Bitcoin mining stocks outperformed Bitcoin in terms of value for many reasons. Learn why are they so important. 

 occurred in 2016. Since then, Bitcoin mining stocks have gained interest. These stocks represent companies that operate large-scale facilities to mine Bitcoin, the top cryptocurrency by market capitalization. In 2023, Bitcoin mining stocks outperformed Bitcoin itself by a wide margin, generating impressive returns for investors. But what are the reasons behind this success? And how do Bitcoin mining stocks compare to Bitcoin as an investment option? This blog post will dive into these questions and more.

Understanding Bitcoin Mining and Bitcoin Mining Stocks

 is the process of validating transactions and creating new bitcoins using specialized hardware and software. Miners compete with each other to solve complex mathematical puzzles that require significant computing power. The first miner to solve the puzzle adds a new block of transactions to the Bitcoin 

, the distributed ledger that records all transactions. In addition, the miner receives a reward in the form of newly minted bitcoins and transaction fees.

The term “Bitcoin mining stocks” refers to shares of publicly traded companies that derive most of their revenue and profits from Bitcoin mining operations. These companies typically engage in activities such as creating and operating Bitcoin mining farms, producing and selling mining hardware and equipment, and providing related services for Bitcoin miners. Investing in these stocks can be a way to gain exposure to the crypto world without the associated risks of directly owning cryptocurrencies.

The Performance of Bitcoin Mining Stocks in 2023

Despite the volatility and uncertainty in the crypto market, Bitcoin mining stocks had a stellar performance in 2023. According to 

 Cointelegraph, the average year-to-date stock price gains in 2023 among the top nine public Bitcoin mining firms by 

 was 257.14%. This figure is almost three times higher than Bitcoin's price gain in the same period. 

Factors Behind the Success of Bitcoin Mining Stocks

Several factors contributed to the success of Bitcoin mining stocks in 2023. 

Buying Bitcoin mining stocks and purchasing Bitcoin are both ways to invest in crypto, but they have some key differences. 

Advantages of Investing in Bitcoin Mining Stocks

Investing in Bitcoin mining stocks can offer some advantages over investing in Bitcoin directly.

The best Bitcoin mining stocks in 2023 have shown strong performance, profitability, growth potential and innovation. Based on these criteria, here are seven top picks for 2023.

Riot Platforms, a Texas-based Bitcoin mining company, boasts an impressive hash rate capacity of 

 and operates a 700-megawatt (MW) facility, making it the single largest in North America. In Q2 of 2023, the company successfully 

, with a low production cost of $8,389 per Bitcoin. It reported 

 in the last quarter, and experienced a remarkable year-to-date price surge of 234.8%, closing at $11.35 on August 31.

Also based in the United States, Marathon Digital Holding 

 in the second quarter of 2023, boasting a hash rate 

. Marathon Digital has enjoyed an impressive 

 increase in share price this year, and reported a 

 in the second quarter. The company's primary objective is to become North America's largest and most environmentally conscious Bitcoin miner.

Based in Alberta and Ontario, Hut 8 Mining operates with a hash rate capacity of 2.6 EH/s. In the second quarter of 2023, they mined 399 BTC and reported a revenue of 

The company has experienced an impressive year-to-date increase in share price of 185.9%, closing at $2.43 as of August 31. Hut 8 is committed to expanding its mining capacity and diversifying its revenue streams through 

Hive Blockchain Technologies, another Canadian company, is dedicated to mining Bitcoin and Ethereum using sustainable energy sources like hydroelectricity and geothermal power. In the second quarter of 2023, the company 

Operating in Québec and Argentina, Bitfarms Ltd., a leading Bitcoin mining company, currently boasts a 

 During the second quarter of 2023, the company 

. Bitfarms has made significant strides in the stock market, experiencing a 

 in share price. The company is leveraging low-cost renewable energy sources to target mining capacity expansion to 

Based in the United Kingdom, Argo PLC is a Bitcoin mining company that operates in Texas and Québec. It has achieved a total hash rate 

, and in the first half of 2023, it successfully 

 in the first half of 2023. The company aims to become one of the biggest and most eco-friendly Bitcoin miners worldwide by implementing renewable energy sources and carbon offsetting programs.

