Purchasing Bitcoin (BTC) initially might look complicated for new digital asset investors. This is true even if you've invested before in the stock market through traditional investment accounts.
The lingo for the digital currency market is quite different. However, once you learn the standard terms used within this market, it becomes clearer. And after you make your first digital asset transaction, it will be more straightforward next time.
Those who take the first step to enter this Bitcoin investing community, often find themselves branching out to learn about fiat currencies, gold, silver, Central Banking, interest rates, deficits, inflation, and other global macro investing topics.
Before you go any further, the first step to start investing is to create an account on a cryptocurrency exchange. Based on your needs, If you have chosen the right trading platform, you have won half the battle.
In addition, some people struggle with the right storage option for their digital currency investment, which might be the biggest mistake. I recommend owning a personal digital wallet outside the control of your exchange.
But, as a brand new investor in this space, storing your crypto on a personal hardware wallet might be challenging and make you uneasy. It would help if you relied on an exchange with high-end security mechanisms to solve this issue that uses cold storage \”offline\” to keep your BTC more secure.
The first-time buyer must also need to verify their identity through a process called \”Know Your Customer\” (KYC). Selecting a funding option is another critical requirement for buying Bitcoin. And it's recommended to use only valid and regulated payment methods. These include debit/credit cards, bank transfers, PayPal, etc. This will help ensure the safety of your funds.
If you don't know how or where to buy online, don't worry. I have compiled this comprehensive guide to help new crypto investors make their first Bitcoin purchase. So, with no further delay, let's dive into the article.
Table of Contents
⦁ What to Consider When Buying Bitcoin?
1. Buying an Entire Bitcoin isn't the Only Option
2. Crypto Exchanges Charge a Fee for Buying a Bitcoin
3. Plan to Protect your Password
4. Choose the Most Trusted Way to Store your Bitcoin
⦁ Step-By-Step Guide to Buying Bitcoin
1. Find a Trusted Crypto Exchange
2. Choose a Payment Option
3. Place your First Order
4. Store your Bitcoin Safely
⦁ Buying Bitcoin with Coinbase
⦁ Buying Bitcoin with eToro
⦁ Buying Bitcoin with Binance.US
⦁ Buying Bitcoin with Kraken
What to Consider When Buying Bitcoin?
Before discussing the procedure of buying Bitcoin, let's discuss the critical aspects of such a purchase. Following are some of the essential things to consider when you plan to buy Bitcoin.
⦁ Buying an Entire Bitcoin isn't the Only Option
Most new investors don't know that there is no need to buy a complete Bitcoin. It would be more appropriate to buy only a fraction. This simply means that you can invest only a limited amount of funds when investing in Bitcoin.
⦁ Crypto Exchanges Charges
Apart from the current price of Bitcoin, you also need to pay a particular amount of fee to the cryptocurrency exchange. Most cryptocurrency exchanges charge a fixed amount in this context that varies in price.
⦁ Plan to Protect your Password
To protect your stored Bitcoin against theft or hacking attacks, it is imperative to choose a strong password. Also, keep this password in a safe place, primarily offline such as a safe-deposit box.
⦁ Choose the Most Trusted Way to Store your Bitcoin
Usually, crypto exchanges also offer a digital wallet, also known as a hot wallet to store crypto assets. To add some additional level of security, you can choose an independent crypto wallet. For this purpose, \”Cold Wallet\” can be a great choice.
Step-By-Step Guide to Buying Bitcoin
⦁ Find a Trusted Crypto Exchange
Buying any type of cryptocurrency requires you to follow a few simple steps. For Bitcoin, the foremost step is to choose a well-established centralized exchange, which is an online trading platform, where you can invest in Bitcoin through your currency of choice. Most exchanges offer Bitcoin for new investors.
Although there are various types of platforms out there, you need to choose the one that offers better security. Check to see if they have independent insurance policies to protect users against theft of their crypto.
In addition, the exchange should be affordable and user-friendly. Some of the most trusted names in the crypto world include Coinbase, eToro, Binance.US, and Gemini which also offer many additional financial products.
