Ahh, Bitcoin is the cryptocurrency that started it all. Even though it’s been around for over a decade, many people are still trying to wrap their heads around this wild world of digital money. If you’re one of the folks who has been sitting on the sidelines until now, don’t worry—let’s get you caught up to speed.
By the end of this guide, you’ll have all the knowledge you need on how to buy Bitcoin. We’ll cover the gamut, from picking an exchange to setting up a secure wallet to different payment methods. Let’s begin!
What is Bitcoin?
Before we get into the nitty-gritty of how to actually acquire some Bitcoin (BTC), it’s important to understand what it is and why it’s revolutionizing money and finance.
Bitcoin is a decentralized digital currency that allows for secure peer-to-peer online transactions. Unlike traditional government-backed money, Bitcoin operates on a blockchain network that is not controlled by any centralized institution.
New Bitcoins are created through a process called “mining,” where high-powered computers validate transactions on the network and are rewarded with newly minted coins. There is a finite supply capped at 21 million coins, a key difference from fiat currencies, which can be printed ad infinitum.
With its innovative technology, lack of third parties, lower fees, and global borderless nature, Bitcoin and blockchain technology are poised to disrupt payment systems and money as we know it. Many speculate it could one day replace physical cash and central bank currencies.
Why Buy Bitcoin?
Of course, before diving into an investment, it helps to understand the drivers behind it. Here are some of the top reasons people are flocking to buy Bitcoin:
• Ability to be your bank and cut out third-party institutions
• Secure, pseudonymous way to transfer value around the globe
• Inflation hedge and “digital gold” scarce assets thanks to the capped supply
• First-mover advantage of an emerging asset and technology
• Decentralized, not controlled by any government/company
• Make transactions 24/7 without approval from central authorities
Many view Bitcoin as a smart long-term investment and store of value, while others use it mainly for transactions. Getting set up to buy is the first step in whichever bucket you fall into.
How to Buy Bitcoin for Beginners
Buying this cryptocurrency nowadays is extremely beginner-friendly compared to the early Bitcoin days. You no longer have to run any special software or interact directly with the blockchain. Several reputable, regulated exchanges and brokers will set you up and allow you to buy Bitcoin with just a few clicks.
Here is a simple step-by-step guide for beginners looking to buy their first BTC:
Step 1: Choose a Crypto Exchange
The first decision to make is where you’ll buy your Bitcoin from. For first-time investors, using an easy-to-use, beginner-focused exchange like Coinbase, Cash App, or PayPal is recommended. Their interfaces are simple and geared toward new buyers. More experienced traders may prefer Binance, Kraken, or Gemini.
Coinbase – One of the earliest and most popular US exchanges, great for beginners. A wide array of funding options and availability in over 100 countries.
Cash App – A fast, easy-to-use mobile app that allows you to buy Bitcoin instantly with your bank account or debit card from anywhere.
PayPal – You can now buy BTC and other major cryptocurrencies right from your existing PayPal account with just a few taps.
Binance – The world’s leading crypto exchange with deep liquidity and more advanced trading options, such as placing orders. Not beginner-friendly.
Step 2: Set Up Your Secure Wallet
While major exchanges will store your Bitcoin for you, transferring it to a personal cryptocurrency wallet that lets you retain full control over your funds is highly recommended. There are many highly-rated options for Bitcoin wallets falling into two categories:
Software Wallets:
These wallets are apps you download for free on your mobile device or computer.
Exodus – Beginner-friendly multi-coin desktop and mobile wallet with great UI.
Electrum – Long-standing popular Bitcoin-only desktop wallet. More advanced options.
Mycelium – One of the best Bitcoin mobile wallets for Android.
Hardware Wallets:
These highly secure USB-drive-like devices completely isolate crypto from the internet for maximum security.
Ledger Nano X – Premium hardware wallet for storing multiple cryptocurrencies offline.
Trezor Model T – Another reputable, beginner-friendly hardware wallet.
Step 3: Create an Account and Buy Your First Bitcoin
Once you’ve decided on an exchange and have your wallet ready to store the Bitcoin, it’s time to make your first purchase:
1. Complete the identity verification process on your chosen exchange by providing documents proving your identity and address.
2. Connect your preferred payment method – commonly a debit card or bank account.
3. Navigate to the buy/sell menu and select how much Bitcoin you’d like to buy and with which payment method.
4. Review the fees and total purchase amount, then confirm the order.
5. Your BTC should arrive in your exchange wallet within minutes or hours, depending on the payment type.
6. Finally, you can transfer your new Bitcoin from the exchange wallet to your personal software or hardware wallet’s address to complete the process.
Congratulations! You’re now the proud owner of some Bitcoin! Of course, let’s cover some more advanced options for those who want to delve deeper into buying BTC with other alternative methods.
Other Ways to Buy Bitcoin
While using an app or exchange directly is the most convenient method for new buyers, it’s not the only way to acquire Bitcoin. Here are several other popular pathways to get BTC into your wallet:
Buy Bitcoin with PayPal
Earlier, we mentioned that PayPal lets you buy the top cryptocurrencies on its platform. This is a seamless option for anyone already using PayPal services. You can purchase by funding from your PayPal balance, bank account, or debit card or pay later with the PayPal Credit option.
Use a Bitcoin ATM
There are now over 30,000 Bitcoin ATM kiosks worldwide. At these BTMs, you simply scan a wallet QR code and insert cash to instantly purchase BTC. These BTMs in convenience stores and malls make it extremely easy to buy Bitcoin anonymously with cash.
Utilize a Peer-to-Peer Exchange
Platforms like LocalBitcoins and Paxful connect buyers and sellers who can meet up locally and trade cash for Bitcoin face-to-face or use other non-custodial payment methods like gift cards. While less convenient than an exchange, this option does provide more anonymity.
Earn Bitcoin Instead
Of course, you don’t necessarily have to “buy” Bitcoin if you’re willing to earn it through other means:
• Mining Bitcoin by contributing computing power to the network.
• Get paid in Bitcoin for your job or freelance work.
• Earn BTC through interest accounts, games, or micro-earning platforms.
• Run a Bitcoin node and be rewarded for validating transactions.
Where to Buy Bitcoin Safely Online
Suppose you plan on using an online exchange platform to purchase your BTC. In that case, it’s important to choose one that is safe, regulated, and has proper security measures to protect your funds and personal information. When researching exchanges, look for indicators like:
• Based in a regulated region with proper licensing.
• Requires identity verification and KYC for all users.
• Support for cold storage of crypto assets.
• Two-factor authentication and email confirmation.
• Robust encryption and cybersecurity.
• Available insurance for assets on the exchange.
• Positive reputation and transparency with the community.
This is not an exhaustive list, but having multiple security features and identity checks in place is mandatory for any reputable crypto exchange. Always research to avoid shady platforms and ensure your Bitcoin is purchased and stored safely.
Ready to Dive Into Bitcoin?
Whew, that was a ton of info! But as you can see, buying your first Bitcoin is quite straightforward and approachable for just about anyone in 2024. From beginner-friendly fiat onramps to earning it through other means, the opportunities to get exposure to this revolutionary digital money have never been more abundant or accessible.
You don’t need programming skills or to be fresh out of MIT anymore. All it takes is a few taps on a mobile app or a few clicks on a trusted exchange website, and BAM—you’ll have skin in the crypto game. Of course, it’s crucial to continue educating yourself, keep an open mind, and decide whether investing in Bitcoin or transactions aligns with your philosophy and risk tolerance.