CleanSpark, a leading provider of energy management and Bitcoin mining software solutions based in the United States, has reported impressive growth during the third quarter of fiscal year 2023. The company operates several mining facilities, and boasts a hash rate 

, mining a total of 4,729 BTC for CY 2023. CleanSpark generated a 

The company remains committed to improving its mining efficiency and sustainability by utilizing 

 technology and renewable energy sources. It has received full funding to expand its facilities to hit a target of 16 EH/s operational hash rate by the end of 2023.

Summary: The Dominance of Bitcoin Mining Stocks

Bitcoin mining stocks have emerged as a dominant force in the crypto space, outperforming Bitcoin by a wide margin in 2023. These stocks offer investors a way to gain exposure to the growing demand for Bitcoin under a regulated framework. Bitcoin mining stocks offer some advantages over Bitcoin, such as lower volatility, higher liquidity, regulatory compliance and exposure to other business segments. However, investing in Bitcoin mining stocks is not without risks. Therefore, when 

, consider operational issues, environmental concerns, competition and regulatory uncertainty. 

Intermediate

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Bitcoin Mining Stocks: Why They Outperformed Bitcoin in 2023

Learn all about earning interest on crypto, and the various ways you can earn crypto interest on Bybit for high yields!

Part 1: The Basics of Earning Crypto Interest

Cryptocurrency markets are well-known for their inherent volatility. While this poses nontrivial risks, it also opens up unique opportunities to earn yields and returns that the traditional stock market investor may not even dream of.

These substantial yield opportunities have grown larger and more accessible with the development of the 

 (DeFi) industry. The real game changer has come about with the boom of crypto 

(DEXs), both striving to give customers a diversity of financial products.

In this article, we’ll show you how to earn interest on crypto and, more importantly, how to choose investment opportunities that will optimize your yields.

Jargon to Know to Help You Earn Interest on Crypto

Before diving into the best opportunities to earn interest on crypto, let’s cover some of the most important terms used in the crypto finance industry.

 (APY) is yearly interest that accrues to your investment, taking into account the effect of compounding.

 is the measure of a crypto’s market value, which is derived by multiplying its current market price by its circulating supply.

 (TVL) refers to the total market value of all the crypto funds currently locked in a DeFi platform’s 

 refers to a substantial and usually prolonged market decline. Bear markets are characterized by the dominance of selling rather than buying among market players.

 is a decentralized digital network that stores transactions in chains of blocks. Transactional activity on a blockchain is controlled collectively by all of the network’s participants/users. Most of the activity on a blockchain network — exchange of funds between users, confirmation of transactions, and business operations — involves the use of crypto coins.

 (PoS) is a consensus mechanism used on some blockchain networks for validating block transactions. In PoS blockchains, network users lock a certain amount of their crypto assets on the platform for the right to validate transactions and receive staking rewards.

 refers to locking crypto funds, both on centralized and decentralized platforms, in order to generate income.

 is a process whereby you deposit your crypto assets in a DEX’s 

in order to receive rewards in tokens and fees.

 occurs when the price of a deposited asset in a liquidity pool decreases from the time when you deposited it.

The primary methods through which you can earn interest on crypto are staking and lending. Staking involves locking your funds on a blockchain to help validate transactions, in return for which you earn crypto rewards from the platform. Additionally, some centralized platforms — such as CEXs and 

Staking, however, has moved beyond its original intent and now often refers to a plethora of investment products on CEXs and DEXs, in which funds aren’t specifically used for blockchain validation.

 refers to depositing your funds to lending pools (and sometimes to other types of pools as well) with DeFi lending and borrowing protocols, as well as with centralized crypto lending platforms.

When considering lending and staking crypto, of key interest to investors are the security and investment risks involved.

Staking is often viewed as a safer option than lending. After all, staking is a fundamental process on a blockchain network, and is thus well-protected by the overall blockchain security model. If staking fails on a blockchain, the entire blockchain fails, along with all of its 

 (DApps). Due to this critical importance of staking, its safety is secured against all but the most severe hacks.

