What is the best way to safely and securely buy bitcoins?

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2019-09-06 06:33

Buying bitcoins hasn't always been easy to do and for many it still isn't. Buying bitcoins can be simple for some but securing them is an issue and many people who buy bitcoin end up losing access to them. To date

Step 1 - Get a Bitcoin Wallet

The best advice we can offer before anyone buys Bitcoin is that they must first learn how to use and secure a Bitcoin wallet. There are many different types of bitcoin wallet including online wallets from a site such as Blockchain.info or Coinbase, or by using a mobile phone app such as Electrum and Mycellium on Android or Cake Wallet for iOS. There are also a variety of offline and physical wallets. One of the main differences in all wallets deals with custody of the coins. With most online wallets the website actually holds your bitcoins and creates a ledger record for the amount of bitcoins you deposit. They maintain custody of your bitcoin and owe you a certain amount. Non-custodial wallets are ones where you create, control and own the private keys to your bitcoin

Custodial Online Wallets

Custodial wallets online can be broken down into two basic types, wallet only sites such as Blockchain.info or bitcoin exchanges like Coinbase. Blockhain.info provides you with little more than an website to hold your coins. For most online wallets you will be required to divulge some private data such as name and email to join the site. In exchange you can often do things like reset your password or enable enhanced security features like 2FA. The second option are bitcoin exchange wallets which not only hold your bitcoins but provide access to a marketplace where one can trade bitcoin for other various altcoin crypto currencies. Most bitcoin exchanges look and act similar to banks and the online banking software used by most traditional commercial bank customers. Online bitcoin wallets are more like a traditional bank account then they are other bitcoin wallets where you the user actually control the private keys to your bitcoin. To understand more what private keys are please take a look at related articles.

Non-Custodial or Private Key Wallets

A private key wallet is any wallet that the user controls and that offers control over the bitcoin private keys. Most bitcoin wallets including hardware, paper and software wallets offer the ability to create, save and restore private keys and seeds. Paper wallets have traditionally been considered the more secure with no online access available. Hardware wallets are also conspired safe and are the most popular option for investors with any significant cryptocurrency investments. Software wallets are those that can be downloaded and installed either on a desktop P.C. or smartphone. Phone wallets are also very popular and enable peer to peer transaction for in person trades of cryptocurrencies.

Step 2 - Using Cash to Buy Bitcoin

Now that you have a Bitcoin wallet, you can use standard payment methods such as cash, debit cards, ACH or wire transfer, or in some cases credit cards to buy on a Bitcoin exchange.

Peer to Peer Bitcoin Exchange

Many users prefer the anonymity of cash to secure their bitcoins embracing the peer to peer nature of bitcoin and meeting in person for a face to face exchange. These transactions are generally fast and secure and with the proper precautions considered one of the most secure and safest ways to purchase bitcoin. Buying bitcoins through online peer to peer communities like LocalBitcoins and Paxful as well as Local.Bitcoin.com for BitcoinCash transactions.

Bitcoin ATM

Users can also chose to buy bitcoins with cash at 100's of Bitcoin ATM locations spread across the United States. All customers need to do is deposit cash in the ATM and scan a QR code with a special scanner attached to the ATM and, within minutes, the purchased bitcoins will be available on their bitcoin vouchers.

Step 3 - Buying Bitcoins with Bank Accounts

Once you have purchased bitcoins you can transfer them to any other wallet. Many users will sign up for a bitcoin exchange online to purchase bitcoins and then transfer them to a private key wallet for security. The availability of the any of these payment methods is subject to the area of jurisdiction and exchange chosen. The user clicks the "Buy" tab to buy digital currency and the "Sell" tab to sell digital currency. You select which currency you are buying/selling and which payment method (your bank account or credit card) you want to use.

Bitcoin Exchanges

Choose a bitcoin exchange service may not be so simple depending upon where in the world a person lives. Setting up and securing a bank account to be used with your online exchange can stop many users before they can really get started. Online bitcoin exchanges typically fall under government controls and will require proper documentation including use of identifying documents licenses etc.

For most people in the developed world with access to proper bank accounts obtaining Bitcoin through an exchange can certainly be one of the easier ways to buy Bitcoin. A bitcoin exchange works like any other currency exchange: The user must simply register and convert whatever their currency is into Bitcoin. There are hundreds of available international bitcoin exchanges, and the best exchange option depends on where you are located, but the more well known exchange services include:

Binance: This is a Singapore Based wallet service which allows user to trade Singapore Dollars for Bitcoins. The company currently has only web platform which is also mobile friendly.
CoinBase: This popular wallet and exchange service will also trade US dollars and euros for Bitcoins. The company has web and mobile apps for more convenient Bitcoin buying and trading.
CEX.io: This exchange service offers users the ability to store, send, receive, and exchange Bitcoins. Deposits via credit cards are available almost in all countries. You can use your ordinary VISA/MasterCard in USD, EUR, or your local currency.

Step 5 - Secure Your Bitcoins

Once you have your bitcoins it is important that you secure your bitcoins. Whatever security system you chose just make sure you use it and dont lose it. Backup your private keys and seed phrase. Back them up in moire than one location. Develop and use a secure password system so you never forget or lose a password. Its no good to buy bitcoins and then lose them.

Not your keys, not your coins!

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