What can I buy using my Bitcoin?
When Bitcoin first launched in 2008, few truly imagined the heights that the coin would achieve. Nowadays, Bitcoin is the gold standard for cryptocurrency. While the price can fluctuate wildly, the currency still has the potential for monumental gains.
Of course, you have to own Bitcoin to take advantage of those gains. If you’re ready to hop on board the Bitcoin train, you’ve come to the right place. We will teach you all you need to know about how to buy Bitcoin in this Bitcoin buying guide, as well as storing options for both long and short-term holders.
How do you Buy Bitcoin?
The process of buying Bitcoin has evolved over the years. In the early years of the coin, the only way to acquire it was to buy it directly from other Bitcoin users or to mine for it. As the popularity of Bitcoin grew, other options for purchasing the coin began to emerge.
Today, there are multiple legitimate ways to purchase Bitcoin without resorting to costly mining. We will go over how to buy Bitcoin, along with offering some alternative methods for acquiring it.
Buying Bitcoin: Step By Step
Many people avoid getting into Bitcoin because they think the process will be complicated. The reality is that it is easier than ever to buy and sell Bitcoin. Today, we will give you a simple four-step process to buying Bitcoin. We will walk you through everything from setting up your Bitcoin wallet to making your first purchase.
Step 1: Picking a Bitcoin Wallet
A Bitcoin wallet is similar to a physical wallet but with extra features. A wallet is used to store your digital currency, but it can also be used to send and receive Bitcoin.
There are multiple versions of Bitcoin wallets available, and in this section, we will break down the most common wallets available.
Mobile wallets are easily the most popular form of Bitcoin wallet as they can easily be used on almost any mobile device. These are for people who are trading Bitcoin or using Bitcoin for purchases regularly.
BRD is a great wallet for new crypto users. It allows you to buy, sell, and hold Bitcoin, Ethereum, Bitcoin Cash, and a handful of top cryptos. This blockchain wallet doesn’t require accounts or passwords with all transactions handled directly through blockchain. Coinomi is another popular mobile wallet that supports Bitcoin and over 1,700 other blockchain assets.
Desktop wallets are Bitcoin wallets that are stored on your desktop or laptop. Desktop wallets give you more control over your wallet, including the ability to backup your wallet to an external drive. Electrum is one of the most popular desktop wallets and offers basic send and receive capabilities for major cryptos like Bitcoin and Litecoin. Exodus offers a wallet for both desktop and mobile that supports over 130 cryptocurrencies.
The most secure wallet out there is a hardware wallet. They are small devices that you use to store your Bitcoin and conduct any transactions. Except for when you connect to the web to make transactions, your Bitcoin stays offline. Hardware wallets secure your private keys and are consider unhackable. The major downside to hardware wallets is that they are costly and can be difficult to setup. Nano Ledger and Trezor are two of the elite hardware wallet providers.
Another option for storing your Bitcoin is using a wallet provided by the exchange. If you want the ultimate in simplicity, exchange wallets are the best option. Once you buy crypto, the exchange automatically creates a wallet and stores your assets in them. You also have options for sending and receiving crypto from those wallets.
Step 2: Setting Up Your Wallet
Setting up a Bitcoin wallet is not very difficult. The majority of the process is done automatically. There are two things you need to pay careful attention to. The first is your wallet’s seed. Most wallets will generate a 12-word passphrase that you will need to keep. Write this down and keep it secure. This will help you recover your wallet should you forget your password or if you experience computer failure.
Next, you will need to create a secure password for your wallet. Don’t use a password that’s used anywhere else. Just as you wouldn’t want someone to know your ATM pin, you don’t want someone to know the password to your wallet. After your verified your seed and set up your password, the rest of your wallet’s setup should complete automatically.
After setup, you’re ready to use your wallet to send and receive Bitcoin. To receive Bitcoin to your wallet, go to the Receive section. This will generate codes you can use to transfer Bitcoin to your wallet. When you’re ready to send money, you’ll go to the Send section and use the Bitcoin address of your online casino or wherever you want to send Bitcoin.
Step 3: Picking a Bitcoin Exchange
Bitcoin exchanges work similarly to stock exchange platforms. The exchange sets a price for Bitcoin or other cryptocurrencies, and you can place an order using your credit or debit card to fund your account. Some exchanges even accept direct bank transfers. Like stock exchanges, you can place a market, limit, or stop-loss orders.
Once you have purchased your Bitcoin, you can then opt to either keep your crypto on the exchange or send it to your Bitcoin wallet. It is generally a good idea to send your Bitcoin directly to your wallet. This way, you are not subject to any delays should the exchange experience technical glitches or get hacked.