DeFi lending also takes place on DApps residing on top of the underlying blockchain, which introduces an additional layer of vulnerability. Furthermore, DeFi lending presents some very specific security risks, such as 

Therefore, staking generally poses comparatively fewer security threats to your funds as compared to lending. 

The risk-vs.-return between staking and lending, however, may not be as clear-cut. In general, established lending protocols such as 

 offer lower interest rates for large-cap, popular cryptocurrencies, as compared to standard staking interest rates. However, some smaller lending platforms might offer extremely high-interest rates, usually for highly volatile, small-cap coins.

As with everything in the world of finance, the higher the rate offered, the more risk the investment carries. The downside risks of investing in very new, “dark horse” cryptos available on some lending platforms might be extremely high. Furthermore, when you use DeFi lending protocols, you’ll also face the potential for impermanent loss, due to the volatility of crypto assets. Nevertheless, protocols usually assist with mitigating the losses by distributing a portion of the trading fees to liquidity providers.

Another important factor in the staking vs. lending comparison is collateralization. On lending and borrowing platforms, borrowers are first required to lend funds to the protocol as collateral for their borrowed amounts. Staking, on the other hand, involves no collateral.

Staking on Exchanges vs. Staking on Blockchains

If you decide to stake your crypto funds, your two main options will be via CEXs, and/or participation on a blockchain platform, which can be done directly by running a validator node or by joining a staking pool.

Running a blockchain validator node lets you earn staking rewards directly. However, the technical setup and minimum investment requirements are often significant. For example, to run a validator node 

 you’ll need to download the entire blockchain, be online at all times to avoid “slashing” penalties and run all the requisite software.

Financial requirements for validator nodes are also far from trivial. For instance, Ethereum validators must stake at least 32 ETH (

As an alternative to direct staking, you may join a staking pool such as 

 for ETH staking. These staking pool solutions allow users to stake with significantly lower technical and financial commitments. Many ETH staking pools also offer stakers a 

 that represents the staked ETH and its associated rewards, which can be used for various DeFi purposes.

 However, unlike direct blockchain staking, participating in a staking pool makes you dependent on that pool’s operator.

Instead of staking on a blockchain, whether individually or via a pool, you might consider staking via a CEX. For many crypto investors and users, the CEX route is more affordable, less risky and less technically complicated.

This is largely due to two key factors — the security of your funds, and customer support. Major CEXs are the largest crypto trading platforms in the industry. Their security setups and customer support provide key advantages over blockchains and DApps.

Any potential hacker attacks on a blockchain could lead to potential loss of funds. At the same time, you may use a custodial wallet on a major CEX so that your funds are at lower risk of being hacked. Naturally, CEXs aren’t immune to hacker attacks. However, the larger ones feature cybersecurity as a critical part of their business model. 

Following the insolvency of one of the world’s leading exchanges, 

, many major CEXs such as Bybit also include 

 (PoR) to make their holdings entirely transparent to the public. 

Thus, custodial wallets on these CEXs are relatively more secure as compared to noncustodial blockchain wallets.

Staking on a CEX may also help you access investment products with more stable and predictable rates and terms. For novice investors, it could also be a less complicated way to enter the world of crypto staking.

Additionally, staking on CEXs allows you to use coins that are normally not “stakeable” via a blockchain platform. Blockchain staking only works with cryptocurrencies based on PoS networks. For instance, the world’s largest crypto, 

 (BTC), isn’t based on a PoS network, so it can’t be staked on a blockchain.

Best Crypto Staking Coins for Highest Interest

The volatility of the crypto market means that there’s dynamic change when it comes to the best coins for earning interest. Regardless, the best interest rates in the staking game are normally available via CEX staking. Since CEXs offer a wide array of coins and products, there are often great deals available. 

CEXs also offer staking for popular stablecoins — such as USDT, USDC, DAI and more — that can’t normally be staked on a blockchain. In addition, some of these coins have great rates on offer. For example, Bybit’s current interest rate for USDT staking is 15%, one of the highest rates in general for staking.

