Bitcoin Investment Guide: The Pros and Cons

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First launched in January 2009, it took Bitcoin around two years to break $0.40, after which it reached nearly $30 and then dropped to just $2.

In 2025, 15 years after an intrepid investor spent 10,000 BTC on two pizzas, it sits comfortably above $100,000.
It's been a meteoric rise for this cryptocurrency, but despite its current value and prevalence, it's still a relatively unknown entity to many. So, what is it, how does it work, and most importantly, is Bitcoin a good investment?

What is Bitcoin? Digital Gold Explained for Beginners

Bitcoin (BTC) is a cryptocurrency, a type of digital currency where transactions are verified using cryptography and held in a decentralized ledger known as a blockchain. That's the short definition, but here's a quick summary of the key terms:

• Cryptography is a method of securing information using complex algorithms and keys to encrypt, decrypt, and authenticate.
• Decentralized means the currency is not created or controlled by a central authority, such as a central bank.

Blockchain is a ledger that records transactions from digital assets across a transparent, peer-to-peer network.

Think of it as digital gold. Like gold, Bitcoin is an asset that's mined into existence, but the "mining" is conducted by powerful computers that solve complex problems.

After mining, it can then be traded for other assets—including fiat currencies like the US dollar—or used to pay for goods and services.

Bitcoin vs Traditional Money

Traditional money is a physical product controlled by a central authority. Governments issue and partly control the value via monetary policies set by central banks (such as changing interest rates and buying government bonds), with the value also determined by supply and demand, economic stability, and public confidence.

Bitcoin is entirely digital and decentralized. Governments can set regulatory policies that impact the value of BTC—such as the 2025 GENIUS Act—but they don't issue or control the asset itself.

Bitcoin price movements mainly occur as a result of supply and demand—more buyers than sellers drives up the price; more sellers than buyers lowers it—and this is influenced by everything from media reports to competition from other cryptocurrencies.

How Bitcoin Mining Works

If all Bitcoin is initially mined, you may wonder why you can't mine your own.

You can, but it's not easy or cheap. Mining requires an immense amount of computing power, with machines costing upwards of $10,000. It's also a complicated process, requiring a deep understanding of the blockchain and the mining process.

Miners choose transactions from a group of unconfirmed transactions, and must then solve complicated proof-of-work puzzles before adding that block to the blockchain.

Essentially, they need to create a block hash (a type of code) with fewer or an equal number of zeros as a target hash. They can't simply make random manual guesses, as that would take an eternity, so they use computers to make billions of guesses for them. Once they complete the puzzle, the miner is rewarded with Bitcoin, with the reward halving for every 210,000 blocks (about every four years).

Price Analysis: How to Predict Bitcoin Price Movements

Financial analysts use three methods to predict Bitcoin price movements. Beginners can experiment with a mixture of the three to get a feel for the prediction process:

• Technical analysis focuses on statistical trends, such as analyzing price charts and historical patterns.
• Fundamental analysis spans various underlying supply and demand factors, including global economics and geopolitical trends.
• Sentiment analysis emphasizes trader sentiment, such as high expectations and panic selling.

Bitcoin Calculator: Converting BTC to USD

Digital assets are highly volatile, with significant rises and falls over the course of a single day. If you have invested, you need to keep track. 

The easiest way to monitor your Bitcoin investment is to install a converter widget on your phone—simply search "Bitcoin price widget" in the app store.

Alternatively, check the latest price on our Liveticker.

Bitcoin Price Predictions 2025 : Expert Forecasts & Analysis

2025 has been a big year for BTC. Trade tariffs rocked financial markets and digital assets in the first half of the year, but new regulations enacted by President Trump lifted the value above $120,000, and it has been trundling along since then.

The most optimistic predictions suggest that Bitcoin could hit $1 million by the end of the year. Samson Mow, for example, predicts that a sudden and significant rise driven by nation-state adoption will cause the price to skyrocket.

More modest and realistic predictions suggest a value of under $200,000, with most anticipating a price of between $125,000 and $140,000. These predictions assume that conditions will remain positive for cryptocurrency, while more ambitious predictions rely on the currency being adopted as legal tender in more countries.

To date, it has only been adopted in El Salvador and the Central African Republic (CAR), but both countries repealed their decisions (CAR in 2023 and El Salvador in 2024).

Is BTC a Good Investment?

