Should I Invest in Bitcoin in 2017? Here’s What You Need to Know

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2017 started with a bang as Bitcoin shot through the $1000 mark with no signs of slowing down. As a result I get about 2 emails a day from people around the world who are asking one very simple question: “Should I invest in Bitcoin?”

Before we begin, I want to get something out of the way – Bitcoin is not a company or a stock, it’s a currency. If you still don’t understand what Bitcoin is, watch this video. So when you want to invest in Bitcoin you are basically buying the currency. However, there are also some other forms of investing in Bitcoin.

What does it mean to invest in Bitcoin?

In order to answer this question the first thing you need to answer is what do you mean when you say you want to invest in Bitcoin. Do you want to buy the currency in hopes it will appreciate it value? Do you want to invest in Bitcoin related companies? Are you looking to day trade with Bitcoins?

Buying and holding

The most common form of “investing” in Bitcoin is buying the currency in hopes it will appreciate in value (also knowns as “hodling”, see the origins of the term here). If this is the case then you need to decide for yourself if you think this is a good time to buy. Meaning, do you think the price will continue to rise.

hodling Bitcoin

Don’t take anyone’s advice about what will happen with the currency, do your homework, learn about Bitcoin and come to a conclusion. Personally I believe we are just starting, but that’s my own opinion and you shouldn’t consider that as investment advice as well.

A few pointers for buying and holding Bitcoins:

  1. Never invest more than you are willing/able to lose – Bitcoin is a very risky investment and you should keep in that in mind at all times.
  2. After buying Bitcoins make sure to move them into your own personal wallet and never leave them at the exchange. My personal recommendation is to use a hardware wallet to store your Bitcoins. If you can’t afford a hardware wallet, try a paper wallet.
  3. Make sure to buy Bitcoins only from exchanges that have proven their reputation.
  4. Buy Bitcoins through Dollar cost averaging – This means that you don’t buy all of your Bitcoins in one trade but instead buy a fixed amount every month, week or even day throughout the year. This way you average the price over the course of a whole year. Here’s a short video to explain this concept:

Trading in Bitcoins

Bitcoin trading is different than buying and holding. When you are trading Bitcoins it means that you are actively trying to buy Bitcoins at a low price and sell them back at a higher price in relatively short time interval. Trading successfully requires knowledge and practice. The trading market is occupied by very large players who are just waiting for newbies to come in and throw their money away by trading aimlessly.

If you want to learn more about Bitcoin trading here are some practical tips to help you out.

Investing in Bitcoin mining

Some people would like to invest their money into mining Bitcoin. For the past few years mining Bitcoin is only profitable if done at large scales. This means you will need to get expensive mining equipment and hopefully have access to free electricity. Also it’s usually much more cost effective to buy Bitcoins with this money instead of using it to buy mining equipment.

Some of you may have heard of all sorts of sites that allow you to mine Bitcoins through them. This is known as cloud mining and these sites fall into one out of two categories:

  1. They are complete scams that will run away with your money and don’t actually use it to mine Bitcoin.
  2. They are not scams, but they are bad investments since you will probably get more Bitcoins if you just use that money to buy Bitcoins instead of paying the site.

If you want to learn more about my take on cloud mining read this post.

Invest in Bitcoin companies / grow your Bitcoins / HYIPs

Finally, every other day I get a question about a site or company that claims to double your Bitcoins, give you insane daily interest on your Bitcoins or help you invest them in some sort of complex and obscure scheme. These sites can be categorized mostly as scams or HYIPs (high yield investment programs).

What these sites usually do is they take money from people around the web and promise to give them good returns. They will then start off by paying these returns through money they get from new sign ups and create a big buzz around the site. Usually they will also have some sort of referral program so that users can bring in their friends. This will go on for around 3-4 months until one day the website will just go offline and the money will be gone. No more payments will be made and a lot of people will get mad that they got scammed.

I have reviewed many Bitcoin investment sites in the past 3 years (e.g. BTCJam, Bitcoin Trader) and I have yet to find a site that I can say is legit or safe to invest in. Any site that promises you something that is too good to be true is probably just a facade for scammers trying to steal your coins.

How can you find out if a site is a scam for yourself? Easy, use our Bitcoin scam test tool. I can’t emphasis this enough – STAY AWAY FROM SITES THAT CLAIM THEY WILL DOUBLE YOUR COINS OR GIVE YOU DAILY INTEREST ON THEM.

So should you invest in Bitcoin?

By now you can probably see that the answer isn’t that simple. It’s not just a matter of should you invest, but also a matter of how to invest. Like I said in the beginning, start by educating yourself. Learn about the currency, what affects it, what are its advantages and disadvantages, etc. You can get a lot of basic education through our free Bitcoin crash course (sign up at the bottom of this post).