The table below shows the top five coins available for staking on Bybit.

Coins are listed in descending order by interest rates. Interest rate and market cap data are valid as of 

Sep 14, 2023. (Data source — Bybit.com; Market cap data source — Coingecko.com)

Given the volatility of the crypto industry, the key to earning the best crypto interest rates is to keep an eye on the market and source the best deals as they arise. 

One way to deal with the inherent volatility of crypto markets is to invest using stablecoins. 

The leading stablecoins — USDT, USDC and DAI — are readily available for staking on exchanges, though not directly on a blockchain.

Some crypto investors, in chasing the best possible rates, move their funds in and out of centralized and decentralized staking and lending opportunities. However, this strategy might backfire, especially with smaller investment amounts, due to the fees involved in withdrawing and depositing your funds on some platforms.

Thus, to earn a higher interest rate in the long term, it’s best to choose a trusted platform in which to stake and hold your crypto, instead of moving your assets around.

Another important consideration for maximizing your returns is the type of interest rate applicable to a staking or lending product. Some of these pay interest based on APY, while others use the APR calculation method.

The key difference is that APR is a simple interest rate calculation that doesn’t take compounding into account. On the other hand, APY is based on compounding interest. All other things being equal, an 

 with the exact same numeric interest rate.

Interest rates on crypto investments do change over time. These changes can be abrupt, and quite substantial. This is particularly true for DeFi lending investments on platforms like Compound, which has algorithmic interest rates that can change within a single day. On the other hand, staking interest rates are comparatively less volatile.

Are You Eligible to Earn Crypto Interest? 

Before making your first investment, check your eligibility, as requirements may vary from platform to platform. As the first, obvious requirement, you need to have some actual cryptocurrency funds on hand.

On most established centralized platforms, you also need to satisfy 

 (KYC) and residency requirements. The residency requirement is particularly relevant for Americans, as some CEXs outside of the U.S. don’t provide service to U.S. residents.

 (DYOR) so that you understand the risks and technicalities involved in crypto staking and lending.

Part 2: How to Start Earning Crypto Interest on Bybit

Bybit is one of the leading crypto trading and investment platforms in the world, offering a wide range of interest-bearing products. To start investing with Bybit, you’ll first need to 

. You can register your new account with Bybit via email and mobile.

There are three main ways to buy crypto on Bybit: Peer-to-peer (P2P) service, fiat deposit and balance payment service, and credit card/bank transfer. 

The first option allows you to buy crypto from another Bybit user via Bybit’s 

. There are zero taker and maker fees for these transactions.

2. Buying Crypto With Fiat Deposit and Balance Payment Service 

 through the Fiat Deposit and Balance Payment service. There are over 10 fiat currencies available for this service, including euro (EUR), Brazilian real (BRL), Argentine peso (ARS), British pound (GBP) and Russian ruble (RUB).

3. Buying Crypto Using Credit Cards/Bank Transfer

Bybit also allows you to purchase crypto using credit cards and/or bank wire transfers with the 

You can directly deposit crypto funds into your Bybit account from a variety of centralized and decentralized sources — for instance, accounts on other exchanges, 

 page on your Bybit account’s homepage. From there, choose the

section. The available cryptocurrencies will be shown in this section. Click on

 next to the crypto you’d like to transfer to Bybit.

, you’ll see Bybit’s deposit address for the chosen crypto. Simply use this as the destination wallet address in your wallet or account on another exchange.

Part 3: 8 Ways to Earn Interest on Crypto With Bybit

There are eight key ways to earn interest or income on your crypto with Bybit. Let’s take a closer look at each one.

 1. Earn Interest on Crypto with Staking (Bybit Savings)

Bybit Savings is an investment product that allows you to stake crypto for interest. 

There are around 40 coins and tokens available for staking, including BTC, ETH, USDT and USDC. Choose between a flexible staking term, where you can withdraw your funds at any time, or a fixed term, which depends upon each crypto and is usually 30 or 60 days.

