Investing in bitcoin from India
A step by step guide to cut through the noise and help you get started.
If you follow technology, news and investing in general, chances are high you must have come across several articles talking about Cryptocurrencies and bitcoins in particular.
With the interest in Bitcoin surging with every passing day( just like its value, it has risen 7000% since 2011), more and more people are sitting on the fence waiting to get started and deep dive into the world of CryptoCurrency.
How many times have you come across facts like:
As the saying goes:
“The best time to buy bitcoin was 8 years ago. The second best time is now”
If you are completely new in the world of crypto, it is highly recommended to familiarize oneself with a top level understanding before getting into trading.
Wikipedia defines bitcoin as:
Bitcoin is a worldwide cryptocurrency and digital payment system called the first decentralized digital currency, as the system works without a central repository or single administrator. It was invented by an unknown person or group of people under the name Satoshi Nakamoto and released as open-source software in 2009.The system is peer-to-peer, and transactions take place between users directly, without an intermediary.These transactions are verified by network nodes and recorded in a public distributed ledger called a blockchain.
The most important piece to know is bitcoins or any other cryptocurrency works without a middle man( regulatory body like your bank) being involved and every transaction is recorded and verified in a publicly distributed network( Blockchain)
Is it still hard to understand what the heck is a bitcoin and why people are going gaga?
You can follow the below links to get an in depth understanding in the most basic way possible:
Now that you are aware of what the hype is about when it comes to bitcoins and Cryptocurrencies, it may be a good time to get your hands dirty.
As you read this, one bitcoin is roughly INR 5L( ~$7637)
The first thing that comes to mind seeing this number for most people is, I can’t spend 5L(~$7637) to invest into something that may give me high returns or lose the entire investment.
Did someone tell you that you can start by investing as low as INR 1000($ 15.27)?
Most of the people get stuck when it comes to deciding which is the simplest way to get started.
Let’s make your life easy :)
When you are looking to buy bitcoins( Satoshi’s) someone should sell it.
This means you need a trading platform.
Everything that you might have heard when it comes to platforms( Coinbase, Unocoin, Zebpay etc) are basically trading platforms through which you can buy/sell bitcoins and other cryptocurrencies.
Second thing to know(again easy to understand) is just like you do your bank transactions wherein you need to have a bank account and other person’s account to do any transaction, similarly with Bitcoins the first thing you need to do anything is to have an account, which in the crypto world is your wallet address.
Below is how you can create your own Bitcoin wallet address( akin to a Bank account)
Just like you can choose the organization you want to bank with( HDFC, Axis, ICICI etc) you have the choice to go to any platform and create an address( Unocoin, Zebpay etc).
Let us run you through the process on Zebpay( Download the app from Google Play or App Store)
Within 24 hours you are ready to make your first bitcoin transaction.
In the real world terms which we are familiar with, you can co relate it with having a Bank account( the details such as bank name, IFSC, Branch etc are with you) and you are ready to fund your account or do a transaction to other bank accounts.
In this case: You will have an address in your profile section which is something like
Your address is ready, now let’s finally buy some bitcoins(satoshis)
Before pressing the buy button on top, your account needs to have sufficient balance.
You can fund your account using the deposit button.
Let’s add INR 1000 or 10,000 and then buy bitcoins of the same value( Yes, you can do that)
Your account is loaded, you have an address and no one can stop you from owning bitcoins or satoshis from here on B-)
Let’s press the buy bitcoin
Congratulations you own your first bitcoins!
Because you may not own 1 bitcoin( right away), in real terms you have 2037336 Satoshis :)
Zebpay would also allow you to keep a track on how the market is moving with respect to bitcoin price so that you can buy more or sell accordingly.
Let us end this with a few notes that are important to know especially since you now have a headstart in the world of cryptocurrencies:
- We took bank’s example to help explain the process. The whole bitcoin/cryptocurrency is built on removing middlemen/organizations(bank) who control your current financial transactions. You will know more as you keep digging deeper.
- You will be served better if you don’t treat this as get rich quick scheme. Rather if you treat this as an instrument that may take over the world some day( if everything goes well) and you want to have a piece of the pie when that happens
- Finally, the best way to look into this is to think of having made an investment( and may be some more) into a new technology and a chance to know/understand more of how the system works. Beyond all the hype.
If you want to know more ,follow us as we come out with a series highlighting every aspect of investing in bitcoin and Cryptocurrency.
Drafted with love by Nagesh Bansal and Prashant Sharma
PS: We are not investment advisors( whatever we detailed above is based on our experience), it is only you who will always be responsible for every investment you do. We are also not associated with Zebpay in anyway and used it as demonstration here as it is easy to understand.