Can You Buy Part of a Bitcoin in 2023
As the price of a single bitcoin has risen, many beginner investors wonder if it is too late to invest in cryptocurrency. They are caught up with queries like whether or not they can purchase part of a bitcoin. What is the smallest amount of bitcoin I can buy? Should I just buy a small amount of bitcoin?
So can you buy part of a bitcoin? The simple answer is yes! Bitcoin can be purchased in fractions and you don’t have to buy an entire Bitcoin to own some.
Further in this article, we will cover all the topics related to Bitcoin, such as what it is, how to buy it, how to store it, and how to sell it. Also, explore how to buy a part of a bitcoin and the difference between Satoshi and Bitcoin.
So, What is Bitcoin?
Bitcoin is a digital currency that is based on blockchain technology. It is decentralized means that it is not controlled by any central authority. On the Bitcoin blockchain, every single Bitcoin transaction is recorded. Blockchain is the technology that safeguards Bitcoin and its users from hackers.
Bitcoin has been around since 2009, and it is the first cryptocurrency to ever be created. It is created through a process called “mining”, whereby computers solve complex mathematical equations to add new blocks to the blockchain.
Bitcoin is a secure and anonymous way to send money online, and it is becoming increasingly popular among users looking to make online purchases or investments. It has become one of the most popular digital currencies to invest in.
Among the most common bitcoin myths are that bitcoin is only used for illegal purposes. Bitcoin is a useless and unsustainable currency. The price of bitcoin fluctuates far too much to be used. Governments will eventually prohibit the use of bitcoin. Now, let’s dive deep into whether can you buy part of a bitcoin.
Can You Buy Part of a Bitcoin?
Yes, you can buy part of a bitcoin. The smallest unit of a bitcoin is called a “Satoshi”, and it is equal to one hundred millionth of a Bitcoin. It means that you can buy any amount of Bitcoin, even fractions of a Bitcoin.
What Is A Satoshi – a fraction of bitcoin?
Satoshi is the smallest unit of Bitcoin, named after Satoshi Nakamoto. He is recognised for introducing the blockchain protocol and the bitcoin cryptos.
The Satoshi was created to simplify and standardise bitcoin transactions; it is equal to 100 million bitcoin. In other words, one bitcoin is equal to 1000 millibitcoins, 1,000,000 micro bitcoins, or 100,000,000 Satoshis.
How Many Satoshis Are In 1 Bitcoin?
As you probably already know, each form of digital currency can be divided into extremely small units. So, a Satoshi is the smallest amount of bitcoin you can buy. One bitcoin is worth 100,000 million Satoshis, and you can buy as many as you want.
Difference Between Satoshi and Bitcoin
The size of the units is the main difference between Satoshi and Bitcoin. A Satoshi is Bitcoin’s smallest unit. BTC = one hundred millionth of a Bitcoin.
In contrast, a Bitcoin is the largest unit of a Bitcoin, equal to one Bitcoin.
Satoshi is the smallest original subunit of Bitcoin, the well-known cryptocurrency. Satoshis are divisible to eight decimal places. Satoshi is the only unit that Bitcoin’s core software recognizes and understands.
Bitcoin is simply a human-created way for 100 million satoshis. For Bitcoin Core, which is the main software that Bitcoin nodes use to keep the blockchain running, there are only Satoshis, but for people, there is Bitcoin.
Is it worth Buying Fractions of Bitcoin?
Whether you should buy fractions of Bitcoin depends on your financial position and goals. If you believe that cryptocurrency has a future, then yes.
Bitcoin is seen more and more as a way to protect yourself from inflation and bad management of fiat currencies, a way to keep your wealth safe that can’t be taken away, and a way to get into the world of high-level finance without approval. It’s done via the Ethereum blockchain, the second-largest coin after bitcoin, which hosts many DeFi projects that try to recreate the entire financial ecosystem on a blockchain.
Investing in fractions of Bitcoin can give investors exposure to the crypto market without requiring a large investment.
Benefits & Drawbacks of Buying Part of a Bitcoin
Advantages: Flexibility in Investment Amount, Fractional Ownership.
Disadvantages: Higher Fees, Complexity of Splitting Bitcoin Units.
Best Place To Buy A Part of a Bitcoin
The best place to buy Bitcoin depends on your location and payment method.
5 Ways to Buy Bitcoins
The good news is, there are a number of ways to engage in trading Bitcoin today. Since many big brokers provide a way for purchasing bitcoin, you might not even need to open a special account to do so. Bitcoin can be bought, sold, and held by U.S. citizens on a variety of platforms, including some you might not expect, such as PayPal and Cash App.
