How to Buy Bitcoin (BTC) and the Best Places to Buy
Bitcoin is the most popular cryptocurrency with the highest market share. As a result you can buy Bitcoin from many different places. To clarify that includes additional options which are not available for any other cryptocurrency. Moreover there are direct ways or more indirect ways of owning Bitcoin. They are all outlined on this page.
Firstly, the easiest and most popular way to buy Bitcoin is by using an exchange like the ones below. If you get Bitcoin directly from an exchange you own the asset outright.
Best Bitcoin Exchanges
BTC, ETH, DOT, DOGE, 90+ Cryptos
- Excellent security features
- Low fees on Kraken Pro
- Established exchange
- The lowest fees can only be accessed on the Pro area. There is a small learning curve to learn how to use it
BTC, ETH, BCH, 10+ Cryptos
- Established exchange
- Simple, intuitive website
- Excellent customer support
- Fees are high
- No crypto-to-crypto transactions
BTC, ETH, BCH, 60+ Cryptos
- Easy to use app
- Cryptos, derivatives, stable coins
- 24/7 support
- Lacks in choice of coins
- 600+ cryptos to trade
- Low trading fees
- Automated trading bots
- Comprehensive service
- Was hacked in 2019
- Customer service needs improvement
100+ Cryptos on Coinbase and 250+ on Coinbase Pro
- Is insured against hackers
- Low fees on Coinbase Pro
- Supports 100+ countries
- Customer support is slow and ineffective
- Goes down when large volumes of users hop on the platform
- Supports 1000+ cryptos
- Improved their security
- Supports 14 different languages
- Have reimbursed stolen client funds
- Customer support needs improvement
- Interface issues with the site
- The site has been hacked in the past.
How to Buy Bitcoin Using an Exchange
Some people have never used an exchange before and would like some guidance on how to go about it. If this is you, we have put together the guide below to walk you through the process.
This guide does not just apply to Bitcoin, but to all other cryptocurrencies. It is quite a straight forward process and is essentially broken down into 6 simple steps. We will elaborate more on them further down.
Whoever reads the guide will get a good grasp of what they need to do to buy Bitcoin. The only thing we suggest is that you make sure you dedicate some time to sorting it out. To clarify you will not take long to buy Bitcoin. It is signing up to an exchange and waiting for the bank transfer deposits to go through which takes the longest. As such buying Bitcoin literally takes seconds.
1. Choose an Exchange
You will need to pick the exchange that you feel is best for you. The good thing of buying Bitcoin is that you have a great selection of exchanges to choose from.
All exchanges in the recommended list above are good exchanges. However if you want to go for the most secure exchange your best pick is Kraken. They are renowned in the industry for implementing the best practices when it comes to crypto security. Additionally they have good liquidity and really good customer service as well.
2. Sign Up
The exchanges will ask you to provide your personal details to create an account. You will need to provide the usual details you would normally do to sign up to any platform. In other words your email and a unique password.
Since the exchanges we promote are centralised and / or regulated exchanges you will need to provide some additional information. Each exchange is different, but most will ask you to confirm you are 18 years and over.
Exchanges do this because they are considered money services. They have to comply with Anti-Money Laundering and Know Your Customer regulations.
3. Verify Your Account
Firstly you will need to verify your email address. After that they will require you to verify your identity. So you will need to submit your government issued passport or ID card and perhaps some other documents.
You should make sure that the documents you submit have up to date information. Additionally your details are the same across all the documents you submit. Otherwise it can delay the verification process.
Some exchanges have a form of tiered verification process. In other words the more cryptocurrency you want to buy, the more documentation or information you will need to submit.
4. The Exchange Will Approve the Account
If all your documentation is in order the exchange will approve your account and let you know via email. If there are any issues the exchange will send you a notification email to let you know what to rectify. You should check your spam folder just in case the email accidentally goes into that folder.
The time it takes to verify an account may vary. It would depend on the exchange, the amount of requests at the time and the amount of documentation you submit. On the other hand basic verification may be instant or may take several hours.
5. Deposit
To make a deposit you will need to find a ‘deposit’ button. However sometimes you will need to press the ‘buy’ button if you do not find a ‘deposit’ button. The exchange will ask you to make a deposit anyway if you go to buy and do not have funds. Usually the ‘buy’ button is placed somewhere close to the menu navigation at the top.
