Why buy Bitcoin
Today, Bitcoin advocates see the software as an alternative money system offering users the ability to exit their government economy and claim sovereignty over their financial assets.
Investors in BTC, likewise, view it as an alternative to hard assets with a finite supply like gold, silver, and other commodities.
Where can I buy BTC
- Direct Purchase
You can purchase it directly from another individual in person or over the web.
- Crypto ATM
You can try to locate a crypto ATM near you that offers Bitcoin.
- Exchange Many find that it is easiest to purchase it through an exchange.
How to buy Bitcoin
Step 1: Find a reliable Bitcoin wallet
Digital “wallets” store Bitcoin until you are ready to spend them or exchange them for another currency. Wallets range in terms of features, platforms that accept them, and level of security, so it’s essential to choose one that works for you — though you should probably steer clear of the one evangelized by John McAfee.
For those just getting started, your best bet is to use the wallet that’s automatically provided to you on our recommended exchange, Coinbase. However, it’s also a good idea to set up a wallet that’s not linked to a crypto-exchange to ensure you’ll have ready access to your Bitcoin even in the event of overwhelming traffic or site closure.
Here are our recommended options:
Exodus: An all-in-one offline application with support for several cryptocurrencies, including Bitcoin, Exodus is free to use, has built-in shape-shift trading, and includes some simple graphing tools to help you visualize your cryptocurrency portfolio.
Mycelium: This one is a popular mobile wallet known for being compatible with more advanced tech, like Trezor hardware wallets (for maximum security) and Tor.
Bitcoin Core: A free and open-source choice that serves as a Bitcoin node, Bitcoin Core does an excellent job at verifying payments, only accepting payments from valid blockchains.
For a look at a few other of our favorite wallets, here’s a more in-depth guide to the best Bitcoin wallets.
Note: Although an online wallet is excellent for your first Bitcoin purchase, if you find yourself with many valuable cryptocurrencies because of trading or an upswing in value, make sure to store it in an offline “cold storage” wallet for maximum protection.
Step 2: Choose the right Bitcoin trader
The best place to make your first Bitcoin purchase is on an exchange. There are a whole lot of exchanges out there, with varying performance. Some are less trustworthy than others, and some can be quite limited, so it’s crucial to pick the right exchange in the first place. We recommend using Coinbase, though there’s no harm in checking out the competition using a Bitcoin exchange comparison site.
Signing up for a Coinbase account is easy, though you will need to provide some form of identification. That may involve sending a copy of your photo ID and potentially sending a live image of your face via webcam. These rules are essential to follow as they allow the site(s) to comply with know-your-customer regulations.Although Coinbase alone will allow you to buy and sell Bitcoin, it’s also worth signing up to its linked exchange platform, Coinbase Pro, which will give you greater control over your purchases.
If you would prefer a more direct route in buying Bitcoin, you can opt to use a peer-to-peer service such as LocalBitcoin or BitQuick. They offer a more extensive array of payment options and let you purchase Bitcoin directly from a seller without the exchange middleman. If you do opt to use these and plan to trade in person, make sure to meet in a safe place.
Step 3: Select your payment method
Exchanges accept a variety of payment options, though one should be wary of scam sites. Coinbase allows both bank account and credit or debit card transfers for payments, though one payment solution must be linked to your account before you can make a trade. Coinbase recently added PayPal as an option for transferring Bitcoin, though there are certain caveats.
Note: Bitcoin ATMs allow you to exchange Bitcoin in compatible wallets for cash. These ATMs are available in a limited number of cities and provide an alternative to withdrawing money using an exchange. Again, most exchanges and online wallets will not deal directly with cash.
Step 4: Buy some Bitcoin and store them in your wallet
Exchanges provide you with information on how many (or how much of a) Bitcoin you can buy for specific sums of money. However, due to its volatile nature, Bitcoin prices can vary dramatically by exchange and moment to moment. That means that even if you have a lot of money to burn, you’ll probably be buying a fraction of a Bitcoin. There’s nothing wrong with that, and for most people, this is the route they’ll go down, as few but the wealthy can afford to purchase several Bitcoins in one go.
To make your first trade, input the amount of Bitcoin you want to buy in the provided field and click the buy button. On Coinbase or Coinbase Pro, this will be a standard market buy order, which will purchase Bitcoin at the best market rate. Alternatively, you can place a limit order, which lets you set a price you’re willing to pay for a certain amount, and a trade will only happen if that amount shows up at that price.
Once you’ve made your purchase, your newly acquired Bitcoin will transfer into your Coinbase wallet for storage. You should then seek out the option to transfer these funds to the address of the Bitcoin wallet you have created. You will have to pay a small fee to move the funds out of the exchange, but that is part and parcel of Bitcoin transfers. Fortunately, the cost of such transfers is much lower than it has been historically.
Important note: Bitcoin transfers can be a bit sporadic. Unlike other currency trades, when you buy Bitcoin funds, the transaction needs to be recorded and affirmed in the blockchain. The transfer process can take time, particularly during busy trading hours. It’s not uncommon for a trade to take an hour or two to complete, so you may want to plan your transfers accordingly before jumping in.
