How to buy Bitcoins?
The financial allure of cryptocurrency in today’s market is not based only on the increasing value and return of the chosen currency. Even though profit is the primary goal, as with any other trading instrument, cryptocurrency is more than just the favourite subject of the hour. Your transactions are secure, safe and, most importantly, in your control, which is why you need to know how to buy Bitcoins.
When you understand the mechanics of buying and selling cryptocurrency, your whole view on trading will change. In this chapter, we will thoroughly explain the investment opportunities and benefits of cryptocurrency trading. We will focus on teaching you how to buy and what methods you can use to complete financial transactions.
We use the Bittrex digital exchange based in the USA. They are fully compliant with financial regulations. You can buy Bitcoin using already established methods like Paypal, Cash, Credit Cards (Debit Cards) or Zebpay. After the initial purchase, on Blockbid you can exchange your Bitcoins for Ethereum, Ripple, Neo, Litecoin, Factom, OMG or Sia Coin. Let’s dive into it!
Since April 2013 (the Cypris crises), Bitcoin became a popular subject for financial advisors and everyone else with turnover interests in mind. Mining Bitcoins became more of a cost and a burden than ever before with the increasing number of miners.
Five years later, mining turned out to be impractical and very expensive. Thus the buying, trading and selling cryptocurrencies concept gained traction. It is easier, faster and smarter to trade Bitcoins than to mine them in the current financial climate.
The possibilities you will encounter in the growing and continuously evolving market of cryptocurrencies are varied. The main thing you need to do to get a piece of the action is to buy Bitcoins — the APEX cryptocurrency. Bitcoin functions as the link between money and other cryptocurrencies, so to get on the market, you have to purchase some Bitcoins first and store them in your cryptocurrencies wallet.
How to buy Bitcoins using Paypal?
Elon Musk was one of the co-founders of PayPal, so is not surprising that this online paying method has changed the way we do business. What is surprising, though, is why it is still hard to buy Bitcoins with PayPal, even in 2018. For a concise history lesson, since September 2014, PayPal started allowing Bitcoins as payment through PayPal’s Payments Hub. However, buying them with PayPal is still a bit of a hassle — possible but not simple.
How to buy Bitcoins using Paypal?
You can opt to create an account on VirWoX (Virtual World Exchange) where you can buy SLLs (Second Life Lindens) used as a currency in the virtual world of Second Life. It sounds a bit complicated, yes, and that is why it is recommended for people that have a bit more experience with trading through these channels.
However, don’t get discouraged. If you want to use your PayPal account to buy Bitcoins, we will show you how, step by step.
- Step 1 – Register on VirWoX - When your account is activated and confirmed after the initial 24 hours, you can deposit money and start trading.
- Step 2 – Deposit money into your VirWoX account via PayPal.
- Step 3 – Buy the SLLs (Second Life Lindens) on the SLL/USD exchange — this is possible on VirWoX, which is why you are using this exchange in the first place.
- Step 4 – Buy Bitcoins with your SLLs on the exchange — after that, you can withdraw them if you wish.
The good news is that this is a method that has been proven by now and is reasonably reliable. The bad news is that the fees are high (around 3 percent on an average), and it can get complicated if you do not have the experience needed for these types of purchases.
What is the legal background of this transaction? You can use PayPal to buy SLLs, and then SLLs are used to purchase Bitcoins. So, what you are doing is adding one more step to your final goal. Bitcoin is not directly sold to you, as a buyer.
A note of importance when it comes to selling Bitcoins through PayPal — you will not be protected with the PayPal’s Seller Protection described in their User Agreement. They offer protection only for physical, tangible goods that can be shipped, so you need to be cautious if you start using this platform for buying or selling any cryptocurrencies directly.
How to buy Bitcoins using Cash
It might surprise you, but yes, you can use cash to buy Bitcoins. It is a more private process than all of those listed above, and it does not require you to reveal sensitive personal information. Also, it is the safest. You can buy them locally from someone who is willing to sell, or you can take a safer route and use exchanges that accept cash deposits.
How to buy Bitcoins using Cash?
If you decide to buy or sell your Bitcoins locally, then the seller transfers the Bitcoins to the public address of the Bitcoin wallet, and the buyer pays in cash. If you use some of the exchanges listed above, they act as a mediator in the transaction, like LocalBitcoins, for example.
