How to buy your first Bitcoins — Beginners Guide
Investing in Bitcoin seems like a difficult challenge first, but following my step by step guide will make your start of the crypto adventures easy. Buying Bitcoin is getting easier by the day and the legitimacy of the exchanges and wallets is growing as well.
You will need
- Cryptocurrency Exchange Account
- Personal Identification Documents for a KYC platform(Know Your Costumer)
- Secure Connection to the Internet
- Method of Payment — Bank Account, Debit Card, Credit Card or Paypal.
- Personal Crypto Wallet outside of the Exchange — Exodus Wallet or Ledger Wallet
Cryptocurrency Exchange Account
Signing up for a cryptocurrency exchange will allow you to buy, sell, and hold cryptocurrency. It is generally best practice to use an exchange that allows its users to also withdrawal their crypto to their own personal online wallet for safer keeping.
- Coinbase
Coinbase started in 2012 with the radical idea that anyone, anywhere, should be able to easily and securely send and receive Bitcoin. Today, they offer a trusted and easy-to-use platform for accessing the broader cryptoeconomy.
Approximately 56 million verified users, 8,000 institutions, and 134,000 ecosystem partners in over 100 countries trust Coinbase to easily and securely invest, spend, save, earn, and use crypto.
Sign up now and get £7.09 or 10 USD of free Bitcoin when you buy or sell at least £70.9 of digital currency. Claim your invite now: https://www.coinbase.com/join/gal_tz?src=android-share
2. Swissborg
SwissBorg is a Switzerland-based project aiming to bring independence and decentralization to personal finance. Launched in 2017, SwissBorg aims to revolutionize Swiss private banking and employ the power of blockchain technology and smart contracts to create a decentralized network for personal finance.
SwissBorg relies on its multi-utility CHSB token to allow users to perform a plethora of actions on the network. The project aims to create a democratic, decentralized and professional ecosystem, enabling users to manage their crypto portfolios with ease. SwissBorg’s creators also launched the SwissBorg Wealth App, which further optimizes the management of personal finances. The app uses revolutionary MPC keyless technology to allow users to exchange between fiat and crypto in a matter of seconds.
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3. Binance
Launched in July 2017, Binance is one of the biggest cryptocurrency exchanges globally. By aiming to bring cryptocurrency exchanges to the forefront of financial activity globally. The idea behind Binance’s name is to show this new paradigm in global finance — Binary Finance, or Binance.
Aside from being the largest cryptocurrency exchange globally, Binance has launched a whole ecosystem of functionalities for its users. The Binance network includes the Binance Chain, Academy, Trusted Wallet and Research projects, which all employ the powers of blockchain technology to bring new-age finance to the world. Binance Coin is an integral part of the successful functioning of many of the Binance sub-projects.
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What is the process of a KYC?
In the context of cryptocurrency, most exchanges will require you to go through a crypto KYC process before buying and cashing out your Bitcoin or other cryptocurrencies. The process of doing so is pretty straightforward.
- You will need to provide your full name, residential address, and phone number. This will ensure that you will pass the initial stages of the verification.
- Then you may be asked to provide a copy of your legal documents, such as an ID or a passport. Exchanges will request not only a photograph of the official document but also a selfie with you holding the document, to verify that the document belongs to you.
- Finally, a few cryptocurrency exchanges may even go as far as asking information about your occupation, a utility bill and official proof of address.
Method of Payment
After the exchange has ensured your identity and legitimacy you may now connect a payment option. At most exchanges, you can connect your bank account directly or you can connect a debit or credit card. While you can use a credit card to purchase cryptocurrency, it is generally something that should be avoided due to the volatility that cryptocurrencies can experience.
There are varying fees for deposits via a bank account, debit, or credit card. Coinbase is a solid exchange for beginners and has a 1.49% fee for bank accounts, with a 3.99% fee for debit and credit cards. It is important to research the fees associated with each payment option to help choose an exchange or to choose which payment option works best for you.
Exchanges also charge fees per transaction. This fee can either be a flat fee (if the trading amount is low) or a percentage of trading amount. Credit cards incur a processing fee in addition to the transaction fees.
Buying your first Bitcoin
After completing all the necessary verifications, there is nothing else left to buy your cryptos. In the recent years all the exchanges made their platform as user friendly as possible and most of the time the process is very straight forward.
NOTE! A whole Bitcoin is 40000USD at the moment, but the exchanges let you buy small parts of Bitcoin (Satoshis) as well.
Safe Storage
Bitcoin and cryptocurrency wallets are a place to store digital assets more securely. Having your crypto outside of the exchange and in your personal wallet ensures that only you have control over the private key to your funds. It also gives you the ability to store funds away from an exchange and avoid the risk of your exchange getting hacked and losing your funds.
While most exchanges offer wallets for their users, security is not their primary business. We generally do not recommend using an exchange wallet for large or long-term cryptocurrency holdings.
When it comes to choosing a Bitcoin wallet, you have a number of options. The first thing that you will need to understand about crypto wallets is the concept of Hot wallets(online wallets like Exodus, Metamask) and cold wallets (paper or hardware wallets like Ledger).
Hot Wallets
Online wallets are also known as “hot” wallets. Hot wallets are wallets that run on internet-connected devices like computers, phones, or tablets. This can create vulnerability because these wallets generate the private keys to your coins on these internet-connected devices. While a hot wallet can be very convenient in the way you are able to access and make transactions with your assets quickly, storing your private key on an internet-connected device makes it more susceptible to a hack.
Cold Wallets
The simplest description of a cold wallet is a wallet that is not connected to the internet and therefore stands at a far lesser risk of being compromised. These wallets can also be referred to as offline wallets or hardware wallets.
These wallets store a user’s private key on something that is not connected to the internet and can come with software that works in parallel so that the user can view their portfolio without putting their private key at risk.
Remember! NOT YOUR KEYS, NOT YOUR CRYPTO!
DISCLAIMER! I am not a financial advisor, none of the above is a financial advice! So Please Do Your Own Research (DYOR)!
