Where to buy Bitcoin
With the price spiking like crazy over the past few weeks to an all time high of $2,800, many new users are thinking, “Where can I buy Bitcoin”?
Now with the market correction bringing the price back down to under $2,200, there is no better time to arm yourself with the knowledge of where to buy Bitcoin.
If you have already decided not to try to accumulate Bitcoin through mining – which has become increasingly difficult as hardware prices and competition have increased, while the finite supply of minable BTC has decreased – this is your guide on where to buy Bitcoin.
There are plenty of options for buying or otherwise acquiring Bitcoin, and we’ve laid out some of the simplest below.
But first . . .
Get a wallet
If you’re going to buy some Bitcoins, you’ll need a place to store them. That’s where Bitcoin wallets come in.
Bitcoin wallets function like a cross between a bank account and the physical wallet you keep in your pocket; they both store your Bitcoins and allow you to make purchases with them. Bitcoin works via public/private key cryptography, which means each wallet has at least a public key and a private key. Think of a public key as your bank account number, you can share this with anyone to get paid into, but no one can use it to spend. Think of your private key as your account PIN number, if someone else figures out this number, they can spend all of your money. So while being in control of your private key means you alone are in control of your money, it also means you have no recourse to get your money back when it is stolen. This means wallet security is of utmost importance!
As CoinDesk notes in a helpful post, there are five types of wallets available: desktop, mobile, web, paper, and hardware.
For the average user, mobile or web-based are probably the most convenient.
Mobile wallets are convenient in that they allow you to spend your Bitcoins as long as you have your phone handy. They either contain the private keys for using your Bitcoins or allow your phone to access a service that holds the private keys on your behalf. Wallets for Android include Bitcoin Wallet, Breadwallet, Mycelium, Xapo, Blockchain, and Airbitz, among others; iOS offerings are somewhat more limited but include Blockchain, Breadwallet, Mycelium, and Airbitz as well as a few other offerings.
Web-based wallets offer the convenience of being accessible anywhere you can get online, and some also link to your mobile and/or desktop wallets. Some of the more popular online wallets include Coinbase, Blockchain, and Xapo. If you choose to use Coinbase or Xapo, one thing to keep in mind is that you are not in charge of your private keys, meaning that the companies could potentially lose your money or keep you from your funds. However, they can help with password recovery.
A word of caution – just like with any form of currency, there are steps you should take to make sure your Bitcoins are secure, no matter the type of wallet you use. The CoinDesk link above provides some good tips for securing your wallet, as does a helpful post from Bitcoin.org.
As another safety tip, it’s advisable not to put too many Bitcoins into places that are easy to access, as you could get hacked and lose everything. Mobile and web-based wallets are great for their convenience, but they are not the best in terms of security.
In contrast to mobile and web-based wallets, hardware wallets provide excellent security. These small devices hold your private keys electronically and, if you have a substantial amount of Bitcoins, provide a safe alternative to storing your BTC with third-party services. Ledger, Trezor, and Keepkey are the top hardware wallets.
Paper wallets provide another secure alternative to mobile and web-based wallets. A paper wallet is a small piece of paper that contains, at a minimum, your private key. Like hardware wallets, these physical paper wallets are secure against hacking. The best paper wallet is Cryptosteel. Despite falling in the “paper wallet” category, it is actually made from metal, meaning that it is water resistant, fire retardant, and extremely durable.
Links to the aforementioned wallets below:
Bitcoin Wallet (Android):
So that’s a basic primer about Bitcoin wallets – now where can you actually get coins to fill your wallet with?
Get paid directly in Bitcoin
On of the most convenient ways for accumulating Bitcoin is to receive your wages in it, either as a W2 employee or a 1099 remote freelancer. For those looking for the easiest way to slowly accumulate Bitcoin over time without worrying about whether you are buying at the right price, receiving a portion of your paycheck in Bitcoin may be the right solution.
By using Bitwage’s invoicing (and payroll) service, you can be paid directly in BTC without your company needing to sign up directly. You can choose to receive any percentage of your wage in Bitcoin and it is available to workers anywhere in the world receiving wages from US, EU and UK companies.
No employer onboarding is required. We provide collections accounts in the US, EU and UK so that any funds sent into these accounts are delivered as BTC directly into the wallet of your choice. Additional benefits to receiving your wages in Bitcoin is that there are no limits to the transactions, BTC is delivered same to next day and you do not need to have a bank account involved.
Rather than investing the time and effort required to purchase Bitcoins, being paid through Bitwage puts BTC effortlessly into your wallet without forcing you to jump through any hoops.
That being said, sometimes you just want to buy Bitcoin in a one-off situation or try to bet on the price swings. In this case, your best bet is a Bitcoin exchange.
Exchanges are perhaps the best-known way to buy Bitcoins. They allow you to buy and sell Bitcoins in your local currency, and can also provide a wallet wherein to store your BTC, if you haven’t selected a different provider. (Note: it is advisable to move your BTC to your own secured wallet after purchasing them through an exchange, as exchanges are notoriously known to be targets for hackers.)
Exchanges are, in essence, institutions dedicated to the trading and speculation of Bitcoins. In terms of their actual functionality, they’re somewhat similar to standard banks – you deposit a supported currency into your account with the exchange, then use the funds in that account to buy or sell Bitcoins or other currencies.
Although buying Bitcoins through an exchange is relatively convenient, some downsides include trying to buy at the best exchange rate, finding an exchange that accepts your preferred payment method (note, also, that fees can be tacked on to various payment methods), and the complexity of the interface. Further, they are sometimes lacking in security, as many have been hacked in the past, and those without reputations may be scams. This means it’s always important to do your research before buying BTC through an exchange. Finally, if they offer leverage, without good risk management, they may not have the liquidity to pay back all users in the event of a crash that leads to an unexpected high liquidity event.
Selecting an appropriate exchange depends on your geographical location. Different exchanges provide services to users in different regions. We’ll list a few exchanges by location below.
Please note that this list is not an endorsement of the exchanges below and you should always do additional research before choosing an exchange to work with.
Central and South America:
This list may not be fully comprehensive. With that said, for countries without exchanges in this list, it may be possible to purchase BTC with a credit card, as detailed in the section below.
Buy Bitcoin with a credit card
The last option is to buy Bitcoins directly with your credit card, but there are some drawbacks to this. The fees are high and the amount you can buy is limited. A company might, for example, allow only $50 purchases initially, then raise the cap to $200 after four days and $500 after a week.
With that said, there are quite a few options for doing so.
Coinbase provides this service in the US, UK, and continental Europe. Bitstamp makes this service available to most US and European citizens, and SpectroCoin and BitPanda are also available in Europe.
Cex.io is available in the US, Europe, and some South American countries.
IndaCoin makes buying Bitcoin with a credit card possible in over 100 countries, and CoinMama, VirWox, and 24/7 Exhange provide similarly global services.
Links to these services below:
Now you are armed with the knowledge of where to buy Bitcoin!