Where to buy Bitcoin

With the popularity of Bitcoin (BTC) being higher than ever before, there are now a variety of places where cryptocurrencies can safely be bought. The most popular places to buy Bitcoin are cryptocurrency exchanges, peer-to-peer (P2P) marketplaces, Bitcoin ATMs, and online brokers.

In this article, we’ll take a look at the various ways in which Bitcoin can be purchased and provide you with all of the information you need to make an informed decision. If you’re interested in buying Bitcoin, keep reading to find out more.

How to store Bitcoin

Before buying Bitcoin, users need to consider where they are going to store their cryptocurrency once they have it. Bitcoin is a digital asset that is difficult to recover once it is stolen or lost, as it is not overseen or protected by a financial institution or government body, so it is imperative that it is stored safely and securely. There are several ways that cryptocurrency can be stored, but the most popular ways are via hardware, software, or the use of an online wallet. Each has their own benefits, which we’ll outline below.

Hardware wallet

A hardware wallet, also known as a “cold wallet”, is a physical device such as a purpose-built, encrypted hard drive that stores private keys. This form of crypto wallet is similar to a USB drive and provides an extremely high level of security, as the digital currency is being stored offline and is therefore protected from hackers. The most popular forms of hardware wallets are Ledger Nano S, KeepKey, Coldcard, and Trezor. There are some downsides to using hardware to store crypto however, such as the fact that it can be lost, broken or stolen. Hardware wallets can also be expensive and users may not have the required technical knowledge in order to set up and use them in the most secure way.

Software wallet

A software wallet is an application on a computer or mobile phone that stores the private keys. This type of wallet, also known as a “hot wallet”, is mainly used by those who invest in Bitcoin and need to move their digital assets frequently. The most popular forms of software wallets are Exodus, Mycelium, Jaxx, and Electrum. Unlike hardware wallets, software wallets are more susceptible to being hacked so it is not recommended to store large quantities of Bitcoin on them. It is important to thoroughly research software wallet providers and choose one that is reputable, reliable and has good security measures in place to protect an individual and their Bitcoin.

Online wallet

An online wallet, also known as a web-based wallet, is a Bitcoin wallet that is based entirely online with users' private keys stored on a remote server. The most popular forms of online wallets are Coinbase, BitGo, GreenAddress, and Blockchain.info. Like software wallets, because the information is stored in a server, online wallets are susceptible to potential hacking attacks and security breaches. It is important to thoroughly research online wallet providers and choose one that is reliable and has the highest level of security possible.

Where can Bitcoin be bought?

Now that we’ve covered where your Bitcoin can be stored once it has been purchased, we can now take a look at the various ways in which you can buy it. Like the storage options, there are various ways in which you can get your hands on some Bitcoin and they all have their own pros and cons. We’ll outline them below.

Cryptocurrency exchanges

Bitcoin and other cryptocurrencies can be purchased from a crypto exchange. A crypto exchange is an online trading platform, similar to traditional stock exchanges, where cryptocurrencies can be bought, sold, and traded between users. The most popular online crypto exchanges are Coinbase, Binance, Kraken, Bitstamp, Crypto.com, Huobi, Bitfinex, and Gemini.

At these exchanges, which can be either decentralised or centralised, users can place, buy or sell orders for cryptocurrency at a specified price. Users can buy Bitcoin using traditional payment methods such as a credit card, debit card, PayPal, via bank transfer or even by using other cryptocurrencies. The exchange will then match the orders to execute the trade, which can be bought using fiat currencies like US Dollar (USD) or Euro (EUR). Some exchange platforms will offer advanced trading features like wallet services to store cryptocurrencies, margin trading, future trading, and fiat currency trading pairs. However extra features may come at an additional cost, so be sure to check this before using an exchange platform.