Each method listed below offers a distinct range of cost, security, and upside and downside.
Since bitcoin is a virtual currency used for digital transactions, you will require a bitcoin exchange to buy it. Cryptocurrency exchanges are a popular option to buy Bitcoin. Exchanges offer a few key advantages to traders.
First of all, the best cryptocurrency exchanges provide the most affordable total costs for trading cryptos. Therefore, if cost is your primary concern, they are your best option. Second, many exchanges do not charge spread mark-ups, which are essentially hidden fees built into trading prices. Third, many exchanges provide wallets, which allow you to safely store your cryptocurrency.
You can buy part of a bitcoin from eToro, Coinbase, Bisq, Paxful, Binance, Crypto.com, Gate.io and Kraken and other online crypto exchange platforms. The fees at various crypto exchanges can differ, so it’s good to look around to find which offers the best services.
Here is a quick review of a few of these platforms.
The cryptocurrency exchange Binance expanded even more rapidly than bitcoindid. It is one of the largest cryptocurrency exchange platforms in terms of volume and one of the fastest-growing in the world. You can purchase cryptocurrency by depositing fiat (USD or another state currency) via debit card/credit card or bank transfer (SEPA for EU citizens).
Kraken facilitates the buying and selling of cryptos and other digital tokens for fiat currency and other digital tokens. It is present in 48 US states and more than 176 nations around the world, and it lists 40 digital currencies that are open for trade. There are numerous deposit and withdrawal methods available, with credit cards and bank wires being the most popular.
Coinbase is a crypto platform for beginners and experts that allows crypto traders to buy and sell bitcoin. It has over 35 million users worldwide and serves as a gateway for many newcomers who then transfer their funds to other exchanges to trade. Deposit methods include credit cards, bank wires, ACH, and online payment processors.
Gate.io is ideal for new traders with a high-risk tolerance. It is the place to be if you want to invest in new, unconfirmed coins with the potential to skyrocket in value (real crypto mania of 1000x or even more). The exchange has a wide variety of features, including copy-trading, the NFT marketplace, staking and savings products, built-in bots, and much more.
Many financial apps, including PayPal and Venmo, now support cryptocurrency trading. PayPal makes it extremely simple to directly buy or sell bitcoins using the same app you’ve come to rely on for online payments.
Trades under $5 cost $0.49, and the fees increase from there. Above $1,000 trades cost 1.5%, while $200–$1,000 trades cost 1.8%. You can trade as little as $1 at a time and don’t pay a fee for holding crypto. Trades have a spread markup. Ethereum, Litecoin, and Bitcoin Cash can all be traded here as well. Since PayPal owns Venmo, fees are the same.
Using a trading app like Webull or Robinhood, you can buy a few bitcoins with no direct commission, though you’ll make up for it with a spread markup.
Robinhood uses its best trick—no commissions—to offer cryptocurrency trading, but it does impose a spread markup, the exact cost of which it does not disclose. You can buy stocks, ETFs, and options on the simple platform. Read more on Robinhood.
Webull allows you to trade over 25 different cryptocurrencies, including Bitcoin. However, you will be charged a 1% spread markup on each transaction. Stocks, ETFs, and options can also be traded. Read more on Webull.
Interactive Brokers offers Bitcoin futures contracts and direct trading. The broker charges $10.02 per futures contract for five bitcoins. Direct Bitcoin trading costs 0.12-0.18% of trade value, depending on monthly volume. Ethereum, Bitcoin Cash, and Litecoin are available. Other tradable securities are available through Interactive Brokers, giving you access to securities from around the world.
The fifth option is to buy bitcoins directly from a Bitcoin ATM, though you will almost certainly pay much higher commissions than you would elsewhere. You’ll be able to buy bitcoins and sell them at some ATMs using cash or a debit card. However, you may need a Bitcoin wallet to carry out the transaction. Commissions can be expensive. Some ATMs charge around 7% per transaction, while others may charge fees in the teen range.
The Best Place to Store Bitcoins
The best place to store your bitcoins depends on how you plan to use them. For example, if you intend to trade them, it may be best to keep them with the cryptocurrency exchange or broker where you trade, particularly if you plan to trade frequently or soon.
Others may choose a crypto wallet if they intend to spend the cryptocurrency or simply keep it safe. A crypto wallet can handle and secure your crypto, but if you’re taking custody of your assets, it’s entirely your responsibility, and you could lose your virtual currency if you’re not careful.
