How to Buy Bitcoins – Ultimate Guide to Buying Bitcoin
There are numerous different ways to buy Bitcoin (BTC) that are all relatively straightforward once you get the hang of them. Bitcoin can be bought with other cryptocurrencies, with cash, with PayPal, by direct bank transfer, or you can buy Bitcoin with your credit or debit card instantly. However, the task can seem daunting at first from a beginner’s perspective: exchanging established currencies for an ‘imaginary’ currency on an unknown website is not something that many people would rush into, and nor should you. This article is here to take you through each of these processes and give you a comprehensive understanding of the most reliable and user friendly way to purchase as many Bitcoins as you want.
How to buy Bitcoin with debit or credit card
By far the easiest way to buy Bitcoin for beginners is to use a debit or credit card. Most of the exchanges that accept fiat currencies will do so through card payments and bank transfers. Bank transfers are usually reserved for larger payments, so therefore a debit or credit card is usually best for your first purchase. This is the method we recommend due to the simplicity of the process and the availability of card payments on exchanges. You’ll see later that it is much simpler to use a debit or credit card to buy Bitcoin than it is to use Paypal, for example.
Sites that Accept Credit or Debit Cards
For credit and debit card purchases we are going to take you through the process on Coinbase. Coinbase is the largest Bitcoin broker worldwide and gives users a weekly limit of US$10,000. It is possible for users to buy themselves a higher weekly limit by purchasing more cryptocurrency. This site is a personal favourite of the team as it is known for its ease of accessibility and is widely regarded as one of the best places to buy Bitcoin, Ethereum (ETH), Bitcoin Cash (BCH) or Litecoin (LTC). It is one of the few exchanges that has a fully functioning mobile app, that is incredibly user friendly and means you can buy Bitcoin on the go from the app.
The first step is signing up to Coinbase (if you use our referral link you’ll receive $10 of FREE Bitcoin). Once you have signed up all you need to do is verify your email and set up your 2-factor authentication code, which is just a means of strengthening the security of your account. So if you were wondering, “is Coinbase safe?”, the answer is, yes. Coinbase is probably the most secure exchange currently in use. The site requires the 2-factor authentication code to be completed every time you log into your account to ensure additional safety. In addition to this Coinbase is one of the longest running and largest exchanges which means they have had the time and money to invest in their security.
Once that is done you will be asked to verify your identity by uploading a picture of some form of ID. All that is left after that is to add a payment method and you are officially ready to purchase some Bitcoin!
Keep in mind that the amount you put in is not exactly the amount that will go into Bitcoin, as in Coinbase there is a transaction fee for every purchase. This fee varies slightly depending on the country you live in and the price of Bitcoin at that moment. Coinbase has relatively high fees compared to other sites, but that is balanced by the ease of use, security and accessibility that makes Coinbase the place to go for new crypto investors.
How to buy Bitcoin with other Cryptocurrencies
If you’re lucky enough to already own other cryptocurrencies like Ethereum, then you can sell that in exchange for Bitcoin. To do this you’ll need to open an account on one of the following websites:
We’ll show you how to use Binance for our example as Binance is the largest and most well known exchange for altcoins. Read our full Binance review for more information. Once you have signed up – you can do so here – set up your two stage verification and you’re ready to go. Make sure you have transferred your altcoin into your Binance wallet then head over to the exchange page. As Bitcoin is one of the major currencies you can chose the Bitcoin market on the right hand side of the image below. This will give you the prices of all the altcoins in comparison to Bitcoin. Choose your currency pair and you’ll see the current price (we chose Ethereum to Bitcoin in the image below as an example) then put in how much Ethereum (or your altcoin) you want to sell. It’s important to remember that you aren’t really buying Bitcoin but are getting paid from the sale of the other coin in Bitcoin and therefore want to use the pink sell option. You’ll be able to “buy” Bitcoin instantly using this method or set a price when you’d like to buy at.
How to buy Bitcoin with Paypal
Ok, so let’s say you want to buy Bitcoin with PayPal, using a well known service that’s simple, fast and reliable. Unfortunately in reality buying Bitcoin with PayPal is a little trickier due to the credibility issue that comes with many sites. Where Bitcoin is more like cold, hard cash – if you lose it, it’s gone forever – PayPal is not. PayPal is like any other company that has a customer service department and will listen to your complaints. This has led to PayPal giving refunds to numerous people who claimed they did not receive the Bitcoin they bought.
