How To Buy Bitcoin: 6 Actionable Steps To Buy Your First BTC

Feb 25, 2020
12:02
2 min reading

Choise.com team

There are plenty of reasons why you might consider buying Bitcoin this year. For starters, the Bitcoin halving 2020 — an event that reduces by half the BTC mining reward — is expected to unleash massive growth for the world’s most popular cryptocurrency.

The increasing institutional interest in digital currencies seen in 2019 is also reshaping the commercial space, with more customers and businesses willing to give cryptocurrencies a chance and accept Bitcoin as an alternative payment method.

With price predictions pointing at attractive price levels, it’s only natural for people to wonder whether it is time to buy Bitcoin. However, the number of options out there can be overwhelming for those giving their first steps in the cryptocurrency world.

What are the best places to buy Bitcoin?
When is the best time to buy Bitcoin?
How do I buy Bitcoin with a debit or credit card?

How To Buy Bitcoin

If you are having serious doubts about how to get started with Bitcoin, you’ve come to the right place. In this short guide, we will answer some of the most important questions and walk you through 6 actionable steps to purchase your first Bitcoin.

#1 — Do your research

Yes, cryptocurrencies are global by nature. But that doesn’t mean you can buy them from any company around the world. At least, not for now.

The options available may vary based on your current location. If you live in Iran, then you wouldn’t be able to access Localbitcoins — a leading peer to peer marketplace — to buy Bitcoin online. For those based in the United States, finding a company to buy Bitcoin could be challenging, depending on the state you live in. For example, New York residents could buy Bitcoin using a service such as Changelly, but not the people from Florida.

Hopefully, global solutions are slowly emerging in the cryptocurrency space. Crypterium is one of them. With a single app, you can buy Bitcoin instantly at market rates in over 180 countries.

Of course, purchasing Bitcoin from an established company isn’t the only alternative. There are three ways you can get hold of Bitcoin nowadays:

Buying from a regulated company (e.g., Crypterium)
Buying in a marketplace (e.g., LocalBitcoins)
Buying from a Bitcoin ATM (e.g, Athena)
Buying from an individual (e.g., your neighbour)

Each of these alternatives offers a different level of risk. Buying Bitcoin from an individual might sound like an easy way to handle it, but this method offers no guarantees at all.

	Company	Marketplace	Bitcoin ATM	Individual
Buyer Protection	High: all purchases are delivered and insured	Medium: only guaranteed if you use escrow	High: all purchases are delivered and insured	Low: no guarantees for the buyer to get BTC
Payment Options	Bank transfers, credit or debit cards	The seller selects a preferred payment method	Fiat money (only local currency), credit or debit cards	The seller selects a preferred payment method
Execution Speed	Instant	Minutes to Hours	Minutes to Hours	Minutes to Hours
Exchange Rate	Market rate	Price by seller	Market rate	Price by seller
Service Fees	2% to 10%	No fees to 1%	10% to 18%	No fees
Availability	24/7	24/7	24/7	On request

#2 — Sign up for a Bitcoin wallet

Once you’ve decided which service works best for you, it’s time to sign up for a cryptocurrency wallet. Simply put, a cryptocurrency wallet is a digital wallet that stores your BTC.

One of the simplest ways to identify the best crypto wallets is by comparing the offered services. Then, you should clearly understand whether those features fit your lifestyle.

As a general rule, we suggest going for cryptocurrency wallets that offer a wide range of services. Even if you are only getting started, having additional services such an in-built cryptocurrency exchange, express payouts, and even mobile top-ups will do no harm.

If you plan on investing long term and you need somewhere to store and eventually buy more cryptocurrencies, wallets like Luno or Crypterium allow you to buy Bitcoin (and other digital currencies) straight from the wallet.

#3 — Verify your profile [optional]

This step is optional, as not everyone feels the same way about sharing personal data. However, verifying your profile usually comes with a bunch of benefits attached.

Most cryptocurrency services will raise your limits only after you verify your profile. For instance, an unverified user could purchase much as $150 worth of Bitcoin, while a verified client could buy up to $10.000 depending on the service.

Verifying personal details is also a great way to avoid unnecessary blocks on your account due to suspicious transactions. Overall, taking the time to submit your documents and verify some basic information pays off.

In the cryptocurrency space, it’s essential to operate with services that have KYC and AML policies in place. If a company isn’t compliant with those policies and you still decide to work with them, you will be exposing your funds to very high risk.

#4 — Select a payment method

The most popular choices when it comes to payment methods are credit and debit cards because they are processed immediately, meaning the delivery of your Bitcoin will take no more than a couple of minutes.

Wire transfers are still available, but the settlement of such transactions tends to be significantly slower. Also, the bank might charge you a fee for transferring the money.

As for cash, it’s a risky choice. The only Bitcoin sellers that will accept cash are individuals. Since cash offers no traces, there are no guarantees the seller will deliver the BTC as promised.

#5 — Keep your Bitcoin safe

Depending on which purchase method and service you’ve chosen, your Bitcoin will likely be delivered in a matter of minutes. If you’re using a third-party service like Simplex, you can introduce a bitcoin address where you want your BTC to be sent. For those using cryptocurrency wallets with a purchase feature, the amount will be credited instantly.

Regardless of the service you’ve selected to purchase and store your cryptocurrency, always make sure funds are insured. For example, all Crypterium accounts are insured with BitGo against security threats meaning you’ll be compensated in case of any losses.

#6 — Earn interest on your Bitcoin

Congratulations. Now that you’ve become a crypto holder, there are plenty of things you can do to increase your holdings. While trading might be the fastest way, it also comes along with high risks.

If you would like to earn additional Bitcoin without putting your holdings on the line, a crypto savings account is a great choice. At the moment, Nexo is one of the best alternatives on the market as it offers a stunning 8% interest. The only downside of this service is the limited number of features available apart from crypto lending and savings.

Hopefully, companies with a broader approach like Crypterium are developing their own savings accounts to provide customers with passive income.