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A step by step crypto currency guide to buying Bitcoin

A step by step crypto currency guide to buying Bitcoin

Bitcoin was invented in 2009 by a person (or group) who calls himself Satoshi Nakamoto. His stated goal was to create "a new electronic cash system" that was "completely decentralised with no server or central authority." After cultivating the concept and technology, in 2011, Nakamoto turned over the source code and domains to others in the bitcoin community, and subsequently vanished.

Bitcoin is the most popular and well-funded cryptocurrency on the market today. While it's just one of thousands of digital currencies, it's widely regarded as the most successful and influential of its kind - although the currency has fragmented a number of times since its inception.

So How Do I Buy Bitcoins?

You can buy Bitcoins directly from other people using online marketplaces, no different than any other product or service. Alternately, you can also use a digital currency exchange or broker such as Coinbase, Bitstamp, Kraken and Gatehub. Coinbase is one of the biggest U.S. cryptocurrency exchanges. For a beginner, it’s best and easiest to use one of these exchanges.

Step 1: Constant Vigilance

It really is the Wild West out there, so be careful. The number of phishing scams and outright fraud is growing exponentially. The signal-to-noise ratio for quality news and educational content is small, which unfortunately allows scammers to do their thing.

Step 2: Look for a Good Bitcoin Wallet

Bitcoins are stored in specific digital wallets. They are stored here as they await spending or exchange for another currency. There are plenty of wallets nowadays that can be easily downloaded and installed on personal computers or even mobile phones. Wallets are differentiated by their features, their safety and the platforms upon which they can be used.

It is therefore important that you choose one that works best for you. It is highly recommended that as a beginner, you start with a simple to use wallet that allows you to transfer funds easily. They can be downloaded for free.

Step 3: Visit the exchange you’ve picked out

Maybe it’s Coinbase, Poloniex, CEX.io, Kraken, Bitfinex, BitPanda, or BitStamp. Register with the exchange. Again, you’ll need your name, email address, password. Most exchanges require you to connect with your bank account to pay for your Bitcoin purchase.

Some exchanges like Coinbase offer an app that acts as an exchange and a wallet. Through the app, you can both buy and trade Bitcoins as well as store them. That’s fine, but remember that just because you use the Coinbase exchange doesn’t mean you have to use the Coinbase digital wallet. There are many other digital wallets out there. (And exchanges, for that matter.)

Step 4: Choose a Method of Payment

Depending with what the exchanges are willing to use, you will have several payment options. Most exchanges accept credit card and bank transfers. You could also use other forms of payment such as Skrill or PayPal. Coinbase allows most of these methods of payment. With bitcoin ATMs, you can exchange your bitcoins for cash. However, these ATMs are only available in a few select cities round the country.

Step 5: Buy and Store Your Bitcoins in Your Wallet

Most exchanges will let you know the number of bitcoins that you can buy for a specified amount of cash. At the moment, one bitcoin is worth more than $8,000. This means that if you cannot afford to buy a whole bitcoin, you have the option of buying a fraction of it. For instance, if you had $500 today, you would be able to buy 0.0625 bitcoin.

After buying the currency, you then transfer it to your address on your wallet. A small fee might be levied for this transfer. Once you have made a payment at the exchange and transferred your bitcoins to your wallet, you should be able to check your balance any time. Every transaction is recorded in a blockchain. Due to the large number of trades taking place at any given time, the transfer of bitcoins might take some time before it reflects in your wallet.

Step 6: You Can Now Trade With Your Bitcoins

Once the bitcoin is in your wallet, you can become a cryptocurrency trader. Other people buy bitcoins as an investment, and not as a means of trading. With your bitcoins, you are now free to transact, buy or sell bitcoin or even make payments to retailers that accept payments in this digital currency.

Need help choosing the right bitcoin training course? Find out more about the bitcoin course we offer at London TFE and get the most out of your bitcoin training.


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