How Can I Buy Bitcoin?
Purchasing bitcoin on a cryptocurrency exchange is as simple as using an online brokerage account to place an order.
An rising number of investors are wanting to invest in bitcoin and other cryptocurrencies as blockchain technology continues to acquire confidence and popularity.
If you’re thinking about buying bitcoin, especially if you’re a newbie, here’s a rundown of your options for buying bitcoin and other cryptocurrencies, how to trade and hold (or “HODL”) them, and how to keep them safely.
- Buying Bitcoin Through a Cryptocurrency Exchange
- Other Ways to Buy Bitcoin
- I Successfully Bought Bitcoin. Now What?
Buying Bitcoin Through a Cryptocurrency Exchange
Creating an account on a reputable cryptocurrency exchange is the simplest and safest way to acquire bitcoin. Users can purchase, trade, and store their bitcoins on cryptocurrency exchanges.
Funding your account and making a purchase works in a similar way to a standard online financial exchange or brokerage account. Most of these platforms charge a fee for each order you place and when you withdraw your funds, and most of them make their cost structure public for transparency’s sake.
The following are the fundamental procedures of purchasing cryptocurrency on a cryptocurrency exchange:
Choose a cryptocurrency exchange: When choosing a cryptocurrency exchange, it’s crucial to know which exchanges are permitted to function legally in your country and to only transact on one of them.
This information is normally available on the website of trustworthy exchanges. Furthermore, each crypto exchange has its own anti-money laundering (AML) policies, requiring different levels of Know Your Customer (KYC), a regulatory compliance process that requires businesses to verify their customers’ identities, typically through the use of a passport, driver’s license, or other form of official identification. Prepare to comply with the unique KYC criteria of your preferred crypto exchange.
Connect your account to a payment option: After you’ve completed KYC and created an account, you’ll need to link it to a payment method like a debit card or a bank account. While this procedure is quite simple, it can be time consuming at times. It’s also worth noting that not every exchange offers fiat on- and off-ramps.
To put it another way, certain exchanges enable users to buy cryptocurrencies with fiat currency, while others only allow crypto-to-crypto trades. If you want to buy bitcoin with fiat, make sure to use an exchange that allows you to do so.
It’s also worth mentioning that depending on how you fund your account, each exchange has various costs and fund settlement times. As a result, it’s critical to conduct thorough research and select a payment method that best meets your investing requirements.
Other Ways to Buy Bitcoin
While crypto exchanges are by far the most popular way to buy bitcoin and other cryptocurrencies, bitcoin may also be purchased via specialist ATMs and through peer-to-peer (P2P) decentralized finance (DeFi) exchanges like Uniswap, Balancer, and Aave.
However, depending on where you reside, locating bitcoin ATMs can be difficult because they are not as common as standard ATMs. Interacting with DeFi protocols sometimes necessitates some level of technical knowledge or familiarity with these platforms, which can be difficult for newcomers to the crypto world.
While it is possible to buy bitcoin at a dedicated ATM or through a DeFi platform, most individuals prefer to acquire cryptocurrency from a reliable crypto exchange.
I Successfully Bought Bitcoin. Now What?
What you do with bitcoin once you’ve purchased it is entirely up to you. Some investors swap bitcoin for other cryptocurrencies right away, while others prefer to store it in their exchange wallet or withdraw it to a hardware wallet for self-custody.
Whether you want to trade or “HODL” your bitcoin, make sure to follow best practices when setting up your cryptocurrency exchange account or monitoring your hardware wallet to protect your investment’s safety and security.