You must have heard about the most popular cryptocurrency – Bitcoin and if you want to buy one , this guide will help you to make your first bitcoin purchase.
In this post, you will hear words like BitCoin Wallet, BitCoin Exchange, BitCoin Broker etc and we will explain them in simple terms.
How to get bitcoins:
There are two ways to get bitcoin – 1) “mine” / generate bitcoins 2) buy bitcoins
– Mine bitcoins – This involves buying an expensive supercomputer (plus electricity bills) to process the cryptographic codes. But this is not realistic for most people. So the alternative is to buy the bitcoins.
– Buy Bitcoins- You can buy bitcoins. Previously buying bitcoins were quite a complex tasks with foreign websites, long currency transfer etc, but now there are user friendly sites through which you can buy bitcoins
Step 1: Get a BitCoin Wallet (It’s free)
You need a wallet to store your bitcoins – that’s called “Bitcoin Wallet”.
There are many bitcoin wallets available in the market, but you want to go with some reputed wallet as security is the main concern. You can get a bitcoin wallet just by giving some details & email.
Blockchain.info is one of the biggest and popular bitcoin wallet. It is backed by venture capitalists. It has 14million+ wallets and has done 100million+ transactions. Coinbase.com is another big provider.
Once you signup, your personal bitcoin wallet address will be generated. It is a series of random numbers and letters. This is the address that you need to get bitcoins in your wallet.
Step 2: Buy Bitcoins through exchange or brokers or other people
Where can I buy BitCoins: There are various options through which you can buy bitcoins:
- Other people (peer-to-peer) / marketplace
- BitCoin ATM
BitCoin Exchanges: If you intend to trade in bitcoins regularly in large quantities, you can consider opening an account with a bitcoin exchange. Opening an account will most likely require lot of paperwork. Some of the major exchanges are: Bitstamp, Coinfloor, CoinCorner, Coinbase, Kraken, Safello. One of the main issues with UK exchanges are that the UK banks are not very supportive and these exchanges typically have bank accounts in Europe. So, if you need to trade, you need to transfer money in Europe bank accounts that take time and also transfer charges.
So, if you are looking to buy small quantity, it is better to buy it through a bitcoin broker or through marketplaces.
Bitcoin marketplaces: LocalBitCoins – where you can buy from sellers within your area.
You can compare prices across various marketplaces through sites like BittyBot.co
BitCoin ATM: You there are Bitcoin ATMs through which you can buy bitcoins. Just deposit cash, enter your bitcoin wallet address and done. You can check your nearst bitcoin ATM through Google search orc check Coin ATM Radar. The siute shows the location of 1400 bitcoin ATM across 57 countries. In UK alone, there are 71 ATM (with 51 in London).
Documents needed: Most of the brokers, exchanges or traders will ask your identification documents. This is important to avoid fraudulent transactions etc. However, if you are buying very small quantity, they might not ask it.
How do I need to make payments to buy Bitcoins: You can buy bitcoins by making payment via bank transfer, debit card, credit card, paypal, cash etc. But the most common is bank transfer & debit card. Depending on the payment method, there will be different charges.