Bitcoin is becoming more and more prominent. It is unavoidable and undeniable at this point. But the question remains… Where is the best place to buy Bitcoins?
Well, let’s dive into all of the options available to us and decide which is best for you!
First, we’ll walk you through some of the greatest centralized exchanges available – then we’ll give you another idea on buying and even storing Bitcoin!
Crypto Exchanges
The most common point of purchase for most of you is going to be a cryptocurrency exchange. A cryptocurrency exchange hosts a marketplace for you to buy and sell various cryptocurrencies, as well as direct purchases using various payment methods, like debit card.
These centralized exchanges all offer different incentives to use their exchange. Let’s look at some of the top exchanges out there and how they compare!
Coinbase
Coinbase is an excellent beginner’s choice to purchase your first Bitcoin. As one of the most popular exchanges available, Coinbase has excellent customer support, ease of use and rates for a crypto beginner.
Coinbase is used by over 70 million people in over 100 countries. They hold hundreds of billions in assets and account for hundreds of billions of trade volume every quarter.
Not only can you buy Bitcoin, but Coinbase lists hundreds of other cryptocurrencies for you to buy. For example, Ether, Doge coin, Shiba Inu, Avalanche and many more!
When purchasing Bitcoin or any other crypto with normal money, you will pay around 0.5% in fees to Coinbase. This varies depending on the market, and Coinbase’s fluctuating trading fees, but this is the general rate. You can upgrade to Coinbase Pro for improved trading fee rates.
Pros
- You can trade hundreds of top coins
- 2-factor authentication for safety
- They have educational content on their platform
- You can even earn some free tokens for watching their educational content!
Cons
- Transaction costs can be higher than other platforms
- Spread pricing can increase transaction costs
- Not available in all countries
Overall, we like Coinbase and think it is a perfectly good exchange. You get a cryptocurrency wallet, you can buy Bitcoins, sell Bitcoins, send Bitcoin… Almost anything you would need to do with Bitcoin can be done with Coinbase!
eToro
eToro is another very popular platform to get Bitcoin from.
Interestingly, they have a demo mode which allows you to trade crypto without actually risking funds. You could start with $100,000 play money to test out crypto trading to see if it’s right for you. They also have a CopyTrader system that allows you to mimic trades from others on the platform without paying additional fees.
Like most platforms mentioned in this article, you can buy the other top cryptocurrencies from eToro too, like Dogecoin, AVAX, Polygon and so on.
With eToro you can access other investment vehicles like buying particular stocks, indices and more.
Pros
- 15-year track record, so they are extremely well established.
- You can buy regulated investments through eToro
- Regulatory licensing in the UK, Europe and Australia
- Perfectly fine to purchase Bitcoin on
- Credit card purchases, wire transfers etc.
Cons
- Higher than average minimum trading requirements. To get involved with the CopyTrade system you need to spend at least $200. Starting with crypto trading requires more funding than the average exchange, too.
- High spread fee for Bitcoin purchases.
Binance
Binance is one of the most popular crypto exchanges in the world. Binance also has the Binance Smart Chain, their own blockchain, where many developers are launching crypto projects (e.g. Safemoon).
Binance is one of the best exchanges to use thanks to their fair fees and a large list of options to buy coins from. There are also tons of staking, borrowing and trading options.
They are constantly being dragged into legal battles and getting neutered in various countries, but they often come back… Like the Undertaker!
Pros
- Huge list of cryptocurrencies to buy, not just Bitcoin
- Enjoy staking, Futures trading (leverage), peer-to-peer payments, lending and more.
- Relatively low fees considering the other benefits
- Most popular exchange, meaning relatively safe, secure, and trusted
- A few different ways to buy Bitcoin with
Cons
- The verification process can be clumsy and take time
- Unclear corporate structure
- Binance can sometimes be shut down in various countries as rules and regulations change. Check your jurisdiction to see if you can use Binance!
Robinhood
Robin Hood is yet another great place to buy and trade Bitcoin.
A great benefit of Robinhood is zero fees charged when buying Bitcoin or any other crypto.
You will still have to pay the spread (difference between the bid and ask price), but there are no fees charged This is a great benefit to buying Bitcoin on Robinhood. It could be a good place for a beginner to simply buy some Bitcoin and leave it there on the platform.
