Economy
Ultimate Guide To Investing In Bitcoin For Beginners In Nigeria
Bitcoin is a buzzword in the financial world, with its features as a digital asset making it attractive for investors. As Bitcoin is a decentralised asset that uses blockchain technology for its transactions, there is a need for beginner investors to know how to invest in Bitcoin.
The narrative of the advent of cryptocurrencies is incomplete without referring to Bitcoin, the premier crypto asset, on whose innovation other cryptocurrencies emerged. Bitcoin may be the oldest cryptocurrency, but it also leads the pack as the most popular and expensive digital asset in the global crypto market, making it a hotbed of investors.
Bitcoin has gone through a series of timelines for its bearish and bullish prices since its launch in 2009 – notable of which is rallying over an all-time high of over $67,000 in November 2021.
Nonetheless, the coin has remained a toast of many investors in Nigeria, both beginners and experts, who seek to leverage the high price of Bitcoin to make a fortune. The increasing interest in the coin makes Nigeria one of the top countries that highly invest in Bitcoin worldwide. As of the time of writing this article, the price of Bitcoin is over $26,000, with a market cap of approximately $520 billion.
In the sequel to this discourse of Bitcoin investment, it is imperative to understand the intricacies of investing in Bitcoin for beginners to make intelligent decisions.
Why Invest In Bitcoin?
The rationale for investment in Bitcoin is relative to the coin’s features. Here are some of the reasons why people invest in Bitcoin.
1. Diversification
Bitcoin enables investors to diversify their portfolios, as they can invest in the digital asset while investing in other products like Gold, stocks, bonds and whatnot. But because Bitcoin is a decentralised asset not tied to any asset class, it makes the coin a great asset to have and use to hedge against inflation and economic uncertainty.
2. Potential Returns
Volatility is one of the peculiarities of Bitcoin as its price fluctuates. Therefore, you can make a high return on investment when the price is bullish. But you also need to know that you may record losses when the price of Bitcoin tanks.
How To Start Bitcoin Investment
As you have better understood what Bitcoin is and why you may need to consider investing in the coin, let’s delve into how to invest in Bitcoin.
1. Set Up A Bitcoin Wallet
Setting up a Bitcoin wallet is the first smart step to investing in Bitcoin. A Bitcoin wallet is a digital wallet that enables you to receive, store, and send Bitcoin. Depending on your preference, this Bitcoin wallet exists in hardware and software wallets. But there are nuances of features for the two types of wallet. While hardware wallets are the most secure, software wallets are more convenient.
2. Choose A Trading Platform
Choosing a preferred trading platform proceeds with the set-up of a Bitcoin wallet. It means you need to choose a crypto trading platform on which you can buy and sell Bitcoin. Today, various online trading platforms are proliferating to buy and sell Bitcoin. But while we have some popular crypto exchanges like Binance, Coinbase, and Kraken, you can opt for trusted over-the-counter trading platforms like Prestmit to start trading your Bitcoin. This platform gives you convenience, safety, and relatively low trading fees.
3. Hold Or Trade Bitcoin
You can decide to hold or trade your Bitcoin. You can use your Bitcoin as your prerogative after buying the coin. But you are expected to keep abreast of Bitcoin price fluctuations as they pan out in the global crypto market if you want to hold your Bitcoin. On the other hand, you can decide to sell Bitcoin in Nigeria as you wish.
4. Develop An Investment Strategy
If you plan to hold, you must develop an investment strategy for keeping Bitcoin. This approach must be tailored to your risk tolerance and investment goals to minimise cost and maximise profits. Some common Bitcoin investment strategies are buy-and-hold (holding your Bitcoin for an extended period) and dollar-cost averaging (fixing a certain amount at regular intervals).
What Are The Best Practices For Bitcoin Investment?
1. Diversification
It is important to reiterate that Bitcoin is highly volatile, making its investment risky. That is why it is advisable to diversify your investment portfolio to have a shock absorber in Othe event of possible loss due to a tank of Bitcoin price. Diversification would enable the reduction of your overall risk.
