Buying And Storing Bitcoin (BTC): A Beginner’s Guide

Key Takeaways

You can buy, hold, and store Bitcoin (BTC) and cryptocurrencies in several ways!

Bitcoin can be used as a hedge against any currency due to its deflationary and transparent nature.

Make sure you understand why you are investing in Bitcoin in the first place before committing any investment.

Bitcoin is a virtual currency (cryptocurrency) that has captivated technologists and investors alike, who see its disruptive potential. Since only 21 million Bitcoins will ever be “mined” and made, many investors see it as an asset that will face scarcity in the future.

This article will show you some easy ways to buy Bitcoin yourself!

Why Should I Buy Bitcoin?

Bitcoin is an internet-native asset underpinned by blockchain technology, which is a global network of nodes that independently verifies and validates blocks of transactions, which are then added to the ledger. To date, Bitcoin represents the first decentralized, global, and internet-native money that anyone with an internet connection can access, use, and transact with for any reason.

Furthermore, Bitcoin can be used as a hedge against any currency due to its deflationary and transparency. There will only ever be 21 million Bitcoin in its total supply, and the code that runs the software is open-sourced and free for anyone to investigate or run independent tests on.

When compared to centrally issued money and currency, no one knows precisely how many coins and notes are in circulation, which hands they are flowing through, and what the following monetary policy will be issued to move the economy in one way or the other.

To answer the question of why you should buy Bitcoin, it removes the obscure middlemen that impede the free flow of money and currency for goods and services globally.

How Much Bitcoin Should I Buy?

The amount of Bitcoin you should buy depends on three key factors: your budget, your overall investment portfolio, and your reasons for buying.

Bitcoin’s price fluctuates significantly because it depends on what the market thinks it is worth. Additionally, making a quick profit from Bitcoin is risky, especially if you are new to trading. It is more likely you will lose money than multiply your capital.

Before investing in any asset, develop a clear investment thesis. Research and understand the market, then discuss your strategy with a financial advisor experienced in traditional and alternative assets. Once you have a solid foundation and confidence in your approach, gradually increase your holdings.

What To Know When Buying Bitcoin

There are several ways to acquire Bitcoin. You can purchase BTC from those you know have some and are willing to sell or from a business. Additionally, online platforms connect buyers and sellers in this manner. The most popular, however, is a cryptocurrency exchange, which allows buyers and sellers to exchange seamlessly.

There are no restrictions on the amount of Bitcoin you can purchase outside of the exchanges, as long as the seller has the value of Bitcoins you need. Some exchanges restrict the number of Bitcoins you can purchase daily, and buying beyond a particular amount could alert the authorities on your transactions, as most exchanges would require that you identify yourself to make transactions above certain limits.

Whether buying more than one Bitcoin or wanting some fractions of the coin, you will want to protect your investment. To do this, you will need a Bitcoin wallet. Bitcoin wallets are devices/software applications used to make Bitcoin transactions. It is needed to store, send, or receive Bitcoin from others. Here is a good guide for creating your Bitcoin wallet:

We will also discuss the ways of storing your Bitcoin in later sections as well.

Where Should I Buy Bitcoin?

There are several ways to acquire Bitcoin, depending on your location and what is available in your market. For example, the easiest method is via a centralized exchange, where a user can use a bank account or card to make a purchase. In some countries, additional steps must be taken as the banking industry views digital assets negatively. If you are technologically savvy, then using a decentralized exchange (DEX) such as Uniswap or PancakeSwap is much quicker.

In 2017, peer-to-peer trading via the now-defunct LocalBitcoins website was quite popular. Even with the website shut down, people still meet in person and exchange cash for a deposit to the wallet of their choice.

In some countries, some ATMs offer digital assets for sale. Depending on the amount being purchased, an ID may be required. Beyond that, a user can easily use cash to top up their crypto wallet.

Buying Bitcoin On Cryptocurrency Exchanges

There are many cryptocurrency exchanges in the market. Some even allow users to buy Bitcoin with credit cards or through payment methods like P a yPal, Skrill, WebMoney, and WeChat. Each has its features, fee structures, technology, and security protocols. Crypto exchanges also decide which cryptocurrencies to offer and which trading pairs to use.

Most offer instant transactions because of these platforms’ high buying and selling rates. Because these cryptocurrency exchanges offer this service and act as the middlemen of the trade, they will take a small fee from the transaction.

Most traders will use the same platform or two for their trades to ensure ease of use, consistency in their process, and trust that the exchange will carry out their trades promptly. Most traders will tell you not to keep your coins on an exchange and instead store them in a wallet. Still, exchanges have come a long way in protecting traders’ assets.

That said, Bitcoin is widely accessible. You can buy or sell Bitcoin in the UK, US, Australia, Europe, Asia, and many other regions and countries. If you want to find the best crypto exchanges in your region, you can do so by clicking here.

Buying Bitcoin On Bitcoin ATMs

Bitcoin ATMs are a fast and easy method of purchasing Bitcoin. However, they charge transaction fees between 5% and 10%.

Of course, they are found in all sorts of locations, such as convenience stores and gasoline stations, so you must find one to support your wish to secure Bitcoin this way.

Luckily for you, a site called CoinATMRadar tracks all of the Bitcoin ATMs in the world!

Buying Bitcoin On P2P Platforms

Peer-to-Peer (P2P) platforms offer a decentralized way to buy and sell Bitcoin directly between individuals. These platforms act as intermediaries, connecting buyers and sellers who can negotiate terms and prices.

P2P trading usually involves face-to-face or online meetings or escrow services to ensure the safety of transactions. While these provide more flexibility and potentially better rates than traditional exchanges, they may require additional caution and research to avoid scams or risks.

It is worth noting that most P2P platforms for Bitcoin are already integrated into most cryptocurrency exchanges.

Buying Bitcoin On Decentralized Exchanges (DEXs)

One of crypto’s most exciting innovations is the decentralized exchange (DEX). As the name implies, DEXs allow users to buy and trade with each other without depositing their funds with a centralized entity.

The most obvious benefit of a DEX is the same as with any decentralized application: censorship resistance. Any application built on a decentralized blockchain cannot be shut down unless the entire chain is shut down. This is important as many countries have banned or heavily restricted cryptocurrencies.

Decentralized exchanges also require the user to be 100% responsible and control their funds. For some people, this might not be so appealing. Not everyone wants to be in charge of the safety of their assets, but by shouldering the responsibility on your own, your funds are as secure as you want them to be!

Storing Your Bitcoin

If you plan to hold Bitcoin long-term, you must prioritize security by choosing a hardware wallet. A small amount on an exchange might be suitable for easy access if you trade frequently. Depending on your needs, you can even use a combination of hot and cold wallets.

Remember, if you choose a self-custody wallet like a hardware wallet, you manage your private keys, so strong passwords and two-factor authentication (2FA) are very important. Understanding these storage options and security best practices can help you keep your Bitcoin safe.

Final Thoughts

Now, you have a good idea of the various ways of buying and storing Bitcoin and how to become a cryptocurrency owner and investor with a few short steps.

Hundreds of resources are available to buy other cryptocurrencies, use certain exchanges, or download specific wallets. Make sure you research the technology and the risks associated with trading asset classes like cryptocurrencies.

If you liked this article, you might be interested in the following topics: