Previously, buying bitcoin was not straightforward and carried counterparty risk through peer-to-peer trading. Today buying bitcoin and other cryptocurrencies have never been easier and safer for new crypto users. The crypto market is maturing and offering multiple efficient and user-friendly ramps to access the crypto market. In this article, we will explore where you can reliably and easily buy bitcoin.
Crypto centralized exchanges
Exchanges give you the freedom and flexibility to choose from hundreds of cryptocurrencies, not just bitcoin. They are the most reliable, simple, and convenient way to access the crypto market for beginners. However, Choose a crypto exchange wisely. After all, not all crypto exchanges are secure and reliable. The best crypto exchanges are the most liquid and reputable out there. Below is the top 5 crypto exchanges by market capitalization as of October 2021 :
Kucoin is user-friendly, lists a wider variety of cryptocurrencies, has a relatively lower trading fee, and has high liquidity. Liquidity is an important deciding factor. When the exchange is illiquid, it becomes hard to find buyers for your crypto. However, most people opt-in for Binance outside of the US since Coinbase disallows many nationalities to join its platform. So before you select an exchange, you first check whether it can legally register users from your country of origin. FTX is more for advanced traders and institutional investors, and Gate.io is for retail investors with the most trading pairs listed.
It is fairly easy to trade (buy and sell) on centralized crypto exchanges. By watching a couple of videos online, you will learn how to navigate the exchange platform. If you are a beginner, stick to trading basics and never try out leverage and derivatives, such as options and futures. These are advanced trading strategies and can be very risky.
The process to register or create an account on a crypto exchange is simple. Visit the page of your favorite crypto exchange, register using your email or phone number, and follow the step to complete the process. Prepare to verify your identity after you log in. Without identity verification, you won’t be able to buy and sell. Some exchanges allow you to deposit and trade small amounts without identity verifications, and a limited number of exchanges do not require you to go through the process altogether.
When you use an exchange, you don’t need to worry about choosing a wallet and managing its private keys. The crypto exchange provides you with a wallet to store your cryptocurrencies. For example, if you want to deposit bitcoin for an external source, you need to select bitcoin from your wallet and choose deposit. Then your wallet address will appear, and you will need to share that address with the party that wants to send you bitcoin. You must choose the correct network before you send and receive any cryptocurrency. The network must match on both the receiver and sender end, otherwise, the transaction will get lost.
The downside of using a centralized exchange is that it has control over your funds, and it is valuable to hacks. Reputable crypto exchanges have a high level of security. They would probably secure your account better than you would on your own, especially if you are a beginner. This is just a counterparty risk that you should keep in mind. Trading cryptocurrencies is never 100% safe. So take strict security measures. For example, You should never use public wifi to trade and never visit a suspicious site from the same device you use to access your wallet or trading platform. It is a good idea to trade on multiple exchanges to spread your risk and access more trading pairs.
To be safe, you can move your crypto from your exchange wallet to a so-called cold wallet. A cold wallet is a hardware similar to a USB stick where private keys are kept on the device away from an online connection. You move your funds in and out of exchange when the need arises. If you want to sell your bitcoin, you need to transfer the bitcoin from your cold wallet to your hot wallet on the exchange. You can even download a non-custodial wallet on your phone or desktop and transfer the funds there, but this is the least secure method, especially on a desktop. So it is better, in this case, to leave the funds on the exchange. For more info, read types of crypto wallets.
Now that you have registered and verified your identity, You can simply buy bitcoin from the exchange via a debit or credit card, or bank transfer. The available options depend on your country of origin and the exchange you choose.
Crypto wallets allow you to store your cryptocurrencies if you are not keen to keep them on an exchange. Not only that, but also you can buy bitcoin by using your debit or credit card and exchange your bitcoin for other cryptocurrencies, including USDT, a stable coin pegged to the dollar. Some wallets are safer than others, knowing that mobile wallets are far secure than desktops. ZamWallet, for example, uses advanced protection methods, including a password, pin, and fingerprint. It allows you to store, manage, exchange, buy and sell digital assets at your convenience and access ready-made investment portfolios built by trading experts. Zam mobile wallet is available in the app store for both Andriod and ISO devices.
Bitcoin ATMs are stands or kiosks which you can use to buy bitcoin. First, you must have a wallet to deposit your coins. Simply, choose a payment method, cash deposit, debit, or credit card, and then scan your bitcoin wallet address using the QR code. You can use the ATM to deposit bitcoin to a wallet on an exchange you use, or you can deposit the bitcoin your buy in a non-custodial wallet that you download from the app store. You need to go through an identification process if you purchase a large amount of bitcoin from an ATM.
For more details on how to use bitcoin ATM, watch the following video: https://www.youtube.com/watch?v=xajKjxxRL04
You can visit the following site to find out where Bitcoin ATMs are located in your areas: https://coinatmradar.com/countries/
Paypal is a digital payment company that acts as a third party between buyers and sellers to facilitate their transactions. Since 2020, Paypal has paved the way for its users to buy bitcoin. You can easily and securely buy bitcoin and other selective coins using your credit or debit card and manage your transactions in one place. You can also use your cryptocurrency to buy products from an extensive list of online stores worldwide.
Investment funds and trusts
You can buy a share in a bitcoin trust or mutual fund through authorized brokers. Several investment firms have started developing crypto funds, the largest of which is grayscale. Grayscale is the world’s largest digital currency asset manager, where you can buy shares in a bitcoin trust or a diversified portfolio of cryptocurrencies.
The fund manages your crypto assets on your behalf for an annual fee. Probably not a bad idea you want exposure and don’t have the time to or skills to manage your portfolio. If this idea interests you, you need to conduct further research to learn more about the fees and differences between open-ended and closed-ended funds and other existing firms in your area.
Buy bitcoin with cash
If you know a friend or relative who owns bitcoin that he wants to sell, then you can buy it from him directly as long as you have a crypto wallet, where he can transfer it to you. Some people look online for people willing to sell bitcoin or USDT in their area through Facebook groups instead of using the bank to transfer the funds.