As an increasingly popular digital currency, Bitcoin may seem unfamiliar and complicated to many beginners. This article provides an easy-to-follow guide to Bitcoin for the average user in Taiwan, from basic concepts to how to buy, store, and trade Bitcoin, and walks you step-by-step through the world of cryptocurrency, which is full of opportunities and challenges. Whether you're new to Bitcoin or already have some knowledge of it, this article will provide you with valuable and practical advice.
What is Bitcoin?
Bitcoin is a decentralized digital currency created in 2009 by a person or group named Satoshi Nakamoto. Instead of being issued by a government like traditional money, it is managed through a technology called blockchain. This means that Bitcoin is not controlled by any centralized organization and every transaction is transparently and permanently recorded in the blockchain. This feature has made Bitcoin a de-trusted currency system and has attracted a large number of investors and users.
Unlike traditional fiat currencies (e.g., Taiwan Dollar, US Dollar, etc.), Bitcoin does not rely on physical currency or metal resources for backing. It is generated through digital computing and cryptography and can be traded globally.
How to start buying Bitcoin?
For newbies, the first step in buying Bitcoin is to choose a suitable cryptocurrency exchange. Some common exchanges include Taiwan's CoinSafe and Euronext, which support both desktop deposits and Bitcoin trading. When choosing an exchange, you need to pay attention to factors such as the security of the platform, transaction fees, and user ratings.
Once registered, you will be required to undergo identity verification, which will increase the security of your transactions and comply with relevant regulations. After that, you can make deposits and then make Bitcoin purchases through commonly used payment methods in Taiwan, such as bank transfers or credit cards.
Payment Methods and Exchange Options:
- OKX Exchange: Supports Taiwanese users to buy Bitcoin directly in NTD and offers multiple payment methods.
- Binance: One of the largest cryptocurrency exchanges in the world with good liquidity for more experienced users.
Bitcoin Wallet: How to safely store Bitcoin?
After purchasing Bitcoins, the next step is to choose how to store them. There are two main ways to store Bitcoins: hot wallets (Internet wallets) and cold wallets (hardware wallets).
Hot wallets are wallets that are connected to the Internet, usually in the form of a cell phone or computer application, and are suitable for daily transactions. Cold wallets, on the other hand, are a form of offline storage, usually in the form of a hardware device, which is suitable for keeping large quantities of Bitcoins for long periods of time and are more secure.
For most regular users who only invest small amounts and make occasional trades, using a hot wallet will suffice. Exchanges such as CoinSafe and Euronext offer built-in wallet functionality that allows you to manage your Bitcoin directly from the platform.
If you plan to hold Bitcoin for the long term, then consider using a cold wallet such as Trezor or Ledger, which are hardware wallets, for added security.
How to trade Bitcoin?
Once you own Bitcoins, you can choose to trade or transfer them. Trading refers to selling or buying Bitcoins on the cryptocurrency market in order to earn a spread. Generally, exchanges offer both limit orders and market orders.
- limit orderIt means that you set a price and the trade will only be executed when the market price reaches that level.
- Market Price ListThe transaction will be made at the prevailing market price and the transaction will be completed immediately.
In addition to buying and selling Bitcoin, it is also possible to make Bitcoin transfers, which are transfers of Bitcoin from one wallet to another. These transactions involve a transaction fee, but are usually cheaper and faster than traditional bank transfers.
Proposed use of the Exchange:
- When you make a trade, pay attention to the handling fee for each trade. Most exchanges charge a fee, which varies depending on the volume of the trade and the payment method.
- If you plan to hold Bitcoin for a long time and avoid frequent trading, choosing an exchange with low fees will work in your favor.
Bitcoin Risks and Investment Advice
Despite the potential of Bitcoin, investing in Bitcoin comes with a high level of risk. The price of Bitcoin is extremely volatile, sometimes rising or falling dramatically in just a few days. Therefore, it is very important for the average investor to invest rationally.
It is advisable to understand the basics of the market and the risks involved before investing in Bitcoin, and to ensure that you only invest with funds that you can afford to lose. Investors holding Bitcoin for the long term may consider investing in a fixed amount on a regular basis to minimize the risks associated with price fluctuations.
For beginners, it's important not to trust unsubstantiated investment advice and to protect yourself from scams. The safety of your Bitcoin investment depends on your choice of trading platform, wallet protection and understanding of the market.
How to earn passive income through Bitcoin?
Aside from simply buying and selling Bitcoin, there are a number of ways to earn passive income through Bitcoin. Here are some common ways:
- Bitcoin Deposit Interest: Some platforms (such as BlockFi) offer Bitcoin deposit interest services where you can deposit Bitcoin and earn interest.
- Pledging Bitcoin: Some exchanges allow users to pledge Bitcoin for additional earnings in a manner similar to a time deposit.
However, it is important to note that these services usually involve a certain degree of risk, and it is important to conduct sufficient research when choosing a platform to avoid encountering fraud.
Conclusion: The Future and Opportunities of Bitcoin
Bitcoin is more than just a currency, it represents a whole new financial ecosystem. As more people understand and accept Bitcoin, it is likely to become more popular in the future. For the average user, learning how to securely buy, store and trade Bitcoin will be the first step into the world of digital currency.
Although the Bitcoin market is still full of uncertainty, it undoubtedly offers great potential for investors who dare to take risks and seek new opportunities. As long as one remains rational and learns, ordinary people can find their own path to success in this field.
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