As the world of cryptocurrency continues to evolve, Bitcoin remains the most popular crypto due to its accessibility and growing use in the mainstream market. And with so many new and interesting ways to earn Bitcoin, you may wonder how you can get involved.
In this article, we’ll dive into the basics of Bitcoin and share methods for earning and storing it.
What Is Bitcoin?
Created in 2009 by an unknown founder, Bitcoin is the first and most valuable cryptocurrency. It allows for digital and decentralized transactions to take place around the world through what is known as the blockchain.
There are a few key terms associated with bitcoin. First, “decentralized” simply means that two parties can negotiate only with each other, rather than using a centralized exchange. (A community bank, for example, would be a centralized entity.)
Bitcoin is created through a process called “mining.” When a bitcoin is mined, complex mathematical computer puzzles are solved, and the miner responsible for the successful solution adds a new block of Bitcoin to the blockchain and receives a reward in return.
Finally, the blockchain is what keeps track of all bitcoins in existence and the transactions of bitcoins that occur. It is a continuously growing list of records that is impossible to alter without others noticing, lending to the security associated with Bitcoin.
How Does Bitcoin Get Its Value?
At the time of this writing, one bitcoin is worth $41,995.50. The intrinsic value of Bitcoin is similar to any other currency: When demand exceeds supply, the value goes up.
Bitcoin’s extreme volatility compared to other currencies is due to it still being more investment-based than transactional.
A bitcoin holder is more likely to trade or invest their assets rather than, say, buy a pizza with it. Even so, more companies are beginning to accept Bitcoin as an acceptable form of payment.
Another way that the value of Bitcoin is different from traditional currency is that its worth is dependent on how many coins are mined that people are willing to sell.
Media coverage has helped elevate its perceived worth and contributed to its peak value of about $64,000.
How To Purchase Bitcoin
The good news about buying Bitcoin is that it is easier today than it has ever been, and it doesn’t necessarily have to break the bank.
Instead of spending over $40,000 on one bitcoin, you can purchase parts of a bitcoin or, in some cases, earn bitcoin on the bitcoin that has already been bought.
Purchasing Bitcoin Online
Buying it online is one of the quickest and easiest ways to get your hands on Bitcoin. Cryptocurrency exchange websites are becoming more popular, so interested buyers don’t have to settle on the first available option.
Once you’ve chosen an exchange and created an account, you can choose how to purchase Bitcoin.
Some exchanges require government-issued currency to be placed into an account, but other platforms allow transactions using credit and debit cards. Keep in mind that many sites that allow cards will charge a transaction fee.
When choosing an exchange, check to see whether the platform offers a digital wallet with the purchase of cryptocurrency, if they have an app for convenience, what their fees are, and if they offer reliable customer support.
Purchasing Bitcoin In Person
For those who don’t want to buy Bitcoin online, the cryptocurrency can also be purchased in person with cash.
Websites like LocalBitcoins exist to connect crypto sellers and buyers, but the additional privacy often comes with a slightly higher rate.
Bitcoin ATMs are also beginning to pop up in more places around the world and work much like a regular ATM. If not having an account connected to your bitcoin transactions is appealing, it’s worth noting that these machines charge anywhere between a 5%-10% transaction fee.
Ways To Earn Bitcoin
Get Paid In Bitcoin
It might sound far-fetched, but the future is now. Getting paid in Bitcoin is gaining traction, especially in the freelance community. If a worker is determining their own rate and also has a client willing to pay in Bitcoin, the right deal can be made.
An important thing to remember is that being paid in a specified number of bitcoins (or any cryptocurrency) means accepting that payment regardless of its volatility.
If, for example, a job pays half of a bitcoin, that could end up leaving you with $30,000 or $15,000 depending on the market.
Earn Interest On Bitcoin
Earning interest on Bitcoin has also become increasingly popular recently. You can earn interest on your cryptocurrency simply by storing it in certain accounts. Finding the right company to start an account with is the best way to make the most of your earnings.
At Vauld, we offer some of the highest rates for earning interest on Bitcoin. And with Vauld, you can also access competitive borrowing and trading features that can’t be found elsewhere.
Mine For Bitcoin
Like we mentioned above, mining for bitcoins is what keeps the cryptocurrency in circulation. Another benefit of mining is that a current rate of 6.25 bitcoins is awarded to the miner that adds another block to the blockchain.
Using Bitcoin’s current value, that’s a $272,970.75 payment.
But before you start investing in expensive software and brushing up on math, you should know there is one major downside to Bitcoin mining: The number of miners far outweighs the number of blocks to be mined, and bitcoins are only earned for a successful addition to the blockchain.
That being said, the benefit is that even if a miner faces failure after failure, it only takes one successful mine to make it all worth it. It’s a lot of work, but it comes with the potential for a lot of reward.
Earn From Bitcoin Faucets
Perhaps the best way to earn Bitcoin with the least amount of work is through a Bitcoin faucet. These websites and apps offer small amounts of Bitcoin as payment for completing small, usually menial tasks.
Watching ads, completing online puzzles and captchas, or viewing product videos are a few common jobs that Bitcoin faucets have users fulfill in return for portions of bitcoins known as satoshi.
It might be easy, but expect the bare minimum. Extremely low risk means extremely low reward.
Storing Bitcoin Properly
Once you’ve figured out how to earn Bitcoin, you’ll need to determine how you’re going to store it. In one way or another, you’re going to need a wallet.
Hot And Cold Bitcoin Wallets
Hot and cold wallets provide a solution for both those looking to keep their earnings online and those who want to keep their bitcoins as far away from the internet as possible.
A hot wallet is a web-based crypto wallet. Although hot wallets are seamless and easy to use on your phone or desktop, they can be prone to hacking in rare cases. If you’re storing crypto with a fintech, make sure they have thorough safety measures in place to protect your assets.
Cold wallets are the opposite. These storage methods are not connected to the Internet and instead require pins and passwords to access your crypto, making it more difficult to steal.
Custodial And Non-Custodial Wallets
Custodial wallets are usually hot wallets that allow another party to control the keys that access your tokens. Using a custodial wallet means trusting a third party to protect your earnings.
Non-custodial wallets, on the other hand, let the Bitcoin holder maintain full control of their key. This grants the owner complete responsibility of their assets, making the process completely decentralized.
Are You Ready To Earn Bitcoin?
When it comes to earning and storing Bitcoin, there are enough options to satisfy everyone from the beginner to the expert. Knowing the different ways to buy and earn Bitcoin can help make the process easier, but each comes with its own risks.
Whether you’re trading with someone, earning Bitcoin through a faucet, or thinking about which wallet to store your assets in, be sure to research and ask questions.
Partnering with Vauld grants you access to a long list of features that allow you to make the most of your Bitcoin, including our Crypto Circle to discuss cryptocurrency topics such as global adoption and upcoming tokens.
With Vauld, you can also create a safe and secure crypto wallet in 10 minutes. Creating your wallet with Vauld lets you store multiple types of tokens without requiring private keys.