2. Stay Up-To-Date On Bitcoin News And Trends
You can not invest in Bitcoin in a silo – therefore, you must stay afloat with Bitcoin news in Nigeria, trends, and data that will always inform your decision on when to invest and sell your Bitcoin. There are notable crypto news platforms to key into to know what is happening in the global crypto market related to Bitcoin.
3. Have An Exit Strategy
A clearly-defined exit strategy is crucial to Bitcoin investment. It guides you in taking a holistic approach to pulling out your funds in the face of a possible market crash. In most cases, this could involve setting a stop-loss order or setting a benchmark for the trade of your Bitcoin.
Tips For Investing In Bitcoin For Beginners
1. Conduct A Research
Similar to how a new business conducts feasibility studies, you need to know the potential benefits and risks of Bitcoin investment to decide whether you want to invest in Bitcoin. You may have to talk to professional investors to mentor you on how to have a successful investment.
2. Start Your Investment Small
Start your Bitcoin investment with a small amount of money. Start with an amount you can afford to lose without affecting your financial and mental health. Therefore, avoid investing a large amount of money when investing in Bitcoin as a beginner.
3. Keep Your Bitcoin Secure
Your Bitcoin is a digital asset of real-time value. Therefore, you must protect your Bitcoin with the exact security mechanism you place for the money in your bank account. While most crypto investors use software to endeavour to keep your private key private from the reach of people. Consider opening a Bitcoin wallet on Prestmit to store your Bitcoin safely.
4. Exercise Patience
You must have a good level of Patience to enable a successful Bitcoin investment. Try to constantly study the market trends and prospects before making a decision. Following the volatile nature of Bitcoin, making a spontaneous decision is not advisable.
Conclusion
We must emphasise how lucrative it is to invest in Bitcoin as it is one of the viable ways to make money online in this century. Bitcoin is a decentralised asset, and its prices are constantly changing. However, it is essential to study the ways and means of investing in Bitcoin to give you a good understanding of how to go by the investment.
By Adedapo Adesanya
The duo of Geo-Fluids Plc and Afriland Properties Plc propelled the NASD Over-the-Counter (OTC) Securities Exchange up 0.13 per cent on Friday, January 10.
Investors gained N1.4 billion during the trading session after the market capitalisation of the bourse ended at N1.053 trillion compared with the previous day’s N1.052 trillion, and the NASD Unlisted Security Index (NSI) increased at the close of business by 4.07 points to wrap the session at 3,073.93 points compared with 3,069.86 points recorded at the previous session.
Geo-Fluids added 25 Kobo to its value to close at N4.85 per unit compared with the previous session’s N4.60 per unit, and Afriland Properties Plc gained 24 Kobo to close at N16.25 per share versus Thursday’s closing price of N16.01 per share.
There was a 35.4 per cent fall in the volume of securities traded in the session as investors exchanged 4.3 million units compared to 6.6 million units traded in the preceding session, the value of shares traded yesterday went down by 37.4 per cent to N17.2 million from the N27.5 million recorded a day earlier, and the number of deals decreased by 47.2 per cent to 19 deals from the 36 deals recorded in the preceding day.
FrieslandCampina Wamco Nigeria Plc remained the most active stock by value (year-to-date) with 1.9 million units worth N74.2 million, followed by 11 Plc with 12,963 units valued at N3.2 million, and Industrial and General Insurance (IGI )Plc with 10.7 million units sold for N2.1 million.
IGI Plc closed the day as the most active stock by volume (year-to-date) with 10.6 million units sold for N2.1 million, trailed by FrieslandCampina Wamco Nigeria Plc with 1.9 million units valued at N74.2 million, and Acorn Petroleum Plc with 1.2 million units worth N1.9 million.
By Adedapo Adesanya
The Naira witnessed a depreciation on the US Dollar at the Nigerian Autonomous Foreign Exchange Market (NAFEM) on Friday, January 10.
According to data from the FMDQ Exchange, the local currency weakened against the greenback yesterday by 0.12 per cent or N1.80 to sell for N1,543.03/$1 compared with the preceding day’s N1,541.23/$1.
