How Do You Use Bitcoin to Buy Gold and Silver?
Many investors like to purchase Physical Gold and Silver specifically to guard against the failure of fiat currency. Of course, these are generally the same people who would potentially be interested in a cryptocurrency like Bitcoin. If your interest in Precious Metals and cryptocurrency is based on these concerns, you may also be wondering how you can purchase your Precious Metals with Bitcoin. Let’s discuss how to use Bitcoins to buy Precious Metals as well as the advantages and drawbacks of using Bitcoins to buy Silver and Gold.
Setting Up a Bitcoin Wallet
As a new adopter, you can get started using Bitcoin even before you have perfected your understanding of how it works. You will become more comfortable with Bitcoin as you see it in action. After you install a Bitcoin Wallet on your computer or mobile device, it will generate a Bitcoin address. This address is how you send and accept Bitcoin payment, and Bitcoin addresses are generally considered single-use. You choose with whom you wish to share a given address, and you create a new one whenever you feel it’s necessary. The process of sending or requesting funds is similar to sending an e-mail, and even those who are not tech-savvy will find it simple and accessible.
Buyers can make their purchases at any time, from the comfort of home, when doing almost any kind of business, just as with most credit cards. Shoppers may, however, appreciate that Bitcoin makes completing international purchases significantly easier. Cryptocurrency like Bitcoin is a single international currency, accepted worldwide without conversion. Also, many customers prefer Bitcoin payment because of the anonymity offered by a blockchain purchase. Bitcoin transactions may also incur lower merchant fees than those made with PayPal or credit/debit cards. As a result, customers may pay lower premiums over spot on their precious metals purchases.
Despite the possible advantages to purchasing Precious Metals with Bitcoin, there are also risks associated with using virtual currency to purchase Precious Metals. One factor to consider is the lack of privacy. Upon completion of a purchase, the details of the transaction as well as the address of the buyer are publicly, permanently, recorded on the Bitcoin network for anyone to see. Bitcoin thrives on anonymity through the single-use addresses they offer, but that is really the only thing obscuring your identity when conducting transactions through Bitcoin.
RISKS OF BITCOIN
Another risk customers assume when paying for Precious Metal with Bitcoin is loss potential. Since its introduction in 2009, Bitcoin has experienced constant and drastic price fluctuations. Volatility of that severity can quickly shift the purchasing power of buyers, leading to frustration or embarrassment. Lastly, the future of Bitcoin is still uncertain. Users have no guarantee of what may happen to the USD value of their Bitcoin holding should the currency collapse. As a result, experts generally advise adopters not to store any more money in their wallet than they can afford to lose.
Perhaps the biggest risk facing Bitcoin adopters is the lack of buyer protection. At this time, all transactions made through Bitcoin are both instant and irreversible, meaning that this method of payment is easily exploited by con artists. So, while Bitcoin, for example, offers several suggestions about how to prevent hackers from accessing one’s wallet, it offers no compensatory remuneration should their suggested prophylactic measures fail. In fact, the only recourse a defrauded client has is to contact the merchant directly to ask for a refund, which can be difficult, embarrassing or even dangerous if a hacker was using one’s funds to make illicit purchases. In these cases, there is nothing that either Bitcoin or the customer can do to retrieve their stolen funds.
Pay with Bitcoin
Bitcoin is an exciting new medium for online purchases, and it certainly has some ideal applications. However, this is a currency in its infancy. Experts advise against “investing” in Bitcoin, and only holding at any moment as much as one can afford to lose.