Hot wallets and cold wallets are two popular options for this particular group.
Users may lose bitcoin and other cryptos tokens due to theft, computer failure, key loss, and other factors. Cold storage (or offline wallets) is one of the most secure ways to store bitcoin. Although these wallets are not accessible online, they are still useful for some users. A hardware wallet is a physical device that stores your private keys offline and is the safest way to keep your Bitcoin.
Online wallets, also referred to as hot wallets, are wallets that can be accessed through tablets, phones, or computers. Hot wallets are ideal for small amounts of bitcoin or cryptocurrency that are actively trading on an exchange and are used in the same way as a checking account.
How Can I Sell Bitcoin?
Using a centralized exchange is a simple way to buy and sell Bitcoin and other cryptos. There are several platforms where you can sell Bitcoin. Coinbase, Binance, Kraken, and Bitstamp are among the most well-known platforms. On these platforms, the process of selling bitcoin is similar to that of purchasing it. These sites efficiently match buyers and sellers, allowing you to get the best price for your bitcoin purchase.
In general, you will be required to provide your name, address, and email address, along with the quantity of Bitcoin you wish to sell. Coinbase has an easy-to-use “buy/sell” button, and you can select which crypto and how much you want to sell.
What to Look for When Buying Bitcoin
When deciding how to buy Bitcoin, consider the following factors, as they will influence your decision on where to buy it or whether to avoid it entirely.
- Ownership: What exactly do you want to own? You can own Bitcoin directly or indirectly through a derivative such as a futures contract, which provides a return based on the currency’s moves.
- Upside/downside. Your potential profit is directly related to whether you own the currency directly or through a futures contract. By directly owning Bitcoin, your profit grows by one dollar for every dollar rise in the currency. In contrast, futures allow you to profit much more easily without having to put up as much capital. Although you can lose more money with futures, your downside is more limited when you own directly.
- Cost: Commissions can vary greatly depending on how you buy Bitcoin. Futures contracts give you a big piece of the action for a low price, while buying directly from a broker may cost you some percent. A few percent might not seem like much, but if you are constantly trading in and out of the market, it will rapidly eat away at your revenues.
- Security: One of the most important concerns with any investment is ensuring its security. Newer crypto players have had serious security issues. In 2022, hackers stole $570 million of Binance’s BNB coin. Traditional brokers may provide better security due to their long experience with the matter.
Bitcoins may also be received as part of commercial transactions. Regardless of how you obtained your coins, any crypto transaction must be reported to the IRS at tax time.
Is Bitcoin a Hedge Against Inflation?
Some believe Bitcoin is an effective inflation hedge. A hedge is a type of investment that can partially or fully make up for the loss of another asset. Thus, an inflation hedge would protect you.
According to experts, there is little evidence to support the claim that Bitcoin acts as an inflation hedge. Bitcoin has not been around long enough to have experienced a major inflationary period, but it is being tested in the current challenging market environment. Despite inflation reaching its highest level in decades, bitcoin has fallen nearly 60% in 2022 as of Oct. 7.
In addition, it is not a viable hedge against stock market volatility. Experts say Bitcoin behaves like a risky tech stock or momentum stock, rising and falling with them. That’s not what a hedge should do—it should zig when the market zags.
What information is needed to purchase Bitcoin?
The information needed to buy Bitcoin varies depending on the platform and payment method. In general, you will be required to provide your name, address, and email address. Some platforms may also request additional information from you, such as your birth date and a copy of your photo ID.
How can I buy Bitcoin using a credit card?
Most exchanges accept credit cards for Bitcoin purchases. In general, you will be required to provide your credit card information along with your name, address, and email address.
How to buy Bitcoin With PayPal?
You can buy Bitcoin with PayPal on some platforms. Some of the most well-known platforms are eToro, Paxful, and LocalBitcoins. In general, you must provide your PayPal info, along with your name, address, and email address.
Can you buy less than a bitcoin?
The short answer is “yes,” you can purchase less than a whole bitcoin. This holds true for almost every cryptocurrency, but it is especially true for expensive ones like Bitcoin which cost tens of thousands of dollars. A common misconception is that you cannot purchase less than a full bitcoin.
The article covered everything there is to know about Bitcoin, including the burning question of whether can you buy part of a bitcoin or not. We discovered that you can purchase a fraction of a bitcoin, which is worthwhile to consider if you want to diversify your investments. Satoshi is the smallest unit of Bitcoin. Satoshis cost only a few cents, and one bitcoin is made up of 100 million Satoshis.
Read more: How to Purchase with Bitcoin in 2022?