If you had bought $1000 worth of Bitcoin back in 2012, that would now be worth $1,200,000. That is over an 100,000% increase, dwarfing all other assets.
The best place to take advantage of this volatility is through one of the regulated platforms highlighted below. Being regulated means that these brokers are accountable and have plenty of safeguard measures to protect your money.
They offer the easiest and safest way to invest in Bitcoin as well as other cryptocurrencies.
To find out quickly how to buy Bitcoin Watch our Video!
What is Bitcoin?
Bitcoin offers safe, fast and a cheap method to pay or make cheap transfers, with countries borders being no issue. Buying bitcoins, or Bitcoin tokens, can also be a good way to keep your savings safe, invest your money and to speculate on price fluctuations.
- 1 What is Bitcoin?
- 2 Bitcoin the leader
- 3 Buying BTC Currency – Shall I do it?
- 4 Should I Purchase Bitcoins or Altcoins?
- 5 Where to buy Bitcoin online
- 6 Walk-through Video
- 7 How to buy Bitcoin – Step-by-Step Guide.
- 8 Get a Crypto wallet and hold Bitcoin
- 9 Buy Bitcoin through exchanges (not recommended)
- 10 Commissions when buying Bitcoins directly
- 11 Coinlist’s Bitcoin Recommendation
Bitcoin the leader
Bitcoin was the first cryptocurrency to be developed. Everything else has followed the path laid by Bitcoin.
Bitcoin has had some problems, like anything, trying it first meant it fell over first. But every time it gets up, it gets up bigger and stronger. As I write this, Bitcoins market cap is over three times of that in second place. Showing that investors have most faith in the original cryptocurrency.
There have been plenty of other cryptocurrencies following Bitcoins lead and are doing well, with some innovative ideas, but Bitcoin still strives forward as the market leader.
Traditionally you gauge the Bitcoin price to the US dollar and you will often see the Bitcoin symbol as BTC/USD, which essentially is the Bitcoin dollar value.
Buying BTC Currency – Shall I do it?
Bitcoin is not just a fad. It is worth nearly $100 billion. That cannot be ignored by all the naysayers. This market has seen the most growth of any market in the financial sector and despite calls that the cryptocurrencies are in a bubble, there are still two counter arguments that should get you involved in the crypto market:
- Bubbles can last for decades, ride it while it’s going up!
- There is real innovative technology behind the cryptocurrency. The underlying value of blockchain technology is high
The invention of the blockchain will change the world. Already there are companies giving access to the technology, to SMEs (small and medium enterprises). Which will in turn dramatically improve efficiency in these businesses.
Investors can see the clear value that Bitcoin has and that is why we have seen growth over 5000% in 2017 alone.
Should I Purchase Bitcoins or Altcoins?
Altcoins are basically every other cryptocurrency that isn’t Bitcoin. The fact they gave that concept a name shows you the power Bitcoin has in the market.
That is not to say that other cryptocurrencies do not have value. Ethereum is currently sitting second in the market cap table. Ethereum have developed a blockchain that can run side blockchains at the same time. This essentially means that you can develop your own cryptocurrency without building your own blockchain.
And there are more coins that offer good investment opportunity, Ripple, Litecoin, Dash, to name a few, are all exciting prospect. With all these new coins cropping up, cryptocurrency reach is increasing and there is now a vast amount of information you can get your hands on, websites such as invezz and buyripple offer great insights into other cryptocurrencies.
Whilst Bitcoin and Ethereum lead the way, there are lots of dodgy coins out there. It is advisable to stick with the reliable coins for investment purposes.
Where to buy Bitcoin online
There are two avenues to go down when looking to buy Bitcoins online. You can either buy them directly or indirectly. Buying Bitcoin directly means that actually own the asset and must go through several stages to own it. The other avenue is to buy Bitcoin as a CFD.
CFDs, or contracts for difference, give you exposure to the price fluctuations without having the hassle of finding the correct wallet and downloading it. That is not to say that buying directly does not have its advantages.
eToro – Advantages of Bitcoin CFDs
Other Advantages to using eToro:
- Crypto CopyFund
- Accepts Paypal and multiple other payment methods
- Very low spreads and almost zero fees
How to buy Bitcoin – Step-by-Step Guide.
Get an Account
- Go to etoro.com and click ‘Join Now’.
