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 NASD Over-the-Counter (OTC) Securities Exchange extended rallied by 1.18 per cent on Friday, May 8, its fifth in a row for this week.
During the session, the market capitalisation increased by N28.96 billion to N2.488 trillion from N2.459 trillion, and the NASD Unlisted Security Index (NSI) jumped by 48.39 points to 4,158.77 points from the 4,110.38 points recorded a day earlier.
The growth witnessed yesterday was spurred by the gains recorded by six securities, led by 11 Plc, which chalked up N11.00 to sell at 221.10 per unit versus Thursday’s closing price of N210.10 per unit. FrislandCampina Wamco Nigeria Plc added N10.26 to close at N132.98 per share compared with the previous day’s N127.06 per share, and Central Securities Clearing System (CSCS) Plc rose by N2.82 to N75.90 per unit from N73.08 per unit.
In addition, Lighthouse Financial Services Plc appreciated by 7 Kobo to 86 Kobo per share from 81 Kobo per share, UBN Property Plc climbed higher by 5 Kobo to N2.25 per unit from N2.20 per unit, and First Trust Mortgage Bank Plc gained 2 Kobo to close at N2.32 per share, in contrast to the previous session’s N2.30 per share.
Conversely, Geo-Fluids Plc went down by 20 Kobo to N2.90 per unit from N3.10 per unit, and Afriland Properties Plc lost 5 Kobo to end at N16.95 per share versus N17.00 per share.
The volume of transactions for the session surged by 41.8 per cent to 528,891 units from 372,916 units, and the value grew by 11.4 per cent to N34.0 million from N30.4 million, while the number of deals slid by 7.4 per cent to 25 deals from 27 deals.
The most traded stock by volume on a year-to-date basis was Great Nigeria Insurance (GNI) Plc, with 3.4 billion units worth N8.4 billion. Resourcery Plc occupied the second spot after trading 1.1 billion units valued at N415.7 million, and the third position was occupied by Infrastructure Guarantee Credit Plc with 400 million units sold for N1.2 billion.
The most traded stock by value on a year-to-date basis was GNI Plc with 3.4 billion units transacted for N8.4 billion, followed by CSCS Plc with 60.5 million units exchanged for N4.1 billion, and Okitipupa Plc with 27.8 million units traded for N1.9 billion.
By Dipo Olowookere
The local stock exchange reversed the previous day’s loss, with a 2.10 per cent surge on Friday as a result of demand for large-cap equities like Dangote Cement, First Holdco and others.
It was observed that apart from the insurance counter, which shed 0.37 per cent, every other sector closed higher yesterday.
The industrial goods index expanded by 7.26 per cent, the banking segment increased by 3.35 per cent, the consumer goods industry rose by 0.21 per cent, and the energy sector soared by 0.14 per cent.
Consequently, the All-Share Index (ASI) of the Nigerian Exchange (NGX) Limited improved by 5,041.22 points to 244,775.83 points from 239,734.61 points, and the market capitalisation added N3.235 trillion to settle at N157.094 trillion compared with the preceding session’s N153.859 trillion.
The quintet of Neimeth, Cadbury Nigeria, LivingTrust Mortgage Bank, Mecure, and Dangote Cement led the advancers’ table on Friday, with 10.00 per cent growth each to quote at N9.90, N72.60, N3.52, N72.60, and N1,088.00, respectively.
On the flip side, the duo of UAC Nigeria and Industrial and Medical Gases lost 10.00 per cent each to sell for N171.00 and N42.30, respectively, as Eterna declined by 9.93 per cent to N33.55, Learn Africa slipped by 9.89 per cent to N8.20, and Deap Capital tripped by 9.69 per cent to N5.50.
The most active stock for the day was VFD Group, with a turnover of 102.9 million units valued at N1.1 billion. FCMB transacted 99.4 million units worth N1.1 billion, UBA traded 94.5 million units for N3.8 billion, Access Holdings exchanged 85.4 million units worth N2.0 billion, and Zenith Bank sold 46.5 million units valued at N5.8 billion.
At the close of trades, market participants traded 1.1 billion units worth N55.0 billion in 69,996 deals, in contrast to the 1.8 billion units valued at N72.2 billion transacted in 81,131 deals a day earlier, showing a crash in the trading volume, value, and number of deals by 38.89 per cent, 23.82 per cent, and 13.73 per cent, respectively.
By Adedapo Adesanya
The Naira fell against the US Dollar by N5.54 or 0.41 per cent to N1,361.39/$1 from N1,355.85/$1 in the Nigerian Autonomous Foreign Exchange Market (NAFEX) on Friday, May 8.
The domestic currency also depreciated against the Pound Sterling in the official market during the session by N8.50 to trade at N1,853.68/£1 compared with the previous day’s N1,845.18/£1, and against the Euro, it lost N9.37 to sell for N1,602.63/€1 versus N1,593.26/€1.
However, at the GTBank FX desk, the Nigerian Naira appreciated against the US Dollar yesterday by N3 to quote at N1,372/$1 compared with Thursday’s closing value of N1,375/$1, and at the parallel market, it traded flat at N1,380/$1.
Despite the volatile outcome of the local currency, it remained within the expected trading range, reflecting sustained FX stabilisation efforts by the Central Bank of Nigeria (CBN), supported by improved liquidity, stronger autonomous inflows, and better price discovery.
Traders point to further gains for the Naira into the coming week, thanks to Dollar supply from foreign investors, exporters and oil companies, while demand is moderate. Nigerian yields are still attractive for foreign investors, serving as a basis for more (FX) flows coming to Nigeria.
Meanwhile, the country’s external reserves dropped by 3.4 per cent to $48.32 billion, from a 2009 high of $50.02 billion recorded on March 11.
In the cryptocurrency market, prices rallied after worries eased, following fresh US airstrikes in Iran that initially sparked a surge in oil prices and a broader risk-off move across crypto markets.
Bitcoin (BTC) added 0.8 per cent to sell at $80,212.54, Solana (SOL) gained 6.5 per cent to sell at $93.76, Cardano (ADA) appreciated by 5.1 per cent to $0.2749, Dogecoin (DOGE) grew by 3.7 per cent to $0.1102, and Ripple (XRP) rose by 3.1 per cent to $1.42.
Further, Binance Coin (BNB) jumped 2.3 per cent to $650.16, Ethereum (ETH) expanded by 1.6 per cent to $2,315.48, and TRON (TRX) increased by 0.1 per cent to $0.3515, while the US Dollar Tether (USDT) and the US Dollar Coin (USDC) remained unchanged at $1.00 apiece.
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