There are numerous exchanges out there to choose from. Here are some of the best options:
Coinbase – Now a publicly traded company, Coinbase offers you the ability to buy crypto using a credit card, bank transfer, wire transfer or cryptocurrency. This platform is great for new users. They even offer free Bitcoin for those that set up recurring purchases.
Binance – One of the more popular exchanges in the world, Binance has more advanced tools for the average crypto trader. If you’re a US crypto trader, you will have to use the US version of the website, which is not as robust as the main platform. This is another site that will give a Bitcoin bonus for regular purchases.
eToro – Another great platform for beginners. Focuses primarily on the top cryptocurrencies. The site focuses on social networking and allows you to copy the trading habits of other users. US traders will use an alternative site.
Kraken – Exchange that allows you to trade 40 different cryptos and crypto futures.
Gemini – Crypto exchange platform that is the leader in security. Also offers a crypto savings account that offers 3.05% on Bitcoin holdings and 7.4% on other cryptos.
Ndax – Canadian crypto exchanges focusing on the top cryptos. Similar to Coinbase in its early days.
Bitbuy – Another Canadian platform but is limited to seven cryptos, including Bitcoin. Has simple and Pro trading tools to accommodate buyers of all skill levels.
Also, most cryptocurrency exchanges require that you complete client verification procedures. This is due to governments beginning to crack down on crypto transactions. Some exchanges are beginning to block certain countries, such as the United States. Check with the exchange to ensure that transactions from your country are permitted.
Other Ways to Buy Bitcoin
In the next section of our Bitcoin buying guide, we will look at alternatives to buying Bitcoin at online exchanges. Let’s take a look at how to buy Bitcoin at some of the most popular alternatives.
One of the most popular alternatives to online exchanges is Bitcoin ATM machines. These machines are located in convenience stores and other locations and work similarly to bank ATMs. You deposit money into the machine, and it is exchanged into Bitcoin. Your crypto can either be sent to your Bitcoin wallet or printed out as a QR code.
Several companies, including Localcoin, GetCoins, ByteFederal, and NetCoins offer Bitcoin ATMs. The main downside to using a Bitcoin ATM is that you generally will pay a higher price for your crypto than at an online exchange. To find a Bitcoin ATM near you, visit the ATM network’s website.
Another alternative for fast Bitcoin buying is to buy directly from other Bitcoin owners. You can see how much they want for each coin and their general terms of sale. When you ready to buy, you can contact the owner directly to make the sale.
There are numerous options for P2P transfers. Here are a few of the top options out there:
Paxful – Easily the largest P2P Bitcoin exchange in the world with over 6 million users. They offer over 400 payment options, including Paypal, bank wire, Venmo, Zelle, gift cards, and much more. This is a great option for those in North America, Africa, or Asia.
LocalBitcoins – The oldest P2P platform primarily serving the Americas and Europe. They offer dozens of payment options including bank wire, credit cards, Venmo, and more.
LocalCryptos – Another service that focuses on Ethereum. You can also trade Bitcoin, Litecoin, and Dash. They also offer Blockchain-powered escrow services for added security.
HodlHodl – An anonymous P2P platform that also offers escrow of funds. You can use any payment method on this platform.
Casino Bitcoin Buying
One option many the average Bitcoin buying guide overlooks is buying Bitcoin through a Bitcoin casino. Many online casinos will allow you to buy Bitcoin gambling credits to use at the website. You’ll use your credit card or bank account to buy Bitcoin and the Bitcoin deposit is made automatically to the casino. Note that some casinos don’t advertise this option. You may need to contact customer support for the casino.
Step 4: How to Buy Bitcoin on an Exchange
Once you have selected an exchange and registered for an account, it is time to buy some Bitcoin. First, you need to add funds to your exchange account. Exchanges will allow your to fund your account using a variety of sources. Exchanges using Moonpay and Simplex as payment processors will allow credit card purchases at exchanges. Sites that allow Apple Pay are likely using Wyre as a payment processor. Check your exchange for a full list of funding options.
After you’ve funded your account, you can now purchase Bitcoin. For the fastest purchases, you can select a Market order which will buy Bitcoin at a price established when the order executes. If you want to buy Bitcoin at a specific price, then you will need to run a Limit order.
Once you have selected your order type and how much you wish to purchase, execute the order. Once the order is completed, your Bitcoin will be transferred directly to your account. You can then transfer your Bitcoin to your Bitcoin wallet.