Pros
- Zero fees on Bitcoin buys and sells
- Easy to use platform
- Invest in more than just crypto
Cons
- Limited cryptocurrencies listed, you can only select from the highest market capitalization coins. Makes sense seeing as they are into other investment vehicles too
- No crypto exchange wallet
Robinhood is a great place to make a Bitcoin purchase. Especially if you only plan to buy and hold Bitcoin. It’s not the best exchange account if you wish to do more than just purchase Bitcoin, but it is great for escaping transaction fees.
CoinMama
Another good place exchange for crypto investors to buy Bitcoin!
CoinMama is a good choice for you because it has a fast account setup and verification process. Some other exchanges are slow and have lengthy verification processes. Once signed in, you can buy Bitcoin instantly using various different payment models. However, for instant purchases, the fees are a bit higher.
Pros
- Instant Bitcoin purchasing
- Easy to transfer to other crypto digital wallets
- Various payment methods are available, e.g. credit card
Cons
- Complex fee structure depending on your choice e.g. higher fees for instant purchasing
- Limited options in some countries like the USA
We like CoinMama as a way to get the casual investor into Bitcoin. It’s one of the easiest ways to buy Bitcoin. Making cryptocurrency investments can be tricky, especially for a beginner, so it’s refreshing how simple CoinMama is.
BlockFi
Another fine exchange to use to get Bitcoin!
We like BlockFi because it gives you a lot of options.
BlockFi allows you to stake your Bitcoin and earn a yearly interest on it. Moreover, you can use your staked Bitcoin as collateral to gain USD, and then invest in other digital currencies should you wish! They also have a BlockFi card you can get to earn rewards and bonuses.
BlockFi‘s yearly loan repayments can be quite high – so we recommend lending to those who are financially educated. Even though Bitcoin’s yearly performance has been strong compared to many assets, you can quickly get into trouble if you borrow and don’t know what you’re doing.
Pros
- Earn a yearly yield on your Bitcoin
- Use your Bitcoin as collateral for a USD loan
- No added fees when making cryptocurrency trades (just spread fee)
- Attractive referral scheme
- Different investment vehicles to choose from
Cons
- Loan interest is high, only those familiar with lending should use this
- Not a huge list of cryptocurrencies to buy, just the major coins
Bisq
Bisq is an interesting option because it is a decentralized exchange (unlike the others on the list, which are centralized exchanges). You don’t need to signup or create an account. You can use Bisq to buy and sell without having to give away your identity. The Bisq app you’re required to use is open source and free.
You can get fiat money onto Bisq via multiple channels. These include bank transfers, Chase QuickPay, Western Union and more.
Trading fees are also relatively low!
Pros
- A decentralized exchange unlike the other exchanges on this list
- Software is open source because it is decentralized
- No need to go through a lengthy sign up/verification process
- They have a DAO (decentralized autonomous organisation) you can get involved with
- Gives you a “secure wallet”
Cons
- Transactions can be slow
- Not the best platform for active traders who are looking to do anything more than simply long term holding, for example, it doesn’t have all the features of a BlockFi or a Binance (but it is decentralized)
So Which Exchange is Best For Buying Bitcoin?
Overall this is for you to decide.
Not all exchanges are made equally. Perhaps you wish to trade, stake, or borrow your coins. In that case, Binance or BlockFi could be a good option for you.
However, perhaps Binance isn’t allowed in your country. You could look at Coinbase for a good all-around option.
Or perhaps anonymity is vital to you, so Bisq could be a good option.
Or perhaps you want to set and forget your Bitcoin and already have a Robinhood account. Well, Robinhood would be a good choice for you!
The right place for you to buy Bitcoin comes down to you and your individual needs. A good option could be to simply sign up to multiple exchanges and see which suits you best. Many exchanges won’t work for you – so find one that does!
Decentralized Exchanges, The Better Alternative?
New crypto investors should use one of the centralized exchanges listed above. It is the easiest way to get into the cryptocurrency markets. You simply go through the verification process, and then use credit or debit cards to then purchase your crypto. This is the best way, in our opinion, to go from”no-coiner” to crypto investor.
However, from here, we recommend you move at least some of your funds over to a decentralized exchange. The short reason?
Not your keys, not your crypto.
The whole point of crypto is to own your digital assets. When you keep your purchased Bitcoin or any other currency on an exchange, the exchange owns your cryptocurrency, not you.
So, the best thing to do is to get your own cryptocurrency wallets, like MetaMask and Trust Wallet. These exchange online wallets are not as safe as simply holding your coins yourself, with your own password. No one can take your Bitcoin away from you if only you have access to the seed phrase (password).
