Bitcoin is a type of cryptocurrency and it is also considered as a commodity instead of currency. Those who are trading in bitcoins they buy and sell bitcoin and are making a good profit every day with different methods.
Bitcoin is legal in many countries of the world except for a few who are working on a mechanism to regularize the bitcoins trading in their system. Major companies also accept online payments through bitcoin wallets just like PayPal or credit card payments.
How to Get Bitcoin?
When bitcoin was introduced, it was easy to obtain bitcoin at first by mining. Mining refers to a process in which miners use their computers to solve complex mathematical expressions to crack the codes.
When they do that successfully, they get a reward in the form of bitcoin. But now mining is difficult as there is very high competition due to the popularity of bitcoins and you also need powerful computers for mining.
Getting profit by selling and buying bitcoins is a business now that has changed the life of many people. Those who wanted to start making a profit with the bitcoins can use PayPal or other payment methods to buy bitcoins. If you don’t know about the process then here you can learn how to buy bitcoin with PayPal.
Buying and selling of bitcoins work something like shares. Like in the share market, you buy shares of any commodity and then wait for some time so that value of the share increase and you can sell those shares at a high price to make a profit.
The same is the case with bitcoin. You buy bitcoin with PayPal or through any other means and then you hold the bitcoins in your digital wallet. When you see that now you can sell the bitcoin at a higher price as compared to the price at which you bought, you sell the bitcoin. This is called bitcoin trading.
In this way, you will be able to make a profit if you sell at the right time. But just like shares, the risk involved in bitcoin trading as well. If you buy at a specific price and after that price goes down, you could lose your money as well.
Sometimes you would need to hold for a long time when the price is decreasing and you wait for the price to rise again. When you see the rise, you can again sell the bitcoin. But if the price keeps going down you could lose all your bitcoins as well.
Short Term Trading
In short-term trading or we can say in day trading you don’t hold the coins for a long time. After noticing a small increase in the price you sell your bitcoin. At the end of the day, with multiple successful trades, you can make a reasonable profit in short term trading.
Long Term Trading
Whereas in long-term trading; you should have a good experience and detailed study of the price trend. If you are good at it then you know exactly for how much time you can hold your bitcoins and can sell at a much higher price. In this trading, you can earn more profit but you are at risk as well.
Another way to buy and sell bitcoin for profit is arbitrage trading. Arbitrage trading is a financial process in which you buy and sell the commodity at the same time.
You buy the commodity from one market where its price is low and at the same time, you sell that in another market where its price is high. In this way, you can make a quick profit and you can do this by using bitcoins as well.