How to Buy Bitcoin: A Step-by-Step Guide for Beginners

How to Buy Bitcoin: A Step-by-Step Guide for Beginners

In this article we share a step by step process on how to buy Bitcoin in 2024

How to Buy Bitcoin: It may appear difficult to invest in bitcoin (BTCUSD), but it's not. All you need is a secure means to keep your purchases and an account with a cryptocurrency exchange or service.A secure internet connection, a payment method, a personal digital wallet separate from the exchange account, identity papers if you're utilizing a Know Your Client (KYC) platform, and a cryptocurrency exchange account are all requirements for NBT investors.  Debit cards, credit cards, and bank accounts are all accepted payment options for bitcoin. Peer-to-peer (P2P) exchanges and specialist ATMs are additional places to obtain bitcoin.

Step 1: Select a Cryptocurrency Trading Platform or Service

Because they have more cryptocurrencies for trade and a wider range of features, exchanges are a practical choice. Additionally, exchanges let consumers move bitcoin to an online wallet for storage and let investors purchase, sell, and store cryptocurrency.

Exchanges for cryptocurrencies come in a variety of forms. Some are decentralized, don't need users to provide personal information, and let users stay anonymous. Popular U.S. exchanges aren't decentralized and abide by regulations requiring users to provide identity documents. These exchanges, which provide bitcoin and an increasing number of other cryptocurrencies, are Coinbase, Kraken, Gemini, and Binance.

Step 2: Link a Payment Option to Your Exchange

Personal identification may be requested, depending on the trade. This might entail providing a photocopy of your driver's license or Social Security card along with details about your employment and income source. It's pretty much the same procedure as opening a regular brokerage account.

You may link your bank account to a debit or credit card at most exchanges, or you can link it directly. While it is possible to buy cryptocurrency using a credit card, the volatility of cryptocurrency prices may increase the total cost of buying a token when paired with the interest charges on a credit card. 

Step 3: Make a Purchase

With time, cryptocurrency exchanges have become more like their stockbrokerage equivalents in terms of functionality. Cryptocurrency exchanges provide several order types and investment options. Market and limit orders are available on almost all cryptocurrency exchanges, and some exchanges also provide stop-loss orders.

With market, limit, stop-loss, stop-limit, take-profit, and take-profit limit orders, Kraken provides the widest variety of order types. Additionally, exchanges provide methods for setting up regular investments, enabling users to dollar-cost average into the assets of their choosing. For instance, consumers may schedule recurring purchases on Coinbase for each day, week, or month.

Step 4: Secure Storage

Cryptocurrency wallets and bitcoins are places to keep digital assets more safely. Investors maintain control over the private key to the cash when they store cryptocurrency in a personal wallet rather than on an exchange. While suggested, an exchange wallet is not advised for significant or long-term bitcoin holdings.

Other Options for Purchasing Bitcoin

Bitcoin ATMs

Bitcoin ATMs function similarly to physical bitcoin exchanges. People can buy bitcoin with cash by inserting it into a machine; the cryptocurrency is then transferred to the consumers' online wallets. Bitcoin ATMs are offered at Walmart Inc., a massive retailer, and have grown in popularity in recent years.

Purchasing bitcoin via an ATM entails two fees: the purchase price and the conversion fee for turning fiat money into bitcoin. When compared to alternative solutions, both costs are somewhat high. The average purchase cost at bitcoin ATMs around the globe is 5.4% for sales at ATMs and 8.4% of the purchase amount.

P2P Trades

A more direct link between users is offered by certain P2P exchange systems. One example of such an exchange is LocalBitcoins. Users may submit requests to purchase or sell bitcoin, along with details about pricing and payment options, after registering an account.

P2P exchanges provide consumers the opportunity to compare prices and get the best offer, even if they don't provide the same level of anonymity as decentralized exchanges. In order to provide consumers a method to assess possible trading partners before engaging in a transaction, many of these exchanges also have rating systems.

Disclaimer: Analytics Insight does not provide financial advice or guidance. Also note that the cryptocurrencies mentioned/listed on the website could potentially be scams, i.e. designed to induce you to invest financial resources that may be lost forever and not be recoverable once investments are made. You are responsible for conducting your own research (DYOR) before making any investments. Read more here.

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