Also, you are limited to the services your centralized exchange offers should you keep your digital currency there. However, if you keep your Bitcoin in your own online wallet, you can connect to the thousands of DApps (decentralized applications) out there, where you can access all kinds of financial instruments.
Ultimately, buying Bitcoin and getting started is best achieved through a centralized exchange, but you will want to venture over to the world of decentralization as soon as possible…
FAQs
An exchange is simply a marketplace where you can buy and sell cryptocurrencies.
Many a cryptocurrency exchange will allow you to purchase Bitcoin straight from your debit card. You simply open the exchange, create your account, select your payment method, and then purchase Bitcoin directly.
The other option is to use cryptocurrency exchanges to trade cryptocurrencies rather than simply buying them with fiat money from your preferred payment method.
You will swap fiat money for a cryptocurrency like Bitcoin. You will be buying it from a seller on the open market hosted by that exchange. As you can see above, different exchanges are going to suit different needs, so find what is best for you.
Exchanges work by being an intermediary between buyers and sellers of the cryptocurrency available on their exchange. They take fees from those who use the exchange services, like trading, lending, staking and more.
The exchange is simply an intermediary between you and other buyers/sellers. They are simply enabling the transaction to take place for you. If you are trying to trade Bitcoin, you will be buying it from a seller on the exchange’s open market.
Some exchanges offer peer-to-peer services where you can trade USD (or another fiat currency) for the cryptocurrency you want. This is as opposed to buying it on their open marketplace. Binance offers a peer-to-peer service like this.
In some jurisdictions, it is illegal to buy Bitcoin from an exchange, but not all of them of course! As you will see from the news, Bitcoin is often getting banned in countries around the world. Make sure to check out your local laws so you don’t break any.
In most cases, buying Bitcoin on an exchange is perfectly legal. For example, those in the UK, US, Europe and Asia should all have the means to buy Bitcoin from an exchange. Sure, not every exchange is going to be open to you, but some will.
Remember to keep track of your activity as cryptocurrencies are an asset and you might be liable to pay some sort of tax on them, or the gains you make from them.
A Bitcoin exchange is where you can buy and sell Bitcoin whereas a cryptocurrency wallet is exclusively somewhere to store your Bitcoin and or other cryptocurrency investments. Most exchanges have a crypto wallet included when you create an account with them. This means you have a crypto wallet hosted on the exchange. The exchange is essentially storing your crypto for you.
A wallet is a place for you to hold your crypto. For example, Trust Wallet is a place to store crypto. You simply create an account and send your crypto there.
Many people contend that you should keep your crypto in your own wallet. When you leave your crypto on an exchange, they are essentially holding it for you and could lose it. However, if you have your own wallet where only you know the private key, you should have better security of your Bitcoin and or other coins.
Bitcoin exchanges are a place you can buy and sell Bitcoin. In many cases, the exchange also includes crypto wallets, which is the account that holds your cryptocurrency. When you use a centralized exchange online or through a mobile app, the exchange effectively will hold the Bitcoin on your behalf.
Bitcoin also enables you to use external wallets outside of an exchange. These include computer-based and web-based “hot wallets” and offline “cold wallets”. If you buy Bitcoin at most exchanges, you have the option to transfer your coins to any Bitcoin wallet. It's our recommendation that you do this and gain full custody of your Bitcoin.
You should be safe buying Bitcoin should you use a safe and respected centralized exchange. You should have no problems if you buy Bitcoin from any of the exchanges listed above.
Bitcoin itself is obviously a volatile asset, so there is a chance you could lose funds by your bitcoin position decreasing in value.
Many also lose their Bitcoin by losing their password to their private wallet. A benefit of using one of the exchanges listed above is that you should be able to gain access to your account should you get locked out by proving your identity. This process can be clumsy, but at least you may be able to regain access to your funds.
This is a simple guide to buying Bitcoin:
Choose an exchange that makes sense for you. Any of the exchanges listed above would work.
Create an account and verify it. Again, find an exchange that suits you and how much information you are happy to depart with in order to get an account.
Add funds to your account. You will need to add fiat currency to your account to be able to trade it for Bitcoin or buy Bitcoin.
Buy your Bitcoin! Depending on the exchange you will have different options available to you. Most will allow you to purchase Bitcoin directly. Platforms like Binance will allow you to set the price you wish to buy Bitcoin at if you want to buy it at a lower price.
Great! Now you know how to buy bitcoins. Congratulations!
