So, you feel as if you should make your first purchase of Bitcoin? Feel like you might be missing out on something?
Well, good! 🙂 The first step is making a decision. The next one is...
The good news is that it is a lot simpler than you think. Let's first make sure that you understand some of the basic terms and basics of buying and owning Bitcoin.
Where To Buy Bitcoin
In order to buy Bitcoin (or any cryptocurrency, for that matter), you will use an An exchange is a platform that enables you to exchange one currency for another currency. It is a place where people can... Click for full definition.
An exchange is a platform that exchanges one form of currency for another. Exchanges are common when it comes to exchanging country currencies if you are traveling overseas. For instance, if you wanted to exchange US dollars for Euros, you would use an exchange. It is exactly the same for cryptocurrencies.
There are a LOT of exchanges to choose from. In the United States, there are two major exchanges that are very popular and the most common entry points into cryptocurrency:
The one I use is Coinbase. That's just a personal choice of mine. I also think Coinbase is the best entry point for people if you're brand new to crypto. It will feel like a pretty friendly experience.
How To Buy Bitcoin On Coinbase
Click this link to head on over to Coinbase and get started. Yes, this is a referral link. You'll earn a bit of free Bitcoin if you use it, so why not?
Enter your name, email and choose a password. Then hit the button to create your account.
If you go through my link to begin this process, then you will next get a confirmation of up to $15 in free Bitcoin you can get.
Once you hit "Continue", you'll be told to check your email and hit the link to verify your email address. Do that to confirm the email address you used to sign up.
Your next step is to set up 2-step verification. This is simply a security feature to tie your new account to your mobile phone number. If there's ever an issue logging in, you can regain access via text message. Enter your mobile number and Coinbase will text you a 7-digit number. Enter that number into Coinbase to finish this step.
Next, you will verify your identity. This is a legal requirement to comply with "Know Your Customer" (KYC stands for Know Your Customer. It refers to a set of government regulations designed to make criminal activity harde... Click for full definition) laws in the United States. If you want to use a secure, regulated exchange like Coinbase and not worry about a higher risk of fraud, then I recommend you use something like Coinbase that complies with KYC.
You will enter your legal name, birthday and last 4 digits of your social security number. Then, on the next screen, you will need to enter your residential address. You'll answer a couple of other questions... then... that's it!
The next step will be to fund your account. You will link up your new Coinbase account to your bank account. Once your bank is hooked up, you can transfer any amount of money you want. Since you are slated to get $10 in free Bitcoin once you invest at least $100, I would recommend you move at least $100 from your bank over to Coinbase.
Just select your bank, enter the login into, and it will be hooked up to your account as a funding source. It is all done securely, so no worries. And it will not debit anything from your bank account unless you tell it to.
In my case, I entered my bank details. It then asked me to enter the last 8 digits of my debit card. It then asked me to choose which account to hook up to Coinbase. I waited a few seconds for it to verify and... I was done!
The next little piece of legwork is to verify your identify through photo ID. Namely, your driver's license.
Yes, it is annoying. But, again, this is part of legal compliance with US law. Again, if you're trying to hide who you are, don't use Coinbase.
You will need to capture both the front and back of your ID. You can either submit image files (if you wish to use a scanner) or use your webcam to take the photos.
The process usually goes smoothly, but it looks something like this:
- Snap a photo of the front of your driver's license and submit it.
- Snap a photo of the back of your driver's license and submit it.
- Then, snap a photo of yourself holding a piece of paper with text on it as instructed.
You'll then need to sit back and wait a bit while they verify your identity. It doesn't usually take long at all. In my case, it took a minute or two and I got email verification it was done.
Also, keep in mind... you're going to get an extra $5 in free Bitcoin when you complete your ID verification. So... yeah. 🙂
Once that is done, you're ready to buy some crypto!
Just hit the button to Buy. You'll get a popup which looks like this:
Just enter how much Bitcoin you wish to buy, in US dollar value. So, if you want to buy $100 worth of Bitcoin (in order to lock in the $10 bonus), just enter $100. Hit the button to preview the order before it is submitted.
You will see how much Bitcoin you are about to buy, the price at which you're buying it, etc. Also, you will see the fee.
Now, Coinbase charges a fee for their service. You can read about their fee structure here. This is not a fee by the Bitcoin network. This is a Coinbase fee. Their fee percentages change based on the amount you're purchasing.
Once you hit the "Buy Now" button, the transaction is processed. At that point, you now own Bitcoin. 🙂 Now, it takes a few days for your transaction to clear your bank. Traditional finance is slow, what can I say. 😉 But, as it says, in about a week, you can move your Bitcoin away from Coinbase if you choose.
Where Do You Store It?
If you're just starting out (and I assume you are if you're reading this article), then... just keep it on Coinbase. 🙂
Every Sometimes referred to as a token, or a coin. The two terms are used pretty interchangeably. Essentially, it is a digital... Click for full definition that you can buy on Coinbase (and you can buy much more than just Bitcoin), you can store on Coinbase. They supply a We know a wallet as a thing you keep your money in. In cryptocurrency, we use the word wallet to refer, likewise, to a p... Click for full definition for every coin.
Now, as you acquire more Bitcoin and gain a bigger balance, I would recommend that you move your funds elsewhere. Probably to a hardware wallet.
But, you will be perfectly safe storing your Bitcoin on Coinbase. They're a very legitimate company. You can look at it as no different than your bank, really.
So, What Now?
Well, that's up to you. 🙂
You now own some Bitcoin. Even if you consider it to be a small amount, you're already well ahead of most of the world. Because most people don't own any whatsoever.
So, what now? Within a few days, you should get your bonus Bitcoin for starting a new account. If you used my referral link and went through this whole process, you should be getting $15 in free Bitcoin to add to your balance.
From here, you may want to consider Daily cost averaging is a common strategy of buying a small amount of crypto (often Bitcoin) every single day - automati... Click for full definition. Or, perhaps weekly. It basically means that you set up a recurring transaction to purchase some amount of Bitcoin automatically on a schedule (daily, weekly, monthly). You can set that up with Coinbase, too. You can look at this as a form of savings account... and it blows the snot out of your bank. 🙂
You can also begin to learn about the other coins and cryptos, if you wish. Just remember:
- I don't recommend you invest anything without researching it yourself first. Know what you're doing. Don't chase things just because you think the price is going up. Don't get greedy.
- Don't freak out if the price of your Bitcoin drops. Seriously. It happens. In the long run, it won't matter. Your best strategy is to just... hold it. Forget about it. Let time do the work.
OK! If you have any questions, feel free to ask below.