You want to buy Bitcoin but you aren’t sure the best way to do it.
Thankfully, buying Bitcoin is super easy when you use our 4 step guide.
So if you want to get bitcoins fast, just follow the steps below and you’ll be a Bitcoin investor in no time!
The first part of buying Bitcoin is finding a proper exchange.
Exchanges come in many forms.
Some allow you to buy from other users on the exchange platform. Others sell bitcoin to you directly. We are going to focus on these because they are the easiest to use.
Some examples of exchanges
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When deciding on an exchange, there are other factors to consider:
You need to make sure to choose an exchange that supports your local currency (such as US Dollars, Euros, or British Pounds). This is obviously really important because if you can’t deposit your local currency, you can’t really buy any bitcoin in the first place. So make sure to check the exchange will accept your local currency before signing up.
You may have a specific payment method in mind for how you’d like to pay for the bitcoin. For instance, you may want to pay with a credit card, but many exchanges only support some form of bank transfer.
For example, below you can see Kraken doesn't support Paypal or credit card purchases
Most exchanges don’t support every payment method, so do some research on that as well before you sign up.
Make sure the exchange supports your country. This is similar to choosing an exchange that supports your local currency, but it’s not exactly the same. Some countries share a currency with other countries, such as the Euro. While an exchange may accept one of those currencies, there may be local laws or regulations in your country that prevent the exchange from operating there.
For instance, while Coinbase does support Euro deposits, it does not support Austria.
So you’ve found an exchange that you like. It supports your country, your currency, and your payment method.
The second part of buying Bitcoin is selecting and setting up a payment method to pay for your Bitcoins on the exchange of your choice.
The process of setting up a payment method on an exchange is going to be a little bit different from platform to platform.
But for the most part, the process is pretty similar.
After you sign up and verify your identity, you’ll likely see a billing option in your account settings where the platform will list all the options.
If you don’t see these settings, you may need to attempt to make a bitcoin purchase before you can set up your payment method. If so, go and skip to the next step and then come back here once you are done.
Either way, select your desired payment method and follow the prompts on your screen.
If you are using a credit or debit card, you will input the card information just like you normally do when making a purchase with your card online.
You may need to verify the card the first time you use it. If so, the exchange may make a couple of small charges on your card and then make you report back what the charges are.
This helps them verify that you are actually the owner of the card.
If you are doing a bank transfer, there will be another form to fill out. Here you input your banking information so that the platform can draft your account for the amount you specify.
These days, many exchanges use a service like plaid to allow you to securely log into your bank account from within the platform and authorize the transfer.
This process can take a few days, but it’s usually the cheapest and near every exchange supports this payment method.
The wire transfer is similar to the bank transfer except you will tell your bank where to send the money instead of the exchange platform doing it.
The exchange will give you a set of instructions and their banking info and you will need to log into your bank account.
Once logged in, you’ll need to initiate a wire and provide the exchange’s banking info into the wire transfer form.
This form of payment is faster than a bank transfer, but it’s also fairly expensive. Sometimes you might pay $25 for a single transfer.
If you need to buy bitcoin fast, but don’t want to pay the 3% fees that credit card bitcoin purchases charge, this can be a good option.
Other options for buying bitcoin include:
Again, all of these methods vary country to country and exchange to exchange and each have their own pros and cons.
Do your research for the best method then follow the guidelines for setting it up on each exchange and you will be good to go!
Now, you’ve picked an exchange and you have your payment method set up.
It’s time to buy some bitcoin!
The third part of buying Bitcoin is placing your order.
Like setting up payment methods, the process of making an order is a little different on every exchange, but the steps are generally the same every time.
First, you will select the ‘Buy’ option on your exchange or broker site.
You then need to select the crypto you want to buy.
In our case, we are choosing Bitcoin. However, many exchanges offer other coins.
Don’t get fooled by other options like ‘Bitcoin Cash’, ’Bitcoin Satoshi’s Vision’, or ‘Bitcoin Gold’. These are not Bitcoin, but ‘altcoins’ designed to look like Bitcoin and trick new people into buying them by mistake.
Second, we need to tell the platform how much of the coin we’d like to buy.
Now, just hit the buy button.