Bybit Savings is a great choice for risk-averse crypto investors. It provides a simple way to earn stable interest from popular coins and tokens, and you can even choose a flexible staking period. If you’re taking your first steps in the world of crypto investing — or generally prefer predictable and low-risk investment products — Bybit Savings might be the most suitable option for you.

Beginner

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How to Earn Interest on Crypto With High Yields

Bitcoin has been a lucrative investment for many, but its volatility makes it prudent to delve into comprehensive research and employ risk management strategies when investing in it.

 launched in January 2009, it’s turned many people into millionaires and has even created a handful of billionaires through their well-timed buy and sell transactions. More than that, Bitcoin has gained prominence as the future of 

 (DeFi) and has been adopted by many as a functional currency. Based on its astounding 

, Bitcoin is by far the most prominent cryptocurrency today and is often the focus of investors' interests.

Nevertheless, as is true with all digital currencies, Bitcoin is highly volatile, presenting investors with the chance for extraordinary profits as well as the significant risk of substantial loss. Bitcoin's price dropped by over 10% in August 2023 to $26,000, making it the worst month for the year. Additionally, Bitcoin's price plummeted to $16,000 in 2022, 75% below its all-time high of over $69,000.

With these factors in mind, we’ll explore whether Bitcoin is a good investment in 2023.

Bitcoin is the world's first successful cryptocurrency, created by a pseudonymous individual(s), 

, in January 2009. Developed as an alternative to fiat money, its decentralized nature empowers users with control over their wealth without relying on centralized institutions such as banks.

Bitcoin achieves decentralized consensus through its use of the 

 (PoW) consensus mechanism, which involves competing miners using the power of computers to solve complex mathematical puzzles to validate and confirm transactions and add them to the blockchain. This PoW mechanism ensures the integrity and security of the network.

Bitcoin is distinct from traditional investment options that you may be more familiar with, such as stocks and commodities. Unlike corporate stocks, which represent ownership in a centralized business entity that generates revenue from its products or services, Bitcoin isn’t a tangible, raw material. Instead, its core function is as a decentralized digital currency.

From a utility perspective, Bitcoin presents a transformative potential in the financial world by leveraging decentralized 

 to validate and secure its transactions. For example, Bitcoin transactions occur directly between users, without needing a third-party intermediary such as banks, which helps facilitate smoother, faster cross-border transactions. In addition, transactions recorded on the blockchain are immutable, which means they cannot be altered or reversed. These characteristics offer a high level of payment security and help to prevent fraud.

Yet, while Bitcoin is increasingly employed as a medium for purchasing goods and services, its adoption for such real-world transactions remains in its early stages. Some individuals may use Bitcoin for real-world transactions or as a potentially lucrative investment, but those in the broader crypto community mainly invest in Bitcoin to support the evolution of the crypto industry and the wider adoption of digital currencies.

There’s a fixed supply of Bitcoin’s native token, BTC. Specifically, the maximum supply is locked at 

. Currently, 19.48 million BTC are in circulation. Because of the limited supply of BTC tokens, Bitcoin’s value is solidly rooted in the fundamental economic principle of supply and demand. As demand for BTC increases, upward pressure raises the price. However, when demand decreases, the price of BTC correspondingly decreases.

Fiat currencies, which are widely used around the world, are also subject to price fluctuations based on supply and demand. However, banking systems can create more money, such as by extending credit to borrowers. In addition, governments can print more money. Both of these activities play a role in the value of fiat currencies, but these factors aren’t at play in determining Bitcoin’s value.

As a digital currency, Bitcoin has a few key characteristics.

With a fixed supply of BTC and with most of those tokens already in circulation, the scarcity of BTC plays a direct role in the value of this digital asset. In addition, Bitcoin has a halving event approximately every four years, after which the reward received by the network's miners is halved. After the 

, the payout to miners will be cut from the current 6.25 BTC to 3.125 BTC.

Halving plays a key role in contracting supply, and has historically had a profound impact on Bitcoin’s price. For example, the 2012 event took BTC’s price from $12.35 to $12 just five months after the halving. In 2016, the price went from $650.53 to $758.81, and in 2020, Bitcoin's price rose from $8,821.42 to $10,943.

