Crypto has turned into one of the most popular investment methods in the present moment; it was created as a decentralized digital exchange method apart from government institutions powered by blockchain technology. Due to its increasing popularity, knowing how to manage it is now essential for more people worldwide every day.
But before we go deep into how to buy diamonds with cryptocurrency, let’s go over a few relevant pieces of information.
What is cryptocurrency?
Crypto is a digital peer-to-peer currency that started in 2009 with Bitcoin and has evolved rapidly, becoming so relevant that it is now treated as legal tender in countries like El Salvador, where it has potential to lift the national economy.
What started with just Bitcoin has since turned into over 500 official cryptocurrencies, a number which keeps increasing as more and more people are creating their own.
What is blockchain?
Blockchain is an open, coded record of financial transactions encrypted and distributed to numberless computers all around the globe. Each of these transactions is recorded on a “block.” All the movements recorded are put together into “chains” with previously recorded transactions.
Cryptocurrency as digital tokens for purchases
Although crypto is now becoming part of the mainstream, the services or products you could exchange this currency for were limited until recently. Today, well-known companies like Microsoft, Visa, PayPal, or Amazon are incorporating cryptocurrency into their accepted payment methods.
While the number of industries integrating crypto into their payment means is expanding, the jewelry industry is on the rise, and if you’re thinking, “Can I buy loose diamonds with cryptocurrency?” the answer is yes. Right now, you can get loose diamonds and gold ingots in exchange for your bitcoin.
How to pay for jewelry with cryptocurrencies?
We already covered the basics of how crypto works; so by now you might be wondering, “How do I pay with cryptocurrency?” and although you might think that using crypto as an actual payment method is complicated or time-consuming, it’s actually pretty easy.
Let’s say you’re trying to buy luxury diamonds with bitcoin.
First, you need a bitcoin wallet; there are many options available depending on your needs. Coinbase, Trezor, and Ledger are some of the top apps for bitcoin wallets; getting an account with them is quick and easy.
Once you have your bitcoin wallet set up, you have purchased the currency of your preference, and you know for sure that the online provider you’re buying from accepts bitcoin, all you need to do is introduce their bitcoin address into the predesigned field in your wallet, enter the amount you’re paying, and submit it. It’s just like transferring money through your bank’s app.
If your provider doesn’t accept bitcoin directly, you can still use those assets to purchase jewelry. All you have to do is transfer your funds to a cryptocurrency debit card, like BitPay. Remember that transactions with bitcoin are not immediate since they need verification by proof of work or proof of stake, which can take a couple of hours or less depending on the cryptocurrency.
Digital gold vs. real gold
Cryptocurrencies are achieving such approval in the financial world that some are calling it “digital gold.” But how real is this compared to the effectiveness of investing in high-quality jewelry?
Well, it is indisputable that cryptocurrencies are increasing their value constantly, setting standards that weren’t seen before, but whether it will stay this way long-term is uncertain. So treating cryptocurrency as a saving method for the future, believing that it will continue to increase its value as it has done before, might not be the best choice.
Since it is a very volatile investing option, there is a chance that the price of cryptocurrencies could fall apart and become money lost for those who invested all their assets in it. So you shouldn’t invest money you’re not ready to lose in crypto.
But an intelligent investor knows that diversification is the key to bettering your chances in the long-term. So a good way of approaching crypto is as a medium-term investment. Once the currency you got for a reasonable price increases its value, you can exchange it for other valuable assets that result in suitable investments in the long term.
Jewelry has been one of the most popular investment opportunities for decades since the value of the materials it is made of continues and is expected to continue increasing its price for years to come.
The actual difference between jewelry and bitcoin as an investment is that the materials used for jewels are limited and cannot be created at will and in an unlimited way; cryptocurrencies can, so they tend to change their value constantly.
While experts hold mixed opinions on crypto’s future, it is undeniable that right now it is one of the most profitable investing methods you can put your money in. And now that you can use it as an exchange currency, the options for diversifying your investments are more comprehensive.
Now you know more about jewelry and blockchain, and you can use this information to build your future assets on diamonds or gold using cryptocurrencies.