For those who invest in and trade Bitcoin long term, this variety in cryptocurrencies can provide them with many profitable investment opportunities. Unlike traditional financial institutions, crypto exchanges normally have much lower transaction fees and are a more affordable way for users to sell and buy cryptocurrency.

The security of cryptocurrency exchanges is typically advanced, as you’d expect for a platform that is used for trading a secure form of digital payment. They tend to have two-factor authentication and enhanced encryption, meaning users' funds and personal information are well protected. It should be noted, however, that using a cryptocurrency exchange does come with risks, such as the potential for fraud and hacking. Make sure to thoroughly research any exchanges before using them and choose one known for its excellent security and reliability.

Peer-to-peer (P2P) marketplaces

P2P marketplaces can also be used to purchase Bitcoin online. These marketplaces are decentralised, meaning they directly connect buyers and sellers of Bitcoin with no central authority overseeing transactions. The most popular P2P marketplaces are LocalBitcoins, Bisq, HodlHodl, LocalCoinSwap, and Paxful. A P2P marketplace works by matching buyers and sellers of cryptocurrency depending on their transaction requirements, such as how much crypto they are trading and their preferred payment method.

Users are able to negotiate their own terms for transactions, like their preferred payment method and price, without the need for a third party to transfer or hold their funds. Once the match is made, the buyer will send the funds to the seller and the seller will then transfer the cryptocurrency to the buyer's wallet. A P2P marketplace offers lower transaction fees than centralised exchanges, as well as more flexible transaction options.

In order to protect all users, most P2P marketplaces use an escrow system that holds funds in a secure account until the transaction is securely completed and both parties are satisfied. It should be noted, however, that using a P2P marketplace does come with risks such as the potential for fraud and scams. Make sure to thoroughly research any P2P marketplaces before using them and conduct due diligence before going ahead with a transaction.

Bitcoin ATMs

A Bitcoin ATM works in the same way as a traditional ATM, except it can be used to sell and buy Bitcoin. These ATMs connect sellers and buyers directly without the need of a centralised exchange. The most popular Bitcoin ATM providers are CoinFlip, Bitnovo, Bitcoin Depot, Coin Cloud, and General Bytes, with services like Coin ATM Radar allowing users to geographically locate the ATM closest to them.

Bitcoin ATMs have become more common in recent years, particularly in larger cities, and they are normally located in accessible public areas, which makes them more convenient to use. Bitcoin ATMs are user-friendly, as the general public does not need to have vast knowledge about cryptocurrency in order to use them. For crypto to transfer to and from the ATM to a wallet, users only need to insert cash or a debit card into the machine and scan the QR code of the specific wallet they want the crypto to be stored in.

One of the great things about these ATMs is that they are available 24/7 and transactions process within a few minutes. This is unlike bank transfers which can take several days, but it should be noted that Bitcoin ATMs sometimes have higher transaction fees compared to centralised exchanges and P2P marketplaces.

Online brokers

An online broker can also be used to buy and sell Bitcoin. A broker is an online trading platform that allows users to monitor the price of Bitcoin, manage their portfolio, and execute trades all in one convenient place. Online brokers are accessible to users of all experience levels and this large user pool helps increase the liquidity of Bitcoin, allowing trades to be completed quickly at a fair market price. The most popular online brokers are Robinhood and eToro. Online brokers offer a wide range of easy-to-use and streamlined trading features, including news and market analysis, charting and technical analysis tools, and educational resources.

These features help users to make informed decisions about when to sell and buy cryptocurrency in a convenient way, as an online broker can be accessed via the internet. Users can buy and sell Bitcoin at an online broker using a range of payment methods, with many offering lower transaction fees, unlike when using Bitcoin ATMs.

Online brokers are normally regulated by financial authorities and offer advanced security measures like encryption, meaning users' funds are secure and safe. It should be noted, however, that using an online broker comes with risks such as market volatility or hacking and security breaches. Always make sure to invest responsibly and thoroughly research any online brokers before using them and choose one which is trusted.