Step 5: Get ready to use it
Whether you plan to ultimately sell your Bitcoin (hopefully at a profit) or use it to purchase goods or services, be ready to do so at a moment’s notice. The value of Bitcoin currently fluctuates rather wildly, so it is crucial to have your endgame planned out early on. Be prepared by setting up a seller account on an exchange now, or figure out how to buy what you want with it before you endeavor to make a purchase. In that case, when the time comes, you won’t be in a panicked rush to complete your transactions.
How to Sell Bitcoin?
It’s not good having Bitcoin as an investment if you don’t know how you might one day shift it to turn a profit. Digital Trends isn’t about to give out investment advice — that’s not our forte — but we can break down the technical fundamentals for you, like how to sell Bitcoin. There are different ways to go about it, depending on whether you want to sell on an exchange or directly, but here are some steps to take to sell your Bitcoin fast and easily.
Step 1: Set up an exchange account
The simplest and most “automated” way to turn your Bitcoin into hard cash is through an exchange platform. They act as a middleman for the famously decentralized cryptocurrency by selling your Bitcoin for you. Since it’s one of the most popular and well-established exchanges, we recommend Coinbase. If you would rather choose your own, there are many others to pick from, including popular international options like Bitstamp and Bitfinex.
Signing up for an account at Coinbase is easy, but there are some hoops you’ll have to jump through. Depending on which country you’re in, you will have to comply with different forms of “know your customer” rules, which may mean sending the site certain ID forms. That can take a few days to process. Signing up for Coinbase Pro is also recommended, though not strictly necessary, to give you greater control over your sale.
Once your account is created, link your bank account so that when you have made your trade, you can get cash out with as little hassle as possible.
Step 2: Transfer your Bitcoin to your exchange wallet
If you followed our guide on buying Bitcoin, you’d have stored your Bitcoin in a secure — maybe even cold — wallet. To trade on Coinbase, you’ll want to send your Bitcoin to an exchange wallet and keep it there, ready for sale.
Beginners can always use the Coinbase Wallet app, which connects the wallet super simple, as it automatically works with Coinbase trades. Just open the app and wait for the notification to “Connect Now,” then enter your Coinbase login information. If you don’t see the notification, you can always go to Settings and choose Connect to Coinbase to get started. The Coinbase Wallet also has a few other handy features, including paying merchants directly from the wallet if they are part of the Coinbase Commerce program.
Coinbase’s security is excellent, providing support for biometrics and advanced authentication technology. However, if you prefer to use another digital wallet, head to its settings, and look for ways to connect to a currency exchange. You should be able to input your Coinbase login on the most popular digital wallets and start an authentication process to connect it. However, this may take several days to complete, so it’s definitely not a last-minute step.
Step 3: Place a sell order
With your exchange account set up, your bank account linked, and your Bitcoin deposited on the exchange, it’s time actually to make a sale. The latest version of Coinbase makes this very easy. Select Buy/Sell from the top menu and move to the Sell section. Choose Bitcoin as your currency of choice, and make sure the right destination is selected for your funds in the Deposit To section. If you have a bank account connected to your account, you will be able to select it here for a direct transfer.
Check your connected wallet to see how much Bitcoin you have, and choose the amount you want to sell. In 2018, Coinbase raised its default limits for trading and started allowing people to trade their cryptocurrency immediately after buying it, which is one reason we are fans of the service. You can see your weekly bank limit in the same section. Finally, choose if you want to repeat this sale, and if so, at what frequency. Then select Sell Bitcoin. That’s it!
There will be a short holding period before the sale is complete. You can make as many sales during this time as you want, but the transfers won’t finish until their holding period is over.
As for deciding when to sell, well, that’s getting into the genre of investment advice, and there are many strategies based on your long-term plans and how much Bitcoin you want to move. Bitcoin has been going through a long period of devaluation and corrections lately, intermixed with slight recoveries. Some serious research may be required to decide when the best time to sell is for you.
If you’d rather have more of a hand in the actual sale process, direct trades (or peer-to-peer trades) are possible alternatives. You will need to register, which in some cases will mean confirming your identity, so as with all selling methods, we’d recommend getting your account set up well in advance of when you actually want to sell. Once you’re set-up, however, you can sell your Bitcoins in a much more direct manner.
In exchanges, Bitcoin automates trades between the two parties, but there is a different protocol for selling. When you sell, the transaction occurs directly between seller and buyer. You set up a sell order for a specific value, and when someone comes along looking to buy at the agreed-upon price, the site will alert you that you can move ahead with the transaction. When both parties agree on the terms, you first receive payment from the buyer, and subsequently, you send the buyer the cryptocurrency.
The actual method of conducting the payment will very much depend on which platform you make the trade through. Sites like BitQuick keep things exclusively online, using bank account transfers. However, sites like LocalBitcoin or Paxful have far more numerous options, including Moneygram, gift cards, cash in the mail, and even cash in person.
While certain methods may be tedious in their complexity, they function to anonymize the transaction, effectively ensuring privacy and safety, which should take precedence. If you decide to make trades in person, make sure to do so in a public setting.