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One might consider it a future possibility, a magnificent one at that, that traders would be able to buy stocks in Bitcoin. As of now, no, you cannot buy shares or stocks in Bitcoin. There have been ample instances when early-adopters have earned millions by simply holding the bitcoins in their wallets for Bitcoin continues its bull-run, hovering near the $20,000 mark for the longest time. Several Bitcoin and other cryptocurrency scams have robbed investors of their money, though some awareness campaigns have helped bust such bitcoin myths.
The Curious case of Bitcoin Inc: One such new scam encompasses persuading investors to believe that Bitcoin was some kind of stock released by a corporation, which is blatantly false. Bitcoin comes into existence via bitcoin mining over a blockchain and isn’t introduced by any central agency. This tactic belongs to an elaborate operation started by an organization called Bitcoin Inc. Unsuspecting investors with no knowledge of how a Bitcoin operates might mistake it for the real Bitcoin. The shareholders of Bitcoin Inc. want to give the impression that their organization was behind Bitcoins’ issuance.
The information on their site says there is a “21 million BTC maximum limit and 1000 Bitcoin Inc full corporate shares maximum limit.” Their one corporate share is equivalent to 10 bitcoins. While we all know that the total number of bitcoins is limited to 21 million, the last bitcoin would not be released until 2140. The website calls out to the investor who missed out in 2010 to hold any amount of USDCX fractional shares in their wallet.
The misinformation cited on the website is enough to dissuade any investor from investing any further. But a naive investor can easily fall into the trap. But since Bitcoin is no brand and has no corporation backing, it’s name is perfectly suited for scammers to gauge money from innocent investors by unscrupulous means.
Though Bitcoin shares might be considered a future possibility, despite the perverted scams, there’s a significant hitch in the provision of such a service as a classical stock exchange and a cryptocurrency exchange function quite differently.
Investing in Bitcoin can be highly rewarding and is directly proportional to your appetite for risk. The past decade has seen multiple ways to buy Bitcoin in India and worldwide, with popular cryptocurrency exchanges like WazirX supporting trading in Bitcoin, Bitcoin trusts Like GBTC (Grayscale Bitcoin Investment Trust), Bitcoin derivatives, and even ETFs of Bitcoin-related companies. Let’s dish out some ways of investing in Bitcoins:
Buying coins via a crypto exchange or trading platform
The first and most obvious way is to buy a coin or a fraction of the coin via an online cryptocurrency exchange or crypto trading apps like WazirX. Such apps provide a user-friendly, interactive, and secure interface to purchase Bitcoin and other altcoins.
You can access Bitcoins’s price performance by keeping a tab on India’s Bitcoin live price via such apps. All you need to do is to set up an account on the platform. The platform might require some personal information and KYC, after which you can deposit money and purchase bitcoins. The purchased bitcoins are stored in an encrypted bitcoin wallet assigned to you.
Buying shares of GBTC
Investors wanting to go the capital market route can access Bitcoin investment through the Grayscale Bitcoin Investment Fund (GBTC). Under GBTC, a product that tracks the 1/10th value of a Bitcoin is provided to the investors. For instance, if Bitcoin is valued at USD 10,000, each share of GBTC would have a NAV of USD 1,000. This value includes a 2% fee maintained by GBTC that has an impact on the overall value.
GBTC arranges offline storage mechanisms to allow less technically versed investors to invest safely in Bitcoin. There are certain advantages of holding a GBTC share. Shares of GBTC are eligible to be held in certain IRA, Roth IRA, and other brokerage and investor accounts, allowing easy access to all levels of investors. It provides security, liquidity, and ease of use to the investors.
Investing in Bitcoin Derivatives
Some investors like a more immediate return through Bitcoin trading and like to sell it at the end of a price rally. Once the market moves in their favor, the investor sells off his Bitcoin investment. Such speculative trading for high returns in Bitcoin is based on the Bitcoin market’s high-volatility and is termed a long position.
At other times, the investors might predict the decreasing value of Bitcoin. Investors adopt short positions and sell their bitcoins to buy them at a lower price in the future. This case scenario happens especially during a Bitcoin bubble.
Bitcoin Futures and options are some crypto derivatives that offer the investors the benefit of liquidity and returns without the volatility and risk involved in direct trading. A derivative is a class of financial contracts that derive their value from an underlying entity’s performance, in this case, Bitcoin.
Investing in Bitwise 10 Private Index Fund
Based on the Bitwise 10 large Cap Crypto Index, the Bitwise Private Index Fund is a large-capacity basket. In such a fund, the company attempts to provide the security and ease of a traditional ETF. It requires a minimum investment of USD 25,000 and has a fee ratio of 2.5%. The funds are stored in cold storage, ensuring optimum security to investors.
While investing via any of the above-mentioned channels, the investors must be wary enough to trade via a regulated exchange or body and keep a few considerations in mind. Bitcoin has undergone dramatic fluctuations but can ensure phenomenal returns in the long term as the world sees blockchain technology and cryptocurrencies gaining traction. But for Bitcoin shares, they are non-existent!