⦁ Choose a Payment Option
Once you have selected your preferred exchange, it's time to transfer the funds. For this purpose, you need to opt for a payment method that suits you the most. Usually, exchanges offer a variety of payment options that include:
⦁ Bank transfers
⦁ Credit/Debit card
⦁ Wire transfers
⦁ Cryptocurrency wallet
You need to be extra cautious when choosing a particular payment method. Because exchanges charge a higher fee for some payment options. For instance, Coinbase charges $10 on wire transfers and 2.5% of the amount sent via PayPal. However, this platform doesn't charge any fee for funding made through bank transfers.
Buying BTC directly via a debit card (without funding the exchange) costs more. Coinbase charges up to 3.99% of the amount used for purchasing Bitcoin through a credit/debit card. Transactions made through a credit card are charged heavily on some other platforms.
⦁ Place your First Order
After funding your new account, you are all set to complete your purchase. For this purpose, tap a button with Bitcoin's symbol. Sometimes, you might have to enter the ticker symbol of Bitcoin, i.e., BTC.
The next step is to enter the amount you will spend to purchase. Upon completing the transaction, you will own a portion of Bitcoin. You have heard it right, a ‘portion of Bitcoin,' otherwise known as a Satoshi. Because you need a large amount of money to buy a single coin.
For instance, when writing this article, it was being traded for $29,758. So, if you want to buy $1,000 worth, you would only get a small fraction of it (0.034%).
⦁ Store your Bitcoin Safely
So, now you own a portion, next let's move on to safety. Most probably, your exchange might come with an integrated Bitcoin wallet. Many new crypto investors prefer to keep their investment on their own account with the exchange until they become more experienced. If the exchange doesn't offer this directly, they usually suggest a preferred partner for this purpose. Using any of these storage methods, you can keep your Bitcoins safe in most instances.
However, some people don't trust the safety level of crypto hot wallets, which are connected to the internet and prone to attacks by hackers. Hence, most popular exchanges, such as Coinbase, offer reinsurance to customers if their crypto becomes stolen from the exchange.
Cold wallets are an option for those who prefer to keep their cryptocurrency off the Internet, and more secure. Storage options like these can prevent unauthorized access but come with a high cost and technical know-how to use. Keep in mind that you have to pay a certain amount to your exchange to move your Bitcoin, and if you lose your cold wallet, then your Bitcoin cash is gone.
Buying Bitcoin with Coinbase
Step 1: Buying with Coinbase is simple. First, you need to create an account with Coinbase.
Step 2: After you register with Coinbase, the next step is to add a payment method. You can choose from various available options, including PayPal or a Credit/Debit card. You can also take advantage of the Lighting Network (LN) with Coinbase to transfer money (onboard) from your bank account to buy, instead of the slower ACH traditional method.
Step 3: You can start a trade by going to the trading section
Step 4: Now, choose Bitcoin from the cryptocurrencies available on the list.
Step 5: Enter the required amount you want to buy.
Step 6: Confirm your transaction by hitting the \”Confirm Buy\” button.
Buying Bitcoin with eToro
Step 1: You need to create an account with eToro.
Step 2: The next step is to add a payment method that you can use for the deposit and withdrawal of funds.
Step 3: After funding your account, it's time to choose Bitcoin from available crypto assets.
Step 4: Once you have selected Bitcoin for purchase, enter the amount you want to use for buying.
Step 5: Click the ‘Open Trade' button to complete your purchase.
Buying Bitcoin with Binance.US
Step 1: The first step is to create your account by visiting the Binance.US or downloading the app.
Step 2: Select the preferred payment method from the options offered after creating your account.
Step 3: Just go to the list of the crypto coins offered. Here, you can select Bitcoin from the list of assets.
Step 4: You are a few steps away from buying. In this step, you must enter the amount you want to use to buy 1 BTC or Satoshis.
Step 5: The last step is the confirmation of your order. By hitting the ‘Confirm' button, you will finish purchasing your first digital gold coin.
Buying Bitcoin with Kraken
Step 1: Create an account with Kraken.
Step 2: Add a deposit method you will use to fund your Kraken account.
