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How to invest in bitcoin smartly without buying the currency?
Do you want to invest in bitcoin, but are worried about its volatility and record swings? There’s no need for concerns, here are 6 different ways to invest in bitcoin without directly buying it on crypto platforms.
In this article we’ll show you how to utilize bitcoin’s potential through inventive investment methods with less risks and wider flexibility.
1. Investment in Bitcoin stocks and funds
An attractive method of investing indirectly into bitcoin is through buying stocks and funds linked to the world’s most valuable cryptocurrency.
There are many listed companies on Wall Street that either invested in bitcoin or works directly in the crypto industry.
For example, companies like MicroStrategy, Square, and Tesla hold huge amounts of bitcoins.
You could also invest into Bitcoin Exchange Traded Funds, with various holdings linked to bitcoin, which gives you a more balanced exposure to the crypto market.
However, it’s still worth noting that investing in bitcoin stocks and funds still carries serious risks due to market volatility, so it pays to research well before taking an investment decision.
2. Investing in bitcoin mining companies
Investing in bitcoin mining companies is another indirect approach. Mining is the process of authenticating transactions and adding them to block chains.
Through investing into these companies, you could benefit from bitcoin’s increasing value without directly holding it.
However, it still carries risks due to the volatile nature of bitcoin itself, while the mining process itself is complex and energy intensive.
Additionally, changes in crypto regulations could negatively impact the profitability of these companies.
3. Investing in bitcoin futures
Bitcoin futures provide an opportunity for investors to bet on bitcoin’s future value without directly holding it. This method could be used to hedge against potential risks, or to speculate on bitcoin’s future prices.
However, trading in futures requires a deep understanding of this specific market, and still carries considerable risks.
4. Investing in blockchain technology companies
Blockchains are the backbone of bitcoin and other crypto currencies, and through investing into companies developing them, you could indirectly benefit from bitcoin’s rally.
Nonetheless, technological developments or regulatory changes could affect the profitability of these companies.
5. Investing in bitcoin derivatives
Bitcoin derivatives allow investors to bet on bitcoin’s future prices without directly owning it, and include products such as options, and swaps.
As with bitcoin futures, these bitcoin derivatives require a deep understanding of the market, and carry considerable risks.
6. Investing in bitcoin-linked companies
Many companies accept bitcoins as a payment method, and by investing in these companies, you could indirectly benefit from bitcoin. These companies include online retailers, restaurants, and even some real estate companies.
Once again, investing in such companies still carries risks to bitcoin’s volatility, and the possibility of regulatory or operational challenges that could impact the profitability.
The Summary
Despite bitcoin’s highly volatile nature, there are many ways to invest smartly into it without direct purchases.
As we mentioned, these options include bitcoin stocks and funds, mining companies, futures, blockchain companies, derivatives and others, which could all provide some buffers.
However, it remains crucial that investors conduct a thorough research and assessment of their financial goals, and their ability to tolerate risks before taking investment decisions.
Gold about to mark best weekly performance in 2024 amid mounting geopolitical tensions
Gold prices rose in European trade on Friday on track for the fifth profit in a row, trading above $2700 for the first time in two weeks, and about to mark the best weekly profit this year on strong haven demand due to mounting geopolitical tensions.
Ukraine intensified the use of western weapons and missiles in attacks on Russia, which prompted the latter to expand the conditions of using its nuclear arsnel, as the war in Eastern Europe deteriorates before Donald Trump’s January inauguration.
Gold markets shrugged off the receding odds of a US interest rate cut in December following a series of bullish remarks by Fed officials.
Prices
Gold prices rose 1.45% today to $2708 an ounce, a November 6 high, with a session-low at $2668.
On Thursday, gold prices rose 0.75%, the fourth profit in a row on haven demand.
Weekly Trades
Gold is up 5.5% so far this week on track for the best weekly profit since March 2023.
Geopolitical Tensions
The Ukrainian army said on Thursday its drones hit four oil refineries, radar stations, and other military facilities in Russia.
Ukraine recently launched a series of British Cruise missiles on Russia on Wednesday, the newest western weapon that was allowed for use by Ukraine on Russian targets, after the launch of the American ATACMZ missiles.
Russian president Vladimir Putin approved an update to the nuclear doctrine, expanding the conditions of their use.
The US Biden administration allowed Ukraine to use American made weapons to hit deeper into Russia according to media sources.
The Kremlin warned that such a decision would directly implicate the US into the conflict, and accused the Biden administration of escalation.
US Rates
Federal Reserve Governor Michelle Bowman said on Wednesday that progress in reducing inflation seems to have halted.
The odds of a 0.25% US interest rate cut in December slipped from 59% to 52%.
Now investors await US unemployment claims later today in addition to remarks by several Fed officials to gather more clues.
SPDR
Gold holdings at the SPDR Gold Trust rose 2.58 tons yesterday, the fifth increase in a row, to a total of 877.97 tons, a November 7 high.