You’ll be taken to a confirmation screen where you will see a total of the coins bought and what you paid for them along with any fees and other charges.
You’ve selected an exchange, you’ve set up your payment method, and you’ve made your first bitcoin order.
Now the real fun part begins. The part that makes holding bitcoin unique among all assets you can buy.
You can hold it yourself.
That’s why the fourth part of buying Bitcoin is moving the coins to a wallet you control, such as the Trezor hardware wallet shown below:
The topic of bitcoin wallets is very deep and complex, but here are the basics.
Here are some of our favorite wallets
There are a couple of reasons you want to withdraw your coins onto your wallet and out of your exchange after you purchase them.
First, the thing that makes bitcoin valuable is the ability to store it so that no one can control your money but you.
With a traditional bank account, the bank holds all your money for you and can freeze your bank accounts at any time.
Just take a look at the headlines below to see for yourself:
In bitcoin, this is impossible as long as you store the coins in a wallet you control.
But, holding your coins in an exchange is like holding dollars in a bank account. The exchange could freeze your account or the exchange owners could just run away with your money.
In fact, it’s happened before:
The second reason you want to withdraw is because exchanges are what we call ‘honey pots’ for hackers. This means that, because exchanges often hold thousands and sometimes tens of thousands of bitcoins, they are prime targets for very sophisticated hacking attempts.
When successful, exchanges can have their wallets drained, meaning you lose all your bitcoins. Your best bet at that point is to hope the exchange pays you back, but that is never guaranteed.
Again, this is very common:
So now we know why we want to withdraw our coins to a wallet we control.
How do we do that?
The whole process is actually pretty simple.
Each of these wallets has its own set-up process and the tutorials for each of these are very user-friendly and easy to follow.
Once set up, you want to go to the ‘receive’ tab on your wallet.
Here you will generate a receiving address. This should happen almost immediately and without much more effort on your part aside from selecting the ‘Receive’ tab.
The receiving address will look like a long, random series of numbers and letters. You may also see a QR code version of the address (the example below is blurred for privacy reasons).
This ‘address’ is much like an email address. Anyone who sends bitcoin can put this series of letters and numbers into the to “To:” field and you will receive those bitcoins.
Since you are sending them to yourself from your exchange account, you will be filling out the send form on your exchange account.
Copy this address and log into your exchange.
Now that you are logged into your exchange account, try to find a tab called “Send”.
This may be in your portfolio dashboard.
A form will appear where you need to select the coin you want to send - in our case, bitcoin.
Then you need to tell the exchange how much to send. Here you want to send all of it.
In the receiving address field, paste the address you copied from your wallet in step one.
Now hit ‘Send’ or ‘Confirm’, and you are all done!
Maybe you’ve been holding your bitcoin for awhile and now you want to take some profits from your gains.
The process of selling bitcoin is almost the reverse process of buying it.
The first thing to do is get your exchange account receiving address for the coin you want to sell.
NOTE: make sure you don’t accidentally choose another coin, or you might lose the coins forever. For instance, do not send Bitcoin to a Bitcoin Cash address on your exchange.
Log into your exchange account and copy your receiving address.
Now, open your wallet and go to the ‘Send’ tab.
Choose how much of your Bitcoin you want to sell and input that into the send form.
Next, paste in your exchange receiving address.
Finally, set your fee. The higher the fee you pay, the faster the coins will get to the exchange. It’s usually best to use a fee estimator to get the most bang for your buck on fees.
Now hit ‘Send’!
Log into your exchange and check that the coins have been deposited.
If that looks good, look for a ‘Trade’ or ‘Sell’ tab.
Here, you can select the coin you want to sell (again, we want to choose Bitcoin).
Next, you can select the amount you want to sell and you’ll want to select ‘100%’.
Now it’s just a matter of hitting the ‘Sell’ or ‘Confirm’ button and you are all done!
Your account will be credited with the corresponding amount of your local currency you sold the bitcoin for and you can withdraw it using any of the methods supported by the exchange.
And that’s really all there is to it!
Pretty simple, huh?
You can use this website to find all the best exchanges for you to buy and sell on and use the steps above to guide you through the process on each of them.
If you have any questions, please feel free to reach out, and we wish you the best of luck on your bitcoin buying journey here on our site.