investor do you want to be? Figure out the answer to that question, you’ll definitely know if Bitcoin is a good investment!

Would you invest in Bitcoin or other digital assets? 

If you enjoyed reading our article Is Bitcoin A Good Investment & Should I Invest In Bitcoin, please share it with anyone who might be interested in Bitcoin.

Key points

If you learned anything from Is Bitcoin A Good Investment & Should I Invest In Bitcoin? make it these key points.

  • Investing in Bitcoin could be an excellent investment. Bitcoin could be worth as much as $550,482 by December 2025.
  • There are approximately 100,000 Bitcoin millionaires today. And banks that were once aggressive now offer Bitcoin investing services.
  • Bitcoin can still crash but will likely recover. Most recently Tesla dropped BTC as a payment method.
  • Pundits suggest owning 0.01 BTC might be enough to become rich if Bitcoin replaces gold. That said, it would not be wise to invest more than 1%-2% of your portfolio on BTC.

Further Reading: 

Ethereum Vs. Bitcoin

15 Reasons Why You Should Invest in Bitcoin Today

Top 10 Cryptocurrencies To Invest In 2021

How Does Bitcoin Mining Work?

Bitcoin Investment - FAQ

Here are some FAQs if you still have questions about investing in Bitcoin!

How would Bitcoin react to a recession?

Bitcoin will likely serve its purpose as a safe haven asset in a recession with many traders and investors looking to put their money in BTC until the economy recovers.

However, how Bitcoin will react to recession is largely unknown because Bitcoin was created after the last global recession of 2007-9. In fact, Bitcoin was created in response to that recession.

Though Nakamoto wanted to find a solution to that financial crisis, it looks like Bitcoin won’t really make the situation any better the next time around.

Bitcoin won’t prevent another crisis from happening or prevent governments from bailing out banks that practice risky and unethical financial activities.

How Bitcoin would react perhaps depends on how integrated Bitcoin is with the world economy. The more integrated, the more damage a recession could do to the price of Bitcoin. But this is all purely speculation.

Is It Worth Investing In Bitcoin?

Considering Bitcoin’s 100,000,000% ROI and the fact it beats all other assets, including gold, stocks, and oil in the last 10 years, yes, Bitcoin is definitely worth considering.

Just remember never to invest more than you can afford to lose and only buy Bitcoin from a safe, reliable trading platform like eToro.

Can I buy less than 1 Bitcoin?

Yes, you can buy less than 1 Bitcoin. Bitcoin is broken down into ‘satoshis’ with 1 BTC equalling 100,000,000 satoshis (100 million).

Brokers and exchanges may have limits on how small you can purchase Bitcoin. You may not be able to buy less than 0.001 or 0.002 BTC, for example, which equates to about $80.

(When you think about Bitcoin in these kinds of denominations, it’s not so expensive after all.)

Is it safe to invest in Bitcoin?

Investing in Bitcoin is a risky and, at the same time, potentially high-reward financial venture.

Though nobody can guarantee that Bitcoin is a safe investment, you can invest in trading education, practice, and self-discipline to increase your chances of success.

How many Bitcoins are left?

Approximately 2,286,300 Bitcoins are left from a total supply of 21 million. The current circulating supply of Bitcoin is 18,713,700.00 BTC.

It should be noted that the amount of newly created Bitcoin is slowly declining. Every four years Bitcoin goes through a halvening (or halving) where the reward for mining a new block is halved.

This happened in 2016 and is believed to have had a big impact on the 2017 bull run. The same thing happened again in 2020 and 2021.

According to Investopedia, the last Bitcoin will likely be mined by 2140. By that point Bitcoin will become a fixed supply of 21 million and no new coins will be created.

Is it smart to invest in Bitcoin?

Investing in Bitcoin and cryptocurrency is a smart way to diversify your portfolio, hedge against inflation, and support the decentralisation of payments. 

Investing in Bitcoin has always proven smart. Bitcoin is also an extremely smart investment for those that are looking to hedge against inflation in the dollar and other fiat currencies. 

One of the smartest ways to start investing in Bitcoin is to choose a safe platform like eToro that allows you to buy and sell assets and trade CFDs of over 90 pairs.

Are you taxed on Bitcoin?

You may have to pay capital gains tax depending on where you live if you hold or sell Bitcoin. So, make sure you research what your country’s laws are on cryptocurrency taxes.

In the UK for example, holding Bitcoin is not taxable, but once you make a profit or trade BTC for another crypto, you may have to pay capital gains tax.

Some countries are creative in how they tax crypto. In Zug, Switzerland you can actually pay your taxes in Bitcoin or Ethereum.

However, tax related to income from cryptocurrencies is still a very grey area in most places around the world and in some countries, there are no laws on crypto ownership and tax.

Cryptocurrency no longer is outside the financial system so don’t expect by owning it the tax agency will never find out! It’s much wiser to pay your taxes than end up in jail and lose it all!

Is Bitcoin going to crash?

Even though nobody can predict the future of cryptocurrency, historical data shows that Bitcoin has gone through many ups and downs but has always managed to overcome financial and social turmoil, such as the ongoing coronavirus pandemic.

Interestingly, many experts are positive about the future of Bitcoin and believe it may outperform gold.

Does Warren Buffett have Bitcoin?

Warren Buffett is a well-known critic of Bitcoin and said in February 2020 that “I don’t own any cryptocurrency and I never will”. So no, Buffett probably does not have any Bitcoin.

His partner, Charlie Munger, has also called Bitcoin “disgusting” (pretty strong wording) and “bad for the environment”.

Do note that the two men - despite their immense experience in trading and finance - are very old. Buffett will turn 91 in August. Munger is 97!

And so, it is quite likely that we shouldn’t take them too seriously. Most likely they do not fully understand what Bitcoin is and how beneficial it could be.

They don’t seem to understand that the value of cryptocurrency is not made out of thin air and there are numerous other benefits to its use. Reading their comments, it often feels like listening to an elderly person talk about Bitcoin 10 years ago.

That said, Buffett has said that he sees the benefits of blockchain technology.

Who gets the money when you buy Bitcoin?

When you buy Bitcoin from an exchange, the person on the other side of the trade (the person you are buying from) will get your money.

If the exchange is a centralised exchange, they will also take a small percentage for themselves. Miners also get a small percentage for facilitating the transaction.

Can I transfer Bitcoin to PayPal?

Yes, you can transfer Bitcoin to your PayPal wallet from another wallet. In the last six months, PayPal has increasingly worked towards adding more cryptocurrency-related services.

Most recently, in April 2021, it was announced that PayPal would now allow users to pay merchants with crypto too.

They even allow traders to buy Bitcoin through PayPal too, though supposedly, you do not own the Bitcoin you buy through them.

Can I transfer Bitcoin to my bank account?

Yes, several cryptocurrency exchanges allow users to transfer their Bitcoin to fiat currency in their bank account directly. Coinbase, Bitstamp and Kraken are three exchanges that allow this.

Do note that for the time being, there are no major banks that allow you to store your Bitcoin in your bank account.

That said, several mobile apps allow you to buy and store crypto and also operate like banks.

Disclaimer: Cryptocurrencies are highly volatile. Your capital is at risk and Past performance is not an indication of future results.

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