So, for example, someone makes a transaction, gets the Bitcoin they were after and then phones up PayPal saying they never received said Bitcoin, then this person can in theory get their Bitcoin and get their money back. Ultimately to prevent this most companies just outright don’t allow purchases through PayPal.
However, it is still possible and LocalBitcoins is a great place to start. This is a fantastic website that allows you to choose between up to 60 different payment methods including multiple forms of online trades, or a local trade in which you would meet face to face. Users, known as traders, set up advertisements on the website with how many Bitcoins they want to sell and the payment method they have chosen. LocalBitcoins charges a flat 1% fee for all purchases.
Firstly you’ll need to register an account, along with this account you will get a free Bitcoin wallet. On the main page there is a search bar under the Quick Buy option in which you will enter the amount you want to buy in your chosen currency, and your payment method (PayPal in this case).
This will output sellers in your region, with a colour coded response time. Ideally you want to choose a seller with positive reviews and a fast response time. Clicking the Buy button will take you to a page with more details on the terms of the trade, read this in case there is anything not suited to you.
Next is starting the trade, simply enter into the blue box the amount you want to buy and click Send trade request only when you are ready to buy. There is a payment window in which the Bitcoins are held in escrow, and failure to pay before the payment window is over will result in automatic cancellation of your trade. Once you have made the payment you need to click the I have paid button and wait for the trader to verify your payment. The trade is now complete! The Bitcoins will be available in your newly acquired wallet.
How to buy Bitcoin with cash
Buying Bitcoins with cash is something that can seem disconcerting at first, but it is a straight to the point method that will allow you to get your hands on Bitcoins within a couple hours and without having to use a bank account. It is also usually a private method that does not have a prerequisite of personal information being disclosed, however the seller may ask for this information. Since this method has a risk of scams, we are going to talk about how a website like LocalBitcoins secures and simplifies the process.
LocalBitcoins is a site that allows online transactions as well as cash exchanges (for more information on LocalBitcoins go to the previous section – how to buy Bitcoins with Paypal). You can carry out cash exchanges in 4 different ways, in person, from machines, deposits at banks, or in the mail. This post will cover cash purchases in person and cash deposits at banks.
Cash purchases in person
When doing face-to-face (F2F) trades LocalBitcoins will put you in touch with nearby sellers when you select Cash in the Quick Buy search engine. You will be able to communicate with the seller in LocalBitcoins’ messaging service. For further information you can read about the buying process.
Remember when you meet up, to have your phone with your Bitcoin wallet rather than just the address, which would mean you wouldn’t be able to confirm receipt of your Bitcoins. We recommend that you only trade by enabling escrow, which is a trusted third party holding the seller’s Bitcoins during the handover of the currency in the transaction. With LocalBitcoins escrow is not automatically enabled so if you have to make sure to enable this. This whole process can vary greatly depending on who is selling you the Bitcoins.
There is obviously an aspect of danger in meeting up with a stranger, and safety is a priority; we recommend meeting in places that you know have security cameras and guards, like police station foyers or bank lobbies. Also take note of the seller’s rating on LocalBitcoins, try to buy from highly rated sellers only.
Cash purchases at the bank
In the Quick Buy search bar you will find Cash Deposit in the payment method section. This option will allow you to find a seller in your area that accepts cash. Once you’ve chosen the amount of Bitcoins you would like to buy and placed your order you will receive bank details from the seller, it is possible that the seller will specify a particular bank. Just like with cash purchases in person we recommend using escrow to ensure that you get your Bitcoins. You can then go to a bank and deposit your cash in the seller’s account, all that is left to do after that is upload your receipt to the escrow service to prove you made the deposit.
This process is more secure than a face-to-face meeting, however you have to operate within the bank’s opening hours and the entire operation will be more time consuming than meeting face-to-face.
There we have it. All the possible ways to buy Bitcoin. If you’re a beginner we’d highly recommend sticking with the basics and signing up to Coinbase as your first exchange. Once you get a bit more understanding and experience with how the system works, you can head over to Binance or a similar site and start trading altcoins with your newly bought Bitcoin. We hope this has answered any questions you might have, if you still have some ask in the comments below and we’ll get back to you as soon as possible.