Step 3: Select Bitcoin from the list of assets.
Step 4: Enter the amount you want to buy.
Step 5: Click the ‘Confirm' button to buy BTC.
How do Beginners Buy Bitcoin?
Beginners can easily buy by registering to any exchange, i.e., Coinbase or Kraken. Here, beginners can use the instant buy options. Beginners can buy Bitcoin through a spot market. However, they need to research how to use these trading interfaces.
How do I Buy Bitcoin with Cash/Debit Card/Credit Card/PayPal
Buying with cash differs slightly from any other method. Hence, I am going to discuss it separately.
Buying Bitcoin with Cash
The most convenient way to buy with Cash is to look for a Bitcoin ATM near you. Before making any transaction, you should have a crypto wallet address to provide during the process. Most Bitcoin ATMs follow a less daunting and straightforward process. So, you won't find it hard to buy with cash.
Buying Bitcoin with Debit/Credit Card or PayPal
For buying with a Debit/Credit card or PayPal, follow the steps listed below:
Step1: Register with an exchange like Coinbase, Binance.US, or eToro and open an account.
Step 2: Choose a Credit/Debit card or PayPal as a preferred method to transfer funds.
Step 3: Enter BTC in the search bar and click on \”Trade.\”
Step 4: Enter the amount and buy a fraction of Bitcoin. Click \”Open Trade\” to confirm your trade.
Can I Purchase $100 of Bitcoin?
Yes, it is possible to buy digital gold for $100. You can even invest for less than $100. Because this way, you will buy a fraction of it by paying such a small amount. However, it also depends on the type of exchange you are using.
Is it Worth Buying a Small Amount of Bitcoin?
The answer to this question depends on how small your investment is. For instance, spending $10 on your Bitcoin purchase can't be an investment worth making as you won't be able to make a fortune out of it. This might be a good option if you are new to the crypto world and want to learn the basics of crypto trading before investing more of your capital.
How to Buy Bitcoins Anonymously?
There are various ways to buy anonymously (Without ID verification):
1. Use Bitcoin ATMs for buying anonymously with cash
2. You can also use any of these platforms:
Steps to Buying Bitcoin
Here are the critical steps:
Step 1: Select a crypto exchange or broker
Step 2: Create an account and verify it
Step 3: Transfer funds
Step 4: Place an order to buy BTC
Step 5: Choose a storage method
How to Buy my First Bitcoin?
Listed below are the critical steps to buying your first digital asset:
⦁ Download and open the Bitcoin Wallet app on your smartphone
⦁ Choose Bitcoin (BTC)
⦁ Tap the ‘Buy' button
⦁ Just follow the instructions to select a preferred digital wallet
⦁ Since you are buying for the first time, it is essential to verify your identity
⦁ After completion of verification, you can proceed with the Bitcoin purchase
How to Buy Bitcoin Safely
There are aspects to consider when thinking of safely buying. First, you need to choose a reliable and trusted cryptocurrency exchange. I regard eToro as the best trading platform for purchasing. Apart from being safe, eToro doesn't charge a transaction fee, and offers a variety of other cryptocurrency investments should you choose to diversify. This platform is regulated by top-tier entities, including FCA, ASIC, CySEC, SEC, and FINRA. It will award you complete ownership of the Bitcoin that you have purchased.
Where to Purchase Bitcoin in the USA
If you are a U.S. resident, buying Bitcoin is regulated and not illegal. Simply choose among the crypto exchanges that are operating in the USA. Here is a list of top trading platforms in the U.S.
In addition, you can also use Bitcoin ATMs near you to buy with cash.
Can you Buy Partial Bitcoin?
Yes, it is possible to buy partial amounts. Most crypto traders/investors can't buy even a single coin. For $29,758, this crypto coin is too expensive to buy. So, people prefer to buy small fractions for investment, and dollar cost average (DCA) in overtime.
Risk Disclosure: Any investments come with an inherent risk, where you could end up making less money than what you put in. Before investing your hard-earned cash, be sure to speak with licensed professional financial advisor first. Always remember that past performance is not an indication of future returns.
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