How to Buy Bitcoin? These may be the question on the mind of many that have not yet traded on the Bitcoin market venture. By way of introduction, Bitcoin is digital money void of bank fees, regulations, and other fees and rates. Bitcoin came up in the year 2008 by a not popular group of persons or persons with the name Satoshi Nakamoto.
Although till now the true identity of the creator of Bitcoin is yet to be known. To many investors out their investment in bitcoin is very risky and the future cannot be comprehending. Yet every year the crypto coin increases in value.
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Bitcoin investment is complicated and it’s much better when you know all the intricacies of the market. However, the market is much easier nowadays to engage in legitimate and secure.
How to Buy Bitcoin
Bitcoin is a digital Cryptocurrency or a virtual currency, it’s totally virtual. Also, it is like an online version of cash. It can be used to purchase products and services although not accepted by some stores and other countries have banned it from being used already. However, some influential companies have started buying into the Bitcoin growing market.
Every Bitcoin is just a file stored in a digital wallet’s app on any device like a computer or any smartphone. Each transaction is computed in a list known as Blockchain. With this, you can conveniently trace the history of Bitcoins. Also, to block the use of coins by persons who do not own any and from making copies or revoking transactions.
What to Know Before Buying Bitcoin
For every new or aspiring investor, there are things to know. You must have a cryptocurrency exchange account, personal identification documents when you’re using a KYC (know Your Customer) platform. Get an Internet connection and a method of payment. Also, you must own a personal wallet outside the exchange account.
A valid method of payment using this path includes bank account s credit cards and debit cards. Also, you can get Bitcoin at specializing ATMs and through P2P exchange. But Bitcoin ATMs require government-issued IDs.
Another thing to take note of is your privacy and security. Investors need to keep their Bitcoin with ought most security measures. Avoid bragging about your Bitcoin holding. Especially, if you use the public internet to access your account, anyone can steal from you, when they know of your balance.
Keep your private keys secret, against criminals’ attacks. Anyone that gains access to your private key on the public address on the Bitcoin blockchain can authorize transactions. Another point is never to use your credit card to buy Bitcoin.
Using your credit card to purchase Bitcoin is never the best. A credit card is making an investment by borrowing from a high interest rate which is not a good idea. Make your personal information handy while setting up a cryptocurrency account. Information such as your social security number and your bank account number, debit credit card to fund your Bitcoin account.
Steps to Buy Bitcoin
Looking down this paragraph, you will see different ways on how you can buy or get Bitcoin starting with the very first method below.
Choose an Exchange
When you sign up to get cryptocurrency exchange will permit you to hold, buy and sell cryptocurrency. Generally, it’s a good practice to use exchanges that grant you access to withdraw your crypto to your own personal online wallet for your security.
There are several kinds of cryptocurrency exchanges, but the most popular ones. These ones are not decentralized and do not need KYC. These exchanges are in the United States there are Coinbase, Gemini, Kraken and Binance U.S., and others.
These ones have grown over the years with significant features. Kraken, Gemini, and Coinbase offer Bitcoin and another growing number of altcoins. And these three render the easiest service on cryptocurrency in the industry while Binance services a more advanced trader, by rendering more advanced and serious trading and various altcoins to select from.
Importantly know that when you’re creating a cryptocurrency exchange account you need to use secure Internet practices. Activate a two-factor authentication and when using a password make it unique and long. You may include different lowercase letters, capitalized letters, special characters, and numbers.
Connect Your Exchange to A Payment
After you have submitted your personal information depending on the exchange, you may need to submit your driver’s license, social security number. Also, with your employer’s information and source of funds base on your region.
However, after all these processes by the exchanges, you can connect your bank account directly or connect your credit or debit card. Although it’s legal especially in the US some banks do not want to associate with anything crypto-related sites and exchanges. Therefore, it’s ideal to check first that your bank support deposit at the exchange you choose.
Also, there are various fees for deposit through bank account, credit, or debit card. For beginners, Coinbase is a good one with low bank fees and low fees for credit and debit cards. Always check the fees with each payment option to help choose an exchange or choose one that’s best for you.
Place an Order
Once you are through with choosing an exchange and connect to a payment option. You can now place an order to buy Bitcoin and other cryptocurrencies. Crypto exchange now offers a few numbers of other types and means to invest.
Kraken grants access to market, limit, stop-loss, Stop-limit, take–profit, and take-profit limit orders. Exchanges offer means to set up recurring investment allowing clients to dollar cost average into their investment of choice.
Bitcoin like other cryptocurrencies is stored in wallets. If you use the outside exchange to store your Bitcoin then ensure that it’s only you that can access your private keys. When selecting a Bitcoin wallet, you have to choose the one that you can easily access. There are Hot wallets (online wallets) and cold wallets (Paper or hardware wallets).
Know that some wallets have more features than others. Some may be only for Bitcoin while others can store more than Bitcoin and other altcoins. With some wallet, you can swap one token for another.
Simply put, a cold wallet is not usually connected to the Internet. They are built with software that operates parallel to enable users to view their portfolios without using their private keys. However, the most secure way to store cryptocurrency offline is by using a paper wallet. Paper wallets can be generating off from some websites.
This can then produce both private and public keys that can be print on paper. To access cryptocurrency using the address attached to the account, a printout paper with a private key will be required. Some people laminate the paper wallets and keep them in safety deposit boxes in a bank or at any place highly safe.
A cold wallet is for high-security for long-term investment, also you cannot trade or sell off a fast Bitcoin store with the cold wallet. A hardware wallet is a typical example of a Cold wallet, using a USB cable drive to store the private keys offline
A hot wallet is known as online wallets. Hot wallets are 5hose wallets that are used on the internet with your mobile phone, tablets, computers. It seems vulnerable since it’s online and it stores the private keys to a coin on the devices.
Although the hot wallet can be very convenient especially when you want to access and carry out transactions quickly. But storing your private key online makes it very vulnerable to hack.
This is reality, investors using hot wallets need to apply strong security or their fund can be stolen. You have to avoid boosting if the amount of Bitcoin you’re holding in public platforms like Facebook, Reddit, and others.
You have less strong security to back up your wallet. However, your wallet can be safe when you apply precautions like having a strong password, using secure Internet browsing and two-factor authentication, and any other available.
In setting up your wallets you will need an exchange account to buy and sell. A hot wallet to hold the small or medium amount of crypto that you want to sell and trade. A cold hardware wallet for storing a large amount of Bitcoin for the long-term season.
Alternative Means of Buying Bitcoin
There are other alternative channels to buy Bitcoin and there are:
- By using PayPal.
- Credit card.
- Bitcoin ATM.
- P2P Exchanges.
All these are alternative channels to buy Bitcoin.