Some strategy advisors suggest purchasing BTC roughly six months before a halving event and holding it for at least six months afterward. However, while BTC’s price has historically increased after halving events, it’s crucial to understand that all crypto investments are risky. There is no guarantee that the next halving event will yield the same impact on price as the previous ones.

 that entails solving complex mathematical equations to verify transactions, thereby consuming a substantial amount of electricity. This results in high operating costs because electricity drives the equipment necessary to mine Bitcoin — and to mitigate the heat that the mining machines produce. The combination of immense energy consumption and resultant high costs of Bitcoin mining creates a steep entry barrier to newcomers, ultimately driving up the price of Bitcoin.

As of Sep 12, 2023, Bitcoin remains the largest cryptocurrency based on 

, the second largest cryptocurrency, boasts a market cap of $189.95 billion. While Ethereum hasn’t yet surpassed Bitcoin's market cap, some crypto enthusiasts believe that the so-called 

Ethereum's recent transition from PoW to 

 (PoS) network, known as The Merge, positions it as a front-runner in the realm of 

 platforms. Those monitoring the possibility of a Flippening note that Ethereum has already surpassed Bitcoin’s number of transactions and amount of transaction fees paid — significant indicators of its growing utility and adoption.

Nonetheless, Bitcoin’s market cap has continued to rise alongside Ethereum’s, and the upcoming halving event will likely reinforce Bitcoin’s dominance.

The value of Bitcoin is heavily influenced by public interest, and both word of mouth and media coverage drive public interest. Interest in Bitcoin investing tends to accelerate rapidly when the price is trending upward. As more people invest in Bitcoin, the price increases further. Eventually, such speculation and grand hopes of getting rich quickly lead to a 

Short-term investors looking for a quick profit complete Bitcoin transactions rapidly at the first sign of a mass selloff, hoping to lock in what profit their Bitcoin investment has produced. 

Historically, the media has picked up on rapid rises in the price of Bitcoin. This can create an even greater frenzy in Bitcoin investing, even among those with minimal interest in the cryptocurrency market. However, just as the media begins to cover stories about rapid price increases, it also reports price drops —which contribute to panic selling, resulting in tremendous price decreases. In this way, public interest and media coverage can both feed into Bitcoin price surges and declines. 

A Closer Look at Bitcoin's Historical Performance

For cryptocurrency investors wondering if Bitcoin is a good investment, a review of its historical performance can be helpful.

In recent years, inflation and the printing of more U.S. dollars have contributed to increased interest in investing in the cryptocurrency market, due to Bitcoin's reputation as 

Bitcoin's strong market cap, investor demand and scarcity drove it to reach its all-time high of $69,000 in 2021. However, the volatility of the cryptocurrency market has yielded sharp declines in BTC’s price as well. For example, in November 2022, BTC fell to a low of $16,000 after the 

 brought about by several crises, most notably the 

Throughout its history, Bitcoin's price has been substantially influenced by overbuying and overselling. Those who invest in Bitcoin often focus heavily on market sentiment and media influence. However, volatility represents opportunities for significant profits among short-term investors. Additionally, Bitcoin’s price grew by an astounding 37,000% between 2013 and 2023, making it a potentially lucrative long-term investment as well.

As with other digital currencies, Bitcoin’s price took a deep plunge in 2022. Specifically, its market value declined by 65% in 2022, falling to $16,000 in November. Numerous macroeconomic factors took their toll on the crypto market in 2022, particularly the FTX debacle and the Terra/Luna crash.

The very first catalyst was the Terra/Luna crash in May 2022, when the third largest stablecoin, 

 (UST), depegged from the U.S. Dollar, dropping to a price of $0.035 on May 9. A few days later, its sister token, 

, which was meant to help maintain the price of UST, fell in value from almost $80 to barely a few cents. When Terra/Luna collapsed, it produced a 

The crypto market faced another devastating crisis in November 2022 with the collapse of one of the world's largest cryptocurrency exchanges, FTX, which filed for bankruptcy due to a combination of liquidity crunch, large withdrawal volume and fund mismanagement. The FTX downfall resulted in an estimated 

The ripple effects of these two crises raised the overall 

 (fear, uncertainty and doubt) as investors began to view crypto as a highly volatile and speculative asset, contributing to lower risk tolerance.

