By Lilian Wamaitha
It has been called the future of finance and its value continues to rise over the years.
You are reading this article because you have been thinking about investing your money in something worthwhile, probably bitcoins but are yet to go ahead.
Like you, the mystery in the air surrounding cryptocurrencies has made it difficult for a majority of Kenyans to take part in the ongoing wealth accumulation.
Since its emergent ten year ago in 2007, thousands of Kenyan have become millionaires just by investing in cryptocurrencies.
This article aims to shed light on the big mystery that is cryptocurrencies.
And now without much further ado, here is all you need to know about investing your money in bitcoins and cryptocurrencies.
What are Bitcoins?
This is a currency that is designed to pay for goods and services just like your traditional Kenyan shilling.
However, Bitcoin is not regulated by any government, it is completely digital and is anonymous, that is, it is tied to your wallet ID (will discuss this shortly) rather than your personal information.
The reason why so many people are drawn to Bitcoin is the lack of middle men and banks that charge hefty fees.
Is Bitcoins & Crypto-currencies A Good Investment
People define a good investment in different ways.
For me, it’s putting your money into use rather than just storing it away somewhere or using it.
We have all been told the value of having an investment, which raises the question of what a good investment really should look like.
Let’s says you have 50,000 shillings in savings, you put it in a bank for a year. You are likely to withdraw the same 50K or with a few thousands on top.
Now how about instead of storing that 50K in the bank, you put it in a business. That same amount is likely to earn you more, right?
Cryptocurrencies are a sort of investment but one that has high returns that any other business.
This is because the value of Bitcoins keeps increasing even in hours.
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What you need to start investing in Bitcoins
Step 1: The first step is to set up your bitcoin wallet, which is an online wallet that is similar to a bank account. Some popular online wallets include blockchain.info/wallet and coinbase.com/signup. All you have to do is sign up for an account. You can still download their mobile apps.
Step 2: Secure your account by noting down you wallet ID and using the security centre to verify your email.
Step 3: Find yourself a broker. Now that you have your wallet ready, you will need to put some bitcoins into it. The role of the broker is to help you get the bitcoins. You will send them money via your credit card or bank transfer and they will send you bitcoins.
Kindly note that you need to be very careful where you are buying your bitcoins. With so many scammers on the web, you need to find a legit broker who deals with bitcoins and trade with them.
Step 4: Start buying Bitcoins now. This can take second or hours. All you require is a bitcoin address which your broker will ask for and you should get your coins in your account.
Step 5: Bitcoin works if you spend or sell it. The good news is that you can sell your bitcoins for cash just like buying them. If you want to, you can use the same broker to sell your bitcoins. There are also a number of international stores that are accepting payment in Bitcoins but this may not be the case in Kenya.
A warning before you invest in Bitcoins
The Central Bank of Kenya governor, Patrick Njoroge has warned that bitcoins might be another pyramid scheme that is in the future likely to leave many Kenyans in losses.
Citybank’s analysts have also warned that Kenyans have accumulated holdings of bitcoins estimated at more than Ksh 163 billion which could cause a widespread disruption of the economy should the cryptocurrency market collapse.
On to you
Now that you have both sides of the tale, it’s up to you to decide if investing in bitcoins is a worthwhile investment. All I know is that, there are people who have already made money from it.
Lilian is a Communication Officer at Career Point Kenya. Got any queries related to crypto-currency trade? Leave a comment below.