To properly answer this question, let's look at some of its pros and cons compared to traditional investments and other cryptocurrencies:

Pros of Making a Bitcoin Investment

• Use and Popularity: BTC is a very useful asset, and aspects such as decentralization, speed, fee-free transfers, and security could drive its value up. Its popularity is also holding strong compared to other cryptocurrencies, and as Bitcoin price movements are driven by supply and demand, this could lead to future price surges.
• Changing Regulations: While governments were initially skeptical of the crypto sector, the tide seems to be turning. The GENIUS Act was a big win for crypto, and other countries may follow the USA's lead.
• Inflation Hedge: BTC is considered a hedge against inflation—when traditional investments struggle, the crypto market flourishes.

Cons of Making a Bitcoin Investment

• Volatility: All cryptocurrencies are volatile, much more so than stocks and bonds. The market swings unpredictably, causing trader anxiety.
• Limited TPS: BTC can only process about seven transactions per second (TPS), and it's difficult to scale the blockchain to change this. Solana can process over 900, while ICP can manage 1200+.
• Power Hungry: There are concerns about this digital currency's power consumption, and this may hold it back from being adopted as legal tender. Mining alone is said to consume as much electricity as Poland.

Bitcoin vs Other Cryptocurrencies: Investment Comparison

Crypto, by its nature, is decentralized and volatile, but there are still many differences in functionality and investment potential across different digital assets:

Crypto	Purpose	Investment Value	Market Cap*	2025 Value*
Bitcoin	Digital currency	Store of value with limited supply	$2.2 tn	$110,124
Ethereum	Smart contracts, NFTs, dApps	High-performance ecosystem supported by NFTs	$555 bn	$4,372
XRP	Digital currency	Store of value	$170 bn	$2.8
Tether	Stablecoin	Minimal investment value, as it's tied to USD	$167 bn	$1
Binance Coin	Tied to the Binance ecosystem	Deflationary supply. Robust infrastructure	$120 bn	$840
Solana	High-performance blockchain	Speed, performance, and low fees	$105 bn	$187
Litecoin	Digital currency	Store of value	$8.6 bn	$109

How to Buy Bitcoin: Step-by-Step Guide for [current_year]

Whether you're making a sizeable Bitcoin investment or just dabbling in cryptocurrency for the first time, there are a few ways to invest:

Cryptocurrency Exchange

With crypto exchanges like Binance, Kraken, and Coinbase, you can swap fiat currencies for hundreds of digital assets:

• Find a trusted cryptocurrency exchange regulated in your jurisdiction.
• Verify your account.
• Choose a payment method (such as a debit/credit card) and add funds to your account.
• Search for "BTC" in the exchange.
• Choose how much you want to invest.
• Confirm your purchase.

Buy and Store BTC in a Crypto Wallet

Tokens purchased from an exchange will be stored in a custodial wallet—a crypto wallet managed by the exchange. However, if you download a software wallet (such as Zengo or Exodus) or buy a hardware wallet (such as Ledger and Trezor), you can transfer them.

A crypto wallet is technically not a way to buy cryptocurrency, but you can trade crypto through integrated apps on many software wallets.

Exchange-Traded Funds (ETFs)

With an ETF, you're not actually buying crypto, but you are exposed to its price movements and can still profit if the value surges. ETFs trade on stock exchanges, and are available as spot ETFs (which hold crypto) and futures ETFs (agreements to buy/sell at a later date).

• Choose a regulated broker—options include Fidelity Investments, E-Trade, Charles Schwab, and Robinhood.
• Check the broker's fees, including transaction fees, withdrawal fees, and maintenance fees.
• Sign up and verify your account.
• Add a payment method and fund your account.
• Browse through the list of ETFs.
• Choose how much to invest.
• Consider setting stop-loss and take-profit orders to protect your investment.

Money-Transfer Apps

Many money-transfer apps now allow you to buy and hold cryptocurrency directly in the app. Options include PayPal, Venmo, and Revolut. Here's an example of how to invest through the PayPal app:

• Sign up for a PayPal account and go through the verification process.
• Add a debit card or bank account and verify the payment method.
• Navigate to "Finances" and "Crypto".
• Select "Bitcoin" from the list.
• Choose how much you want to buy and confirm the transaction.

ATMs

There are crypto ATMs in over 60 countries, including thousands in the United States. They work much like traditional ATMs, but instead of dishing out cash, they transfer cryptocurrency to your wallet.

Confirm the transaction.

Sign up for a crypto wallet and note your wallet ID.

Find a nearby Bitcoin ATM using this map.

Go through the verification step.

Provide your wallet ID.

Insert cash into the machine.

Frequently Asked Questions