On Aug 1, 2023, the price of BTC was $29,233. It then fell to $26,042 on Aug 19. Several factors 

For example, SpaceX had reportedly sold a substantial amount (or possibly all) of its Bitcoin holdings, amounting to $373 million, early in the month. Additionally, the expectation of another Fed interest rate hike in the near future and increasing government bond yields may have contributed to negative crypto sentiment. Outside of the U.S., the devaluation of the Chinese yuan and the property crisis brought about by the downfall of Chinese property giant Evergrande produced downward pressure on Bitcoin's price.

While BTC is currently priced lower than its high of $30,000 in early 2023, this may actually be positive news for those interested in investing in it. Bitcoin has had numerous price dips throughout its history that have always been followed by substantial price increases. Given that a halving event will occur in April 2024, the current price dip could represent a fantastic opportunity to buy Bitcoin for a future profit.

Before investing in BTC, however, it’s essential to conduct both 

 to make more informed investment decisions. Bitcoin’s historical performance doesn’t necessarily guarantee that its price will rise again in the future, and numerous factors may create upward or downward pressure on its price. In addition, given the volatility of the crypto market, investors must practice caution by investing only what they can afford to lose.

Given Bitcoin’s volatile nature, it’s wise to proceed prudently with your investment in order to mitigate the risk of financial loss.

One way to reduce your risk exposure is to allocate a small portion of your total portfolio to your Bitcoin investment. Generally, a 1% allocation is a relatively low-risk investment, while investing up to 30% of your portfolio exposes you to a much more sizable loss if you sell Bitcoin at an inopportune time. Also, consider extending your portfolio to include stocks, bonds, real estate and other types of assets.

Buying low and selling high is the key to profiting from any investment, but this tack is particularly challenging in a highly volatile market. A proven way to tackle this challenge is with 

. Rather than investing a large amount at one time and hoping you hit the dip at its lowest point, you can make smaller purchases at regular intervals. 

It’s also essential to choose the right 

 to store your Bitcoin (hot wallet vs. cold wallet). A hot wallet is accessible on your phone or computer via the internet, and is typically provided by crypto exchanges. In contrast, a cold wallet lets you store your crypto assets offline. The accessibility of a hot wallet appeals to many investors, but the enhanced security of a cold wallet has considerable benefits as well. When choosing a cryptocurrency exchange for your Bitcoin transactions, it’s important to research the type(s) of wallet it supports. 

 allow investors to profit from investing in Bitcoin without actually needing to own the volatile asset. A Bitcoin ETF is a pool of funds from numerous investors that tracks and mirrors Bitcoin pricing, and is traded on prominent stock exchanges. Nevertheless, because Bitcoin ETFs are traded freely on an exchange, similar to stocks, their pricing can sometimes diverge from Bitcoin's actual net asset value.

 facilitate the purchase of Bitcoin, exchange Bitcoin for fiat currencies and are commonly located in major population centers worldwide. These ATMs function in the same way that traditional ATMs do, so you can expect absolute convenience with their speed and ease of use. However, they charge steep transaction fees of up to 20%, and offer little to no customer support when problems or questions arise.

As the largest cryptocurrency by market cap, Bitcoin is available for purchase on numerous cryptocurrency exchanges. Each cryptocurrency exchange has unique features and benefits that can directly affect your investment experience. One leading exchange is Bybit, highly regarded for its security measures. For example, Bybit has enhanced security functions to ensure the 

. Bybit also offers over 100 different cryptocurrencies, and more than 300 

Bybit’s intuitive dashboard makes it easy to buy Bitcoin. After 

, you can complete secure, quick purchases and trades without hassle. In addition, you can hold your bitcoins in an attached wallet or 

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