The pressure on the domestic currency came as the access granted to the Bureaux de Change (BDC) operators by the Central Bank of Nigeria (CBN) to purchase FX from the official market through the Electronic Foreign Exchange Matching System (EFEMS) platform prepares to end next week, precisely on January 19.
The CBN had given a 42-day window to the operators to access the platform to help stabilise the Naira in December, and this expires next week.
On Friday, the Nigerian currency tumbled against the Pound Sterling in the official market by N30.78 to sell for N1,889.29/£1 compared with the previous day’s N1,858.51/£1, but gained N5.48 against the Euro to finish at N1,583.81/€1, in contrast to Thursday’s rate of N1,589.29/€1.
As for the parallel market, the Nigerian Naira remained stable against the US Dollar during the trading session at N1,650/$1, according to data obtained by Business Post.
In the cryptocurrency market, it was bearish as the US economy added 256,000 jobs last month, the Bureau of Labor Statistics reported on Friday, topping forecasts for 160,000 and up from 212,000 in November (revised from an originally reported 227,000).
However, the readings came after a number of recent economic reports triggered a broad-market pullback across asset classes such as crypto as investors quickly scaled back the idea of a continued series of Federal Reserve rate cuts in 2025.
Cardano (ADA) fell by 3.6 per cent to trade at $0.921, Solana (SOL) slumped by 2.8 per cent to $185.93, Ethereum (ETH) depreciated by 1.4 per cent to $3,233.27, Litecoin (LTC) lost 1.3 per cent to finish at $103.62, Dogecoin (DOGE) shed 0.5 per cent to sell at $0.3315, Bitcoin (BTC), waned by 0.2 per cent to $94,154.43, and Binance Coin (BNB) went south by 0.1 per cent to $693.30.
On the flip side, Ripple (XRP) jumped by 1.5 per cent to settle at $2.34, while the US Dollar Tether (USDT) and the US Dollar Coin (USDC) sold flat at $1.00 each.
By Dipo Olowookere
Profit-takers took control of Customs Street on Friday, plunging it by 0.08 per cent at the close of trading activities.
The sell-offs were across all the key sectors of the Nigerian Exchange (NGX) Limited on last trading session of the week.
The insurance space went down by 1.53 per cent, the banking index depreciated by 0.41 per cent, the consumer goods sector weakened by 0.16 per cent, and the energy counter slumped by 0.08 per cent, while the industrial goods sector closed flat.
At the close of business, the All-Share Index (ASI) tumbled by 79.68 points to 105,451.06 points from 105,530.74 points and the market capitalisation retreated by N48 billion to N64.303 trillion from N64.351 trillion.
Yesterday, investors traded 1.5 billion shares worth N19.4 billion in 12,877 deals compared with the 489.5 million shares worth N13.1 billion transacted in 13,010 deals in the preceding day, indicating a decline in the number of deals by 1.02 deals and a rise in the trading volume and value by 203.14 per cent and 48.09 per cent, respectively.
Wema Bank was the busiest stock with 976.2 million units valued at N9.8 billion, Tantalizers traded 53.0 million units worth 129.6 million, Universal Insurance sold 34.8 million units for N26.8 million, Access Holdings exchanged 33.9 million units valued at N843.8 million, and Nigerian Breweries traded 27.3 million units worth N873.3 million.
The heaviest loss was suffered by Sunu Assurances with a decline of 9.99 per cent to trade at N7.30, Eunisell shed 9.96 per cent to N17.35, SAHCO crumbled by 9.87 per cent to N30.15, DAAR Communications plunged by 9.28 per cent to 88 Kobo, and Sovereign Trust Insurance went down by 7.04 per cent to N1.32.
On the flip side, C&I Leasing gained 10.00 per cent to close at N4.51, Honeywell Flour appreciated by 9.99 per cent to N10.02, Trans Nationwide Express jumped by 9.89 per cent to N2.00, RT Briscoe rose by 9.83 per cent to N2.57, and Secure Electronic Technology grew by 9.46 per cent to 81 Kobo.
Business Post reports that the bourse ended with 33 price gainers and 25 price losers, indicating a positive market breadth index and strong investor sentiment.
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