Exchanges may have a number of payment methods which you can use to buy Bitcoin. Some have more than others. They always offer bank transfers and credit/debit cards as options.
The cheapest way to buy Bitcoin is by bank transfer. However bank transfer may take some time for banks to execute your request. The time frame would depend on which country your bank is located. It may take 3-5 working days for the money to be deposited into the exchange.
Some countries have much faster processing time for bank transfers. The first bank transfer may take some time, but additional transfers to the same exchange will be almost instant. As mentioned this would depend on which country your bank is located.
Credit cards are more instant, but they come with much higher fees. You will end up paying a minimum of 3% extra just for using a credit card.
6. Buy Bitcoin
All that is left is to buy Bitcoin. You will need to press the ‘buy’ button and select Bitcoin from the list of available cryptos. Next you will be asked how much Bitcoin you will want to buy. You usually set the BTC amount you want or the amount in currency. The exchange will convert the currency amount to the equivalent amount of Bitcoin for you.
Properly Securing Your Bitcoin
So now you are all set. You bought your Bitcoin. However we encourage people to get into the habit of practicing good security measures. Crypto especially Bitcoin sitting on an exchange is liable to be stolen.
In fact successful hacks on exchanges are quite common. Hackers take advantage of loop holes they find in the code of an exchange to get into it and steal client cryptocurrency.
As a result a lot of people into crypto end up buying hardware wallets to protect themselves. Especially if you intend to leave your Bitcoin on the exchange and not touch it for a while.
Hardware wallets are a way you can secure your crypto in what is known as cold storage. It is the best way of storing your cryptocurrency because hardware wallets are not connected to the internet.
To clarify you have to connect your hardware wallet to a computer or mobile for it to work. Additionally the devices are dumbed down so that they only support basic functions. It has enough functions to enable you to effectively manage your cryptocurrency. This makes it a less complicated device that is not easy to hack.
There are two hardware wallets on the market which we recommend: Ledger and Trezor. You will be able to find the Ledger review here and the Trezor review here. Both are great devices that have been around since the early days of crypto. Moreover they have a fantastic track record – no hacker so far has hacked either device.
Buy Bitcoin From an ATM
You can also buy Bitcoin from cryptocurrency ATM machines. These are not regular bank ATM machines, but dedicated crypto ATM machines. Which means they only allow you to buy and sell Bitcoin or other cryptos.
Meanwhile as time goes by, there are more machines being installed in different locations. You can check where your nearest to ATM machine is by checking CoinATMRadar. This is a handy site where you can find up to date information on where ATMs are located. Additionally you can search for the cryptocurrency you want to buy and it will update the map accordingly.
One of the drawbacks of using a crypto ATM is that you might have to go out of your way. The closest ATM might be some distance from your location.
Secondly, ATM machines can be more expensive to buy Bitcoin. In fact on average they charge around 8.4% in fees. However some machines can charge as much as 25%. That is quite a substantial amount.
Unfortunately crypto ATM companies are not transparent with their fees. So most of the time there is no way of knowing how much you are going to get charged. However CoinFlip ATM machines charge up to 6.99% fees which is the lowest in the industry.
Additionally CoinFlip ATMs also charge a $1 network fee. This particular fee can fluctuate according to the demand on the network.
If you are up for the journey it would be nice to buy Bitcoin using an ATM. We personally have not tried to buy any crypto using ATMs since we find them expensive. Using an exchange for any crypto is much more cost effective.
Other Ways to Buy Bitcoin
Since Bitcoin is becoming so popular there are more products popping up to buy Bitcoin in different ways. In fact bankers and financiers have been getting into Bitcoin. So they are creating financial instruments so that you can buy Bitcoin through them.
As a result you can invest in Bitcoin directly and more indirectly with mutual funds, ETFs or stocks. Personally we would not invest in any other these. We much rather buy Bitcoin using an exchange to outright own Bitcoin. However they are listed here just in case you are interested.
Bitcoin Mutual Funds
Mutual funds are a way for people to pool their money together for investments. You can get into a mutual fund through a broker.
There are Bitcoin specific mutual funds. These funds are the Bitcoin Strategy ProFund (BTCFX) and the Cboe Vest Bitcoin Strategy Managed Volatility Fund (BTCVX).