After you feel you’ve acquired some basic education it’s time to answer this question. REMEMBER – only you can answer this. You can consult others and read online but never follow someone’s advice blindly.

Good luck!

Find the best exchange to buy Bitcoins


Ofir Beigel

Owner at 99 Coins ltd.
Blogger and owner of 99Bitcoins. I've been dealing with Bitcoin since the beginning of 2013 and it taught me a lesson in finance that I couldn't get anywhere else on the planet. I'm not a techie, I don't understand "Hashes" and "Protocols", I designed this website with people like myself in mind. My expertise is online marketing and I've dedicated a large portion of 99Bitcoins to Bitcoin marketing.

27 Comments

  1. I just started really looking into cryptocurrencies a few days ago. As you can imagine, I’ve been doing a lot of searches and clicking (sometimes nervously) on a lot of links. 99bitcoins has quickly become one of the sites I trust. Useful information, well presented, and a great resource for a cryptonoob.

    I’m not ready to start investing in Bitcoins yet, but this article has gotten me thinking it could be part of my semi-retirement income strategy. Thanks for the information.

    • Zsofia - 99Bitcoins support on

      Thanks John for your feedback. Keep reading on the site about Bitcoins. In case you have any questions, please feel free to let us know.

  2. Ofir, I cannot begin to thank you enough for what you are trying to do, you and your team. I feel that this crypto-currency is the wave of the future, the direction we are all, as a species, heading towards, and I think that with a little education, a person will be able to prevent ruining themselves financially. I, for one, am going to be promoting your site as well as your crash-course to anyone who will listen. You are providing a very much needed service to those willing to take the time to educate themselves, and for that you have my gratitude.

    • Hey Christopher, thanks so much for your comment, we really really appreciate the feedback :) I’ll also be sure to let Ofir know about your efforts of promoting the site.

      Zsofia (customer service 99Bitcoins)

  3. OMG! I wish i would have bought in a cpl years ago when i first heard about bitcoin.
    But also i was looking into using bitcoin as online currency, you can buy less than a whole bitcoin or no. Like i give you a dollar for a 50cent item and get 50 back or theres no change.?!

  4. william meyer on

    i have to admit this, this site (faucet) of yours is one of the best, just amazing, the support and services your provide are just great, keep it up and thank a lot.

  5. Well I be lost some good amount of bitcoins on all these hip sites,guess I learnt the hard way!thanks to your write up ,now I know better. Thanks Ofir.

  6. Last year I got my first bitcoin currency (0.00001 BTC actually) from you :). Since that time, I’ve bought some, invested, won, lost, bought an old miner, made a rig too and started mining… I can say I got hit pretty well by the digital money :)
    Thanks for your articles and keep up the good work .
    Felix

  7. PM.Ravindran on

    Hi Offir, great article & my best wishes.
    However I am based in India & I donot have financial strength to attend the meet & meet you all great people there in person.
    Offir, I am a victim of Crypto X Change Australia, who looted my 90.33 BTC in 2013 7 vanished . Can you help me to get my bitcoins from them or the owner please ? I am willing to offer 10 Bitcoins as good will gesture to the person who will help me to get back my bitcoins.
    One more request, please convey my regards to Mr. Roger Ver when you meet him.
    Thanks

    • Hello and very sorry to hear about your story. Unfortunately Bitcoin is very much like cash, if you lose it or if it gets stolen there’s not much that can be done to get the money back.

  8. Hi Admin, nice write you’ve got up there. my question is simple, what website or websites can you recommend for bitcoin investment that nothing to do with referrals? plenty thanks

    • As you can see from what I’ve written above, I’ve yet to find any reliable website to invest my Bitcoins with.

  9. first writeup that is helping me to understand the whole bitcoin thing…will keeping digging cos am yet to understand the whole bitcoin gist. THANKS FOR THIS

  10. Great Informative article for newbies like me. I have now gone with a Bitcoin hardware wallet (Ledger Nano S), which is a great piece of tech and safe for storing bitcoin offline. Also great advice not to ‘Bulk Buy’ bitcoin, but to buy gradually.

    Thanks Ofir

  11. Nice information. I am a newbie and was about investing in bitcoin with the aim of joining one these online sites that pay 100% after a 30 day period when I stumbled on this article. I just had a rethink. ” Any site that promises you something that is too good to be true is probably just a facade for scammers trying to steal your coins.” Thanks once more for this wonderful article.

  12. Hi Ofir,

    The information you had provided have good value for a newcomer who thinks to invest in the currency. Also, with all my exchange on the forum BitcoinTalk, I come to the same conclusion that all the HYIP and cloud mining are scam, and better stay away from them.

    I will share your article on twitter.

    Best Regards,

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