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Frequently Asked Questions
How Many Bitcoins Will Ever Be Created?
The source code of Bitcoin stipulates that it must have a restricted and finite quantity. As a result, only 21 million Bitcoins will ever be generated. These Bitcoins are added to the Bitcoin supply at a predetermined rate of one block every ten minutes on average. The supply of Bitcoins will be depleted once miners have unlocked this number of Bitcoins. It's possible, however, that the protocol for Bitcoin will be altered to allow for a higher supply.
How Many Bitcoins Are There?
There are 18,730,931.25 Bitcoins in circulation as of June 2021. The total number of Bitcoins that would ever be there is just 21 million. On average, 144 blocks are mined every day, with 6.25 Bitcoins per block. The average number of new Bitcoins mined every day is 900, calculated by multiplying 144 by 6.25.
How To Convert Bitcoin To Cash?
There are many ways of converting Bitcoin to cash, such as crypto exchanges, Bitcoin ATMs, Bitcoin Debit Cards, Peer to Peer Transactions. You can use cryptocurrency exchanges such as WazirX for this. Unlike typical ATMs, which allow you to withdraw money from your bank account, a Bitcoin ATM is a physical location where you may buy and sell Bitcoins using fiat currency. Several websites provide the option of selling Bitcoin in return for a prepaid debit card that may be used just like a standard debit card. You can sell Bitcoin for cash through a peer-to-peer platform in a faster and more anonymous manner.
Is Bitcoin Legal In India?
In India, Bitcoin is not illegal. Because of cryptocurrency's rapid evolution, policymakers and regulators seemed to have recognized the chance to accept the new technology early. From the infamous 'RBI ban' in 2018 to reports of an impending bill banning cryptos in 2021 that has yet to develop, India has seen its fair share of ups and downs when it comes to Bitcoin regulation. Last year, the Supreme Court Of India approved the use of Bitcoin throughout the country. According to the Supreme Court, the existence of Bitcoin or any other cryptocurrency is unregulated but not unlawful.
What Type Of Currency Is Bitcoin?
Bitcoin is a type of digital currency or cryptocurrency. In January 2009, Bitcoin was established. It's based on Satoshi Nakamoto's ideas, which he laid out in a whitepaper. The name of the individual or people who invented the technology remains unknown.
Is Bitcoin And Cryptocurrency The Same Thing?
Bitcoin is a cryptocurrency that was designed to facilitate cross-border transactions, eliminate government control over transactions, and streamline the entire process without third-party intermediaries. The absence of intermediaries has resulted in a significant reduction in transaction costs. Satoshi Nakamoto, the creator of Bitcoin, created the first cryptocurrency in 2008. It began as open-source software for money transfers. Since then, plenty of cryptocurrencies have emerged, with some focusing on specific fields.
How Does Bitcoin Work?
The blockchain, a distributed digital ledger, is what Bitcoin is based on. As the name suggests, blockchain is a linked database made up of blocks that store information about each transaction, such as the date and time, total amount, buyer and seller, and a unique identifier for each exchange. Entries are linked in chronological order to form a digital blockchain. Entries are linked in chronological order to form a digital blockchain. Blockchain is decentralized, which means any central authority does not control it.
Is Bitcoin Trading Is Legal In India?
In 2020, the Supreme Court of India lifted the RBI’s restrictions on cryptocurrencies. According to the Supreme Court, the existence of Bitcoin or another cryptocurrency is unregulated but not unlawful. The verdict has greatly aided the world of digital money in the country. To put it another way, investing in Bitcoin is perfectly legal, and you may do so through various apps and traders.
Is Bitcoin Safe And Legal In India?
In 2020, the Supreme Court of India lifted the RBI’s restrictions on cryptocurrencies. According to the Supreme Court, the existence of Bitcoin or another cryptocurrency is unregulated but not unlawful. The verdict has greatly aided the world of digital money in the country. To put it another way, investing in Bitcoin is perfectly legal, and you may do so through various apps and traders.
What Is Bitcoin?
Bitcoin is a decentralized digital currency that may be purchased, traded, and traded without intermediary like a bank. Bitcoin is built on the blockchain, which is a distributed digital ledger. Wei Dai suggested a new kind of money that relies on cryptography rather than a central authority to oversee its production and transactions on the cypherpunks mailing list in 1998. Bitcoin was the first application of that notion. In 2009, Satoshi Nakamoto sent out the first Bitcoin specification and proof of concept to a cryptography mailing group.
Disclaimer: Cryptocurrency is not a legal tender and is currently unregulated. Kindly ensure that you undertake sufficient risk assessment when trading cryptocurrencies as they are often subject to high price volatility. The information provided in this section doesn't represent any investment advice or WazirX's official position. WazirX reserves the right in its sole discretion to amend or change this blog post at any time and for any reasons without prior notice.