- Fill in the fields with your first name, last name, username, email, password and phone number. Tick the ‘Terms & Conditions’ box and click ‘Create Account’.
- You will then be taken to the trading platform. This is where you will be able to buy Bitcoin.
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- FCA Regulated
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- 83% CryptoFund Return
- Next you must deposit funds into your account. Click the ‘Deposit Funds’ button in the bottom left corner.
- Next you will be asked to enter how much you intend to deposit. Once you have decided, enter your payment method of choice. Your options are; Credit / debit card, Paypal, Wire Transfer, UnionPay, Sofortuberweisung, Skrill, Neteller, plus many more! If you choose via card, enter your card number, expiry date and CVV.
- Scroll down the page and enter your billing details, this will include your name, address and phone number. Once complete, click ‘Submit’.
- You now have a funded eToro account. You will receive an email to confirm this and you can tell because your equity will be shown at the bottom. To buy Bitcoin, go to the next section ‘Buy Bitcoin’.
- If you want to deposit over €2000, for security reasons you must verify your identity. This is done by clicking the ‘Complete Profile’ and following the steps required. You will be asked to verify your identity using a passport or other accepted ID and also to verify your address, this can be done by sending in a copy of a utility bill or bank statement. Once verified, you can deposit over €2000.
- Click ‘Trade Markets’ on the side bar. Then at the top you will find the different markets you can buy. Unfortunately Bitcoin ETFs are not available yet. Click the ‘Crypto’ section
- You will then see all the cryptocurrencies you can buy. Choose Bitcoin and click the price with a ‘B’ next to it.
- Next you can decide how much you want to buy. Click ‘Open Trade’ and congratulations, you have just bought Bitcoin!
The next option is to directly buy and own Bitcoin. To do this you must own a wallet. eToro will soon be offering you the opportunity to open a wallet with them but until that happens you must get a wallet from a different source.
Get a Crypto wallet and hold Bitcoin
There are various platforms that act as intermediaries in the purchase of Bitcoin online. Before you buy Bitcoin directly you must own a wallet, which will involve getting a Bitcoin address.
Getting a wallet involves deciding on a provider to use and then either downloading a wallet or using a web browser version. Most exchanges offer you the opportunity to use their wallet or you can normally get a wallet via the cryptocurrency directly.
There are two main places to buy Bitcoins:
- Peer-to-Peer platforms. A great example being LocalBitcoins, which connects buyers directly to sellers. This is a simple process but there are risks attached. Make sure to do your due diligence regarding the person on the other side of the trade. Check their reputation and preferred payment method.
- Exchanges. Platforms like Coinbase facilitate the buying process. You can buy online, either using your credit card or via bank transfer.
You can also buy them directly from another person in cash, or make some kind of exchange. This currency is still readily available and has as many possibilities are those offered by cash.
Buy Bitcoin through exchanges (not recommended)
Below are a few examples of the best exchanges and peer-to-peer exchanges available at the moment. As highlighted earlier, one issue with these exchanges is the time it takes to verify your account.
This can be a problem because they cap the amount you can initially deposit. To deposit larger amounts can often take weeks if not months.
Commissions when buying Bitcoins directly
When you buy Bitcoin through an exchange you will be charged a commission. This will vary depending on the exchange you are going through but will normally lie between 1% and 5%. As an incentive for you to buy more Bitcoins, the fee is reduced the more you buy, which is not the nicest of tactics.
For example, in Coinbase they charge you a commission of around 1.49% in both purchase and sale. At LocalBitcoins you can make transactions without having to pay a commission to the platform, but commissions are necessary to maintain the system, so it isn’t negative either, as miners need to receive some sort of compensation for their block work and you’ll get Bitcoins in your wallet much faster.
But ultimately it costs you more than it would if you were trading CFDs.
Coinlist’s Bitcoin Recommendation
As highlighted in this page, buying Bitcoin is easy! Deciding how you buy it is down to you. For beginners we feel that buying Bitcoin through a regulated provider is considerably safer than an exchange, which can be more complicated.
When you first start out, having someone to speak to is so important and exchanges do not offer that. Brokerages are regularly audited by the FCA to make sure your needs are adhered to.
Once you have a better handle of the workings of the crypto market, then perhaps invest directly in Bitcoin. But until then, we advise risk management, and that comes in the format of regulation.