How to Buy Bitcoin: The Ultimate Guide

How to Buy Bitcoin: The Ultimate Guide

Now there is no sign that the Bitcoin industry is going to slow down or decline. Given the trend towards increasing in bitcoin value, the average person still doesn't understand how to buy and sell this currency. Even if you don’t want to rely on this crypto trend, investing in Bitcoin can be a good strategy to diversify your savings and potentially to raise more capital.

Where to Buy Bitcoin

If you don’t know where to start buying bitcoin - you are at the right place. The vast number of bitcoin exchanges makes it challenging to pick the best options. In 2014 there were only six largest trading services, today we have more than two hundred. That’s why there is no surprise that people are becoming confused when it comes to buying bitcoins.

Our top trading bots

Below is a table that summarizes all the largest exchanges to buy and sell bitcoin. The sites are ranked according to such parameters as a fee, ease-of-use, available payment methods, and reputation. The last column, ‘reputation,' is based on user reviews found on different forums. The sites also differ by ways to deposit money. Some of them have several methods while others have only one.

Choose the Wallet Type

We believe that this step is one of the most important when it comes to acquiring Bitcoin. Finding a safe storage can be a difficult task considering the number of parameters to deal with. In fact, the most convenient web wallets are commonly the most insecure. Luckily there are a lot of other safe options to store your bitcoins.

In the table below you can choose the best alternative regarding safety, convenience, and cost. As a rule, the safest wallets are usually those where the private keys are kept hidden from the outside world.

Sign Up for a Bitcoin Wallet

Before acquiring Bitcoin, you have to download a Bitcoin wallet or install it on your smartphone. Then you have to fill out an online form with your details.

Before buying Bitcoin you have to submit a series of identification documents to the trading website. Depending on the requirements, such documents may include copies of your passport, utility bills, or selfies. Several years ago, when the industry just started rising, none of the sites asked for documents. Today, in 2017 almost every bitcoin exchange is required to do full KYC procedure to get protected from cyber attacks and money laundering.

Having said that, users should be careful when looking for trading sites without obligatory identification process.

Use Money to Buy Bitcoin

As soon as you sign up and have a wallet, you can use a traditional credit card or a bank transfer to buy your first bitcoin. Some trading companies like Coinbase have an option to connect your bank account to your Coinbase wallet which significantly facilitates the future transfers. The site also offers to buy bitcoins automatically at regular intervals. For example, if you want to buy $100 in bitcoin every month you can set up an automatic buy for that amount.

However, take into account that if you set up an auto-buy, you will not have control over the price of a bitcoin due to the market fluctuations. Another issue is that when you buy from trading firms rather than from Bitcoin exchanges, you can face delays when executing orders. Thus, for traders, it is more reasonable to buy directly on bitcoin exchange such as BitStamp. There you can trade with other users and avoid mediators. There is a higher liquidity and absolutely no problems when it comes to finding another person for a trade. The fee starts at 0,5% and goes down to 0.2% depending on the sum you have traded in the previous month.

Where is Bitcoin Stored?

Technically bitcoins are not stored in a wallet. They are not kept anywhere. Bitcoin balances are maintained using private and public keys which are the numbers linked through an encryption algorithm. The public key is like a bank account and can be compared with ATM PIN. It is aimed to be kept in secret and is used to verify bitcoin transactions.

Hot vs. Cold Wallets

You may have heard of hot and cold wallets. The easiest way to describe the difference between a cold and hot wallet is the following: unlike the cold wallets, hot ones are connected to the Internet. Most people who use cryptocurrency possess both cold and hot wallets as they are designed for different purposes.

Today almost every bitcoin exchange is required to do full KYC procedure to get protected from cyber attacks and money laundering.

Hot wallets resemble checking accounts while cold wallets are more like savings accounts. When users want to have some assets to spend in the nearest future, they usually keep a certain sum of money in their hot wallets for buying things. At the same time, they can keep most of their digital assets in their cold wallets.

Hot wallets are designed to do transactions on the go. For example, smartphone, web and desktop wallets can be called “hot” wallets. On the other hand, cold wallets are not connected to the Internet, and all private keys are kept offline. That’s why people use the terms “offline” and “cold” interchangeably. Without an Internet connection, cold wallets are more secured from cyber attacks and are less vulnerable to data leakages.


Having that said, you can learn by yourself after testing several different places. Thus you can decide the most suitable service. As soon as you have tried all the options, you can make the right decision and choose your favorite site to purchase Bitcoin.

Essential 2021 Crypto Trading Bots For You To Operate With
Automated Bitcoin trading is getting consciously popular among crypto investors and independent traders. Although, are there any criteria to identify a...
The In-Depth Explanation Of Crypto Wallet Keys And Their Multiple Details
Before an individual can commence any type of crypto trading or transactions, such as transferring Bitcoin to purchase items, the buyer can send money through...
A Step-By-Step Guide For Technical & Fundamental Analyses
Why Is It Important To Analyze The Market And Its Trends? Since the concept of cryptocurrency and trading is quite new, it has become crucial to analyze...
What is Blockchain Technology and How Does it Work?
That’s why imagine blockchain as a technology that keeps track of every digital transaction that happens online, whether it is an exchange of goods and...
How Do I Use Ethereum?
The very first question about dealing with Ethereum for newbies is "How do I buy ETH?" or " How to use Ethereum for trading or investing?" How to...
How and Where Can I Buy Bitcoin in the UK?
Many people interested in becoming a part of the cryptocurrency market often ask questions such as "Where to obtain cryptocurrency in Europe?" or "How...
How Exactly Do Bitcoin Transactions Work?
Bitcoin transactions are digitally signed for security and are sent to bitcoin wallets. For this to happen, your bitcoin wallet and a bitcoin network should...
How Much is Bitcoin Worth? Bitcoin Price Charts Explained
Once you obtain a certain amount of Bitcoin, it is time to begin your digital currency career, which includes one inevitable daily routine. It is checking...
The Difference Between Public, Private, and Permissioned Blockchain
You have presumably been there: a job interview, with a panel of interviews sitting opposite to you thoroughly scrutinizing your resume. What’s more, you...
How to Store Bitcoins and Other Cryptocurrencies?
Cryptocurrency may be the safest instrument for transacting values between anonymous users. However, storing and trading cryptocurrencies can be quite...
How Legal is Bitcoin and Other Cryptocurrency?
Bitcoin as the main asset of the independent, decentralized system of trade was always under the eye of the institution's such tax authorities, law enforcement...
What are the Use Cases of Blockchain Technology?
While Bitcoin and other cryptocurrencies (Ethereum, Ripple, Litecoin, etc.) determined and secured their place on the modern market after dominating the...
Blockchain's Issues and Limitations
The most innovative and beneficial technology has shown many remarkable uses so far. Blockchain has unique advantages to other technologies, but it also...
Creating a Bitcoin Paper Wallet
Cryptocurrency wallets usually consist of two keys. A public key represents user's wallet address on which other users send Bitcoins. A private key is...
Satoshi Nakamoto, the Founder of Bitcoin
Satoshi Nakamoto is the name that stands behind the unknown person or group of people who created Bitcoin and its original implementation. As the part...