A Short Survival Guide For Bitcoin Buyers In 2020 And Beyond
The essential rules that people who want to buy Bitcoins in 2020 must follow.
The year 2020 promises a lot for Bitcoin. If you read me regularly, you must have understood that the Halving of Bitcoin expected in May 2020, the upcoming economic crisis and political uncertainties both in the United States and globally will provide ideal conditions for the price of Bitcoin to rise sharply in 2020 and beyond.
The End Of 2017 Must Be Remembered
This probable increase in the price of Bitcoin will naturally be accompanied by a significant influx of new people into the market who will seek to make big profits.
This arrival can be a good thing provided that these people do not make the same mistakes again as those made at the end of 2017.
The madness, which had taken hold of the Bitcoin and cryptocurrency markets, had given rise to a speculative bubble whose explosion plunged the market into a prolonged bear cycle throughout 2018.
In order to prevent the same causes from producing the same disastrous effects in 2020, I propose a short survival guide for people who want to buy some Bitcoins. If you are a Bitcoiner, this article will not necessarily teach you new things but you can take the opportunity to share it with people you know who want to buy Bitcoins for the first time in 2020.
Rule #1: Discover What Bitcoin Really Is
Too many people come to the Bitcoin market without even bothering to discover what Bitcoin really is. These people simply consider Bitcoin as a new and highly performing asset that should not be neglected.
This attitude, strictly limited to the investment side, causes many people to miss the essential thing about Bitcoin.
Bitcoin has seen its price increase from less than $1 to nearly $7,500 over the past decade. Even better, its price reached an all-time high of $20,000 at the end of 2017.
All these figures are phenomenal and make traders dizzy in the world of traditional finance. However, these figures do not reflect the revolutionary side of Bitcoin.
No growth figure in its price is really enough to reflect what Bitcoin can bring to the world in the future.
If you decide to buy Bitcoins, you must first and foremost discover how Bitcoin is building a more equitable monetary system for everyone.
You need to understand why the current monetary and financial system is flawed and not fixable. Once you are aware of all this, you will be able to understand that Bitcoin goes far beyond a simple investment.
Rule #2: Take The Time To Learn How Bitcoin Works
Once you have discovered what Bitcoin really is and why it represents a unique opportunity for a fairer world in the future, I strongly advise you to go further.
You must take the time to learn how Bitcoin works.
For this, nothing beats reading the original white paper of the Bitcoin published in 2009 by Satoshi Nakamoto. Entitled “A Peer-to-Peer Electronic Cash System”, this document provides a complete overview of how the Bitcoin Blockchain works internally.
By reading this document, you will first understand exactly how transactions are linked to each other within blocks. You will then discover how the blocks are timestamped before being linked together in an immutable way.
The document then presents the basis of the consensus algorithm used by the Blockchain Bitcoin: the famous Proof-of-Work which is at the centre of the entire mining process.
The notion of reward for miners validating a block of transactions is also detailed and explained by the need to incentive people to participate in the Bitcoin network by making their computing power available to secure it.
The networking of the Bitcoin system is also precisely defined and makes it possible to understand why nodes consider the longest transaction chain as the one that is correct and should be extended.
Finally, Satoshi Nakamoto’s white paper discusses the need to make all transactions on the Bitcoin Blockchain public in order to do without a trusted third party as is the case in traditional payment systems.
Reading this white paper is essential because it will give you the technical basics to understand in detail how the Bitcoin Blockchain works while giving you all the key concepts to know and then do possible in-depth research on certain topics.
Rule #3: Do Not Be Greed With Bitcoin
The phenomenal success of Bitcoin over the past decade has made heads turn. Thus, the number of people who hope to become millionaires with Bitcoin is still high. As I explained earlier, these people miss the essential point with this attitude.
Bitcoin often reveals itself mercilessly to people who come to it only out of greed.
The end of 2017 will have been a perfect example of what I have just written. Indeed, how many people came to buy Bitcoins guided only by their greed and then disenchanted and lost almost everything?