How to buy Bitcoins using Credit Cards or Debit Cards
The main issue since the beginning of 2018 is that big banks like Bank of America, JPMorgan, Citigroup and Capital One have been blocking cryptocurrency purchases with credit cards. Debit cards are not affected by this ban. Even though this is a self-serving mechanism for the banks (leveraged exposure to cryptocurrencies), it does insert a more significant financial control over buying Bitcoins.
How to buy Bitcoins using Credit Cards or Debit Cards?
It is straightforward and convenient, and there is no need for a tutorial since you have been purchasing with your credit cards every day. The bad side of it is that the fees you will have to pay are considered quite high.
You can use a lot of different exchanges like CoinBase, CoinMama, BitPanda and CEX. In the next section of the guide, we will explain in detail the pros and cons for each of these exchanges, but for now, let’s focus on the risks.
There is always the possibility of fraud, but if you use reputable exchanges, then the risk is much lower. One of the central questions still revolves around the six-month reversed charge policy. The way to get past the “danger of this policy” is with the EFT transfer from a bank account (not reversible).
Also, there are limitations on how much Bitcoins you can buy with a credit card/debit card weekly. Moreover, additional verification processes are required if you wish to exceed that limit.
For example, CoinBase has limitations because they want to prevent fraud and are compliant with regulatory laws. The limit is calculated upon different factors like age, purchase history, payment method and others.
Buy Bitcoins through a Bitcoin ATM
Bitcoin ATMs are a relatively new concept that works almost the same way regular ATMs do, or you buy Bitcoins through them. They are very convenient, accessible and on their way to become the new trend in the world of cryptocurrency.
How to buy Bitcoins using Bitcoin ATMs?You can buy Bitcoins very easily. You deposit cash in the ATM, and it converts it to Bitcoins. You will need to show your wallet QR code so the Bitcoins can be deposed for storage. However, they charge 3 to 5 percent moreover the average exchange rate.
Since the beginning of 2018, the cryptocurrency market is valued above $700 billion. It is an industry which is yet to be strictly regulated, but it is thriving, nonetheless. One of the ways to become a part of it is through Bitcoin exchange, where you directly pay money and get the coins. The basis is the same as in the stock market exchange, but instead of buying regular stocks, you buy Bitcoin.
The most crucial counsel financial advisers give to clients, for choosing an exchange is to go with the ones based in the USA, Britain, Canada, Australia or Europe because of the legal protection. Blockbid uses Bittrex for those very same reasons, but let’s give you a general overview of the subject.
There are mainly two types of exchanges: The ones where you buy Bitcoins for fiat currencies (Dollars, Euros and other government-issued currencies), and the ones where you buy cryptocurrencies for other cryptocurrencies. In this section of the guide, we shall focus on the first ones, where you use your Dollars to purchase Bitcoins.
How to buy Bitcoins through a Bitcoin exchange?
You have two options.
- You can buy Bitcoins from the exchange - When you register (create an account), you gain the possibility to buy the coins at a rate provided by the chosen Bitcoin exchange. The process of registration with an exchange can sometimes require more personal information (ID, proof of address, etc.) because of know-your-client (KYC) and anti-money-laundering (AML) laws.
- You can buy Bitcoins directly from other sellers on the exchange – The main difference here is in the rate, so when you buy from other sellers, you might get a better price. In order to be competitive, sellers usually give you lower rates.
You can buy and sell Bitcoins as you wish once you get an account on an exchange, just like you would do with your stocks. It is essential to remember to use already affirmed exchanges like CoinBase, CoinJar, Unocoin, BitStamp, Kraken and Circle. We even have a few tips to help you choose the right one:
- Find a verified local Bitcoin exchange to avoid currency conversion charges and discrepancies in law regulations. It is always recommended to select an exchange in your home country.
- As your lawyer would say: Always read the fine print regarding the terms of service. This tip is vital in more ways than one, from currency conversion to rights and obligations arising from your purchases.
- Transparency, liquidity and audit information should also be on your checklist.
- Go for an HTTPS secure exchange.
We prepared a list of the best Bitcoin exchanges if you want to know more about this topic, and also, in the next chapter, we are going to cover how to buy Bitcoins in Australia.