Looking for a Bitcoin Buying Guide? Wondering where to start? People have many misconceptions about bitcoin, the first widely known and accepted cryptocurrency around the world.
Many people think, for example, that it is only used by hackers and shady people. However, bitcoin is going mainstream with everyone from TigerDirect to Expedia.com to Dell and even Subway accepting bitcoin payments now.
Why so popular?
Well, bitcoin has many advantages over other currencies. For example, you can send bitcoins to someone as payment without going through the banking intermediary (and receiving additional fees). It’s also much faster than sending money via wire or bank transfer. You can send bitcoins to someone and have them receive the coins in seconds.
With all this, it is no wonder that many people are now trying to buy bitcoins for the first time. However, it is not as easy as going to your bank and withdrawing bitcoins, or going to a store and withdrawing some cash earned for bitcoins.
The system works a little differently than that. This Bitcoin Buying Guide will explain some things you need to know before you buy, so you can buy safely.
First, although the price could exceed $2,000 per coin, you don’t need to buy an entire bitcoin. Most sites will let you buy chunks of a bitcoin for as little as $20. So you can start small and go from there as you get more comfortable with the way things work.
Second, this article is for general purposes only and should not be taken as financial advice. Bitcoin can be risky and before making any purchase you should consult with your financial advisor to see if it is right for you.
So here are 3 simple steps to buy Bitcoins:
#1 Get a Bitcoin wallet
The first thing you need to do before buying your coins is to get a virtual wallet to store your coins. This wallet is a text string that people can use to send you bitcoins.
There are several types of wallets, including ones you download to your phone or computer, online wallets, and even cold storage offline wallets.
Most people prefer to have a wallet on their phone or computer. Popular wallets include Blockchain, Armory, Bitgo MyCelium and Xapo.
It’s usually as simple as downloading the wallet to your phone as an app or downloading the software to your computer from the main wallet website.
#2 Decide where to shop
There are several types of places to shop and each one is a little different. There are online sellers who will sell you bitcoins directly for cash (or bank transfer or credit card).
There are exchanges where you can buy and sell other people’s bitcoins, similar to a stock market. There are also local exchanges that connect you with sellers in your area who are looking to sell.
There are also ATMs where you go to buy with cash and have the coins sent to your wallet within minutes.
Each bitcoin seller has its advantages and disadvantages. For example, ATMs are great for privacy, but they will charge you up to 20% over the current price, which is ridiculous. (At a BTC price of $2000, that’s $400! So you pay $2400 instead of $2000).
Regardless of where you decide to buy, remember to do your research and go with a trusted seller with a good reputation and strong customer service. First-time buyers will especially have questions and may need additional support to help them with their first transaction.
Take your time and research the different places to buy before you decide. Factors to consider include coin prices, additional fees, payment method, and customer support.
#3 Buy Bitcoin and move it to your wallet
Once you’ve found a place to buy, prepare your funds (ie you can send a bank transfer or use your Visa to fund your account). Then wait for a good price. (Bitcoin prices are always fluctuating 24/7). Then place your order when you’re ready.
Once your order is filled and you have your coins, you’ll want to send them to your wallet. Simply enter your bitcoin address and have the seller send you your bitcoins. You should see them appear in your wallet within a few minutes to an hour (depending on how quickly the seller sends them).
Voila, you now own bitcoins. Now you can send coins to pay for other goods and services, or hang onto them for a rainy day.
One last thing to remember: bitcoin is still in its infancy. There are large price swings and the currency can be risky. Never buy more bitcoins than you can afford to lose.