A very large number of people have experienced such misadventures. Some have been scammed by believing in miracles sold by unscrupulous people. Others have lost everything by forgetting to secure their Bitcoins. Finally, some people simply capitulated, which led to an even faster bursting of the speculative bubble that had been created around Bitcoin at the end of 2017.
In any case, you should never fall into the trap of greed with Bitcoin. Never forget also that the number one rule in investment is also involved in Bitcoin:
“Never invest money that you can not afford to lose.”
Rule #4: Make Your Buying Decisions Alone
Bitcoin is still very young and its market remains ultra volatile. Thus, when prices fluctuate significantly, upwards or downwards, social networks tend to get carried away. If you are not careful, you may be contaminated by a FOMO (Fear Of Missing Out) feeling.
The FOMO feeling will push you to make bad choices when buying Bitcoins. You must avoid it at all costs.
The best advice I can give you is to buy Bitcoins based only on your instincts.
Do not follow the advice of others. Make your own opinion after analyzing the market and make your decision, which will necessarily be the right one since it is yours and you will be ready to assume the consequences.
If you can’t ignore what is being said about Bitcoin on social networks, all you have to do is disconnect your Twitter or Facebook account so that you don’t get polluted by the mass effects that develop there when the Bitcoin market gets out of control.
Rule #5: Do Not Be Emotional When Buying Bitcoins
Whatever investment you make, you must ensure that you never act emotionally. The latter is often a bad advisor. You must make your own decisions in a rational way. If you are tired, postpone your buying or sellig decisions.
The buying or saling of Bitcoins must follow a very specific personal strategy.
You can buy some Bitcoins because you want to invest and make a profit. You can buy some Bitcoins because you believe in the revolution it embodies and want to join the HODLERS camp. In any case, whatever your choice, do it in full awareness without giving in to your emotions.
You will make better choices by sticking to your guidelines and remaining rational in all situations.
Rule #6: Secure Your Bitcoins In A Hardware Wallet
By following the first rules of this little survival guide in the Bitcoin world to the letter, you have become aware of how your Bitcoins are secured with a public / private key system.
You will therefore understand the following sentence that often comes up in the world of Bitcoin:
“Not your keys, not your Bitcoins.”
So, when you store Bitcoins on an exchange platform such as Coinbase or Binance, your Bitcoins do not really belong to you because they are not secured with your keys.
The unfortunate experiences of hacking into trading platforms that have marked the history of Bitcoin should encourage you to take the safety of your precious Bitcoins very seriously.
To secure your Bitcoins, there is nothing better than storing them in a hardware wallet such as the Ledger Nano S or the Trezor One.
In any case, the essential rule to remember is never to keep your Bitcoins on an exchange platform longer than necessary.
Rule #7: Be Patient And Play Long-Term With Bitcoin
The last rule is essential if you are going to buy Bitcoins for the first time in 2020. You must be aware that Bitcoin is building a more equitable monetary and financial system for the future. It takes time to build the future.
Bitcoin is here to stay, so you have to be patient when playing in the long term.
Don’t make the mistake of spending your time monitoring the price of Bitcoin all the time. Once you have bought your Bitcoins, put them in a safe place and think long-term.
Adopt the Bitcoin HODLERS strategy which has proven to be the best strategy 90 percent of the time. Be patient and become Bitcoiners by believing in creating a better world in which Bitcoin will be at the centre in the future.
The coming year promises to be an exceptional one for Bitcoin. If you are already a Bitcoiner, nothing beats a little reminder of the rules of survival in the merciless world of Bitcoin. If you are a new investor who wants to buy your first Bitcoins in 2020, the little survival guide I have just presented will allow you to take your first steps in this world with full knowledge of the facts.
I hope in this way that you will understand why Bitcoin is a revolution for tomorrow’s world and above all that you will be able to avoid the main traps into which a large majority of new investors fall mainly because of ignorance and greed.
With Bitcoin, the following maxim is even truer:
“What you do not know costs you money.”
So don’t remain in ignorance with Bitcoin and always seek to deepen your knowledge.