To clarify these funds are an indirect way of investing in Bitcoin. This is because they deal with Bitcoin futures. Bitcoin futures trading is trading the future price of Bitcoin.
Mutual funds are actively managed by experienced money managers who pick the investments that go into the fund. As a result mutual funds have 1-2% yearly fees of the amount you have invested which is quite hefty. Moreover even if the fund loses money you still have to pay the fee.
Buy Bitcoin ETFs
ETFs are is short for Exchange Traded Funds they are traded just like stocks. ETFs allow you to buy various commodities, sectors, indexes or other assets. At this point there are many Bitcoin ETFs. In fact there are more Bitcoin ETFs than mutual funds.
You can buy ETFs through an ETF broker. Here are some ETFs that you can consider:
- ProShares Bitcoin Strategy ETF
- Valkyrie Bitcoin Strategy ETF
- VanEck Bitcoin Strategy ETF
- Global X Blockchain & Bitcoin Strategy ETF
Invest in Companies That Are Bitcoin or Crypto Oriented
Another way to invest in Bitcoin indirectly is to buy a stock of a company that is invested in Bitcoin. There aren’t that many companies that have invested in Bitcoin so the list is not long at this stage. Here are some companies that have invested in Bitcoin;
- Microstrategy (MSTR) – A company that provides business intelligence, cloud based services and mobile software. This is the company with the largest Bitcoin holdings. They have purchased thousands of Bitcoins.
- Coinbase (COIN) – One of the largest cryptocurrency exchanges. They sell Bitcoin and many other cryptocurrencies.
- Nvidia (NVDA) – A multinational technology company. They produce graphic processing units which are used in crypto mining systems.
- Square (SQ) – A payment provider. They support both fiat and crypto. To clarify they also clients to buy, store and sell crypto.
Staggering Bitcoin Price Predictions
The cryptocurrency space is vast and a portion of cryptos will likely go the way of the dodo. If you have no clue about the crypto space it is hard to pick the right cryptocurrencies. However there are some great cryptocurrencies that have some brilliant use cases. These cryptocurrencies are likely here to stay. A lot of focus has been given to Bitcoin for this reason.
There are a lot of institutions analysing the Bitcoin price chart, seeing trends and making price predictions. These institutions are coming up with a range of prices, some agree on the value, some don’t. The one thing they have in common is that all of them are higher than the current price. You can have a look at a list with more price predictions here.
Another area of interest may be Ethereum. It is a blockchain platform built to allow other projects to be built upon it. You could also opt to have a look at privacy coins.
Privacy coins are made to safe guard your privacy. Unlike traditional blockchains no one can see your wallet, who you are transacting with and with how much. This security is what makes privacy coins so appealing. If you are interested in privacy coins then you can have a look at the best privacy coins here.
Money Managers and Institutions Piling into Bitcoin
If institutions are coming round and seeing Bitcoin’s potential then there must be something to it. Bitcoin investments are being made by large institutions. Most notable are online payment system company PayPal and business intelligence company Microstrategy.
Additionally there are large institutional investors getting into the space. For example, hedge fund Tudor Investment Corporation who manages billions of assets in their fund. There is also Global Macro Investor who has renowned Raoul Pal as a founder and chief executive.
Polls showing Bitcoin and cryptocurrency use is increasing worldwide
Considering Bitcoin and other cryptocurrencies have not been around for that long they have been getting adopted more year over year. Above all, adoption by the populations is being seen, all you need to do is have a look at recent polls. With this kind of growth the price of Bitcoin and other cryptocurrencies will increase significantly.
2020 Statista poll showing respondents that used or owned cryptocurrency:
11%
Greece
10%
Spain
32%
Nigeria
In a seperate poll by Cornerstone Advisors said adoption by American adults is at:
17%
South Africa
15%
United States
Less than 15% of Bitcoins are left to mine
There are only a maximum of 21 million bitcoins that will ever be available and over 85% of them have already been mined. This is the reason why the Bitcoin price is going up over time. If most people of the world would have the ability to use bitcoin as an everyday currency then we would need to use lower denominations of Bitcoin. This is why you can buy point something of a bitcoin (ex: BTC 0.0000002).
It looks like we are heading in this direction, so although the price looks like it’s expensive it will be even more so if there will be mass adoption which could be a likely scenario. In this case it would be to your benefit to get in as soon as you can.
