Buying Bitcoin myth busted!
In the last few months, hundreds of thousands, probably millions, of people have been Googling ‘Bitcoin’ in the search for ways to buy it. The newcomers to the world of cryptocurrency are sometimes challenged by the purchase process, but many of them are under the illusion that they need to spend thousands of dollars, pounds or Euros to get it.
The conversation goes something like this, according to one Lendo team member who was extolling the virtues of owning cryptocurrency to a friend:
Friend: “How much is Bitcoin worth?”
Lendo team: “About €12,000 today.”
Friend: “I don’t have that kind of money.”
Lendo team: “But, you don’t need thousands to buy Bitcoin. That’s a myth.”
What we’re demonstrating her is the mistaken belief that in order to own cryptocurrency, whether it is Bitcoin (BTC), Ethereum (ETH) or Litecoin (LTC), you have to buy whole coins. You don’t, you can put any amount in, even €100/£100. For many, the market valuations are a psychological barrier to entry, because people are fixated on the cost of one Bitcoin. Litecoin, for example, may seem slightly less scary because its value at the beginning of 2018 is around €120. As you can imagine, this seems more attainable to the majority of potential buyers.
This fear of the Bitcoin price seemingly puts off people who are unaware that they can buy fractions of Bitcoins. You simply send whatever you can afford to invest in it to one of the cryptocurrrency exchanges, click the Buy BTC button and the exchange converts it into a percentage of Bitcoin at the market value at the moment of purchase.
But this isn’t always clear to crypto newbies, who have heard the buzz about Bitcoin, but haven’t found a clear explanation of how to buy it. It is also the reason that many of them are turning to coins with lower prices, which is helping those new coins to rise in value.
One blockchain developer, Jimmy Song, has suggested that there should be a way to “ express one one-millionth of a Bitcoin (about one cent at today’s prices) as a “bit,” in the wallets and exchanges. He believes it will end consumer confusion and make new crypto users more apt to purchase Bitcoin, even if it is in small amounts. He also pointed out that lots of zeros and a decimal point tends to make people uneasy, whereas if a small amount of Bitcoin was expressed in whole numbers, people feel more comfortable. For example, $5 is 0.000345 BTC, which feels meaningless. But if it was 345 ‘Bits’ that seems more manageable. Erik Voorhees, CEO of ShapeShift, backs Song’s proposal: “For Bitcoin to be a global, commonly used currency, it would certainly be helpful to have a denomination that allows people to express prices in integers (2,000 bits for a coffee) rather than a decimal.”
So, to conclude, the myth of needing thousands to buy Bitcoin is busted — you can think in tens and hundreds, and you will still make money.