Rise or fall, people just can’t stop talking about Bitcoin. Let’s be clear: We’re not recommending you purchase Bitcoin. But, if you have your heart set on it, here’s how to do it easily—without getting scammed.
Warning: Be Responsible
In our opinion, speculating on Bitcoin (also known as BTC) is basically the same thing as gambling. It’s not a currency people are using in the real world. It’s an unsafe investment that may go up or down. Even if a cryptocurrency ends up taking over the world in the future, there’s no guarantee that the cryptocurrency of choice will be Bitcoin.
Of course, what you do with your money is your own decision. And, if you do want to buy Bitcoin, we’re here to show you the best, easiest way to get started.
If you do want to invest in Bitcoin or another cryptocurrency, be sure to do it with money you can afford to lose. Go in knowing that your investment may never pay off and you may lose all your money. It’s a risky asset.
Just take a look at Bitcoin’s historical value. Will it go back up, or will it continue sliding? Anyone who says they know for sure is lying to you, because no one can see the future.
How to Buy Bitcoin Without Getting Ripped Off
We recommend you use Coinbase if you want to get started buying Bitcoin or another digital currency. Coinbase is a digital currency exchange website headquartered in San Francisco. It’s user-friendly and is a US-based company. It’s a more trustworthy company than some of the fly-by-night Bitcoin sellers you sometimes see advertised on the web. While it’s based in the USA, Coinbase allows people from many different countries to buy and sell Bitcoin.
Coinbase lets you buy and sell Bitcoin, and it also provides a digital wallet that holds the Bitcoin you purchase. You can transfer any Bitcoin you purchase from Coinbase to your own private wallet at any time, if you like. However, by default, the Bitcoin you buy at Coinbase is stored in a wallet tied to your Coinbase account, which you can view on the Coinbase website or in the Coinbase app—simple.
To get started, head to the Coinbase website on your computer or download the Coinbase app for iPhone or Android. You’ll need to click the “Sign Up” button and create an account. During the account creation process, you’ll be asked for your name, date of birth, address, occupation, employer, and the last for digits of your social security number. This is the result of “Know Your Customer” laws in the USA.
You’ll end up at the Coinbase dashboard, which shows the current and historical price of Bitcoin—as well as altcoins like Bitcoin Cash, Ethereum, and Litecoin.
To buy Bitcoin, click the “Buy/Sell” tab at the top of the dashboard page. In the Coinbase app for iPhone or Android, head to Accounts > BTC Wallet > Buy, instead.
You need to add a payment method to purchase Bitcoin. Coinbase no longer supports credit cards, so you can’t use those. However, you can use a debit card linked to your bank account for small, instant purchases. Initially, Coinbase allowed us to purchase up to $300 of Bitcoin per week with a debit card. Note, though, that Coinbase charges a fee for debit card purchases.
You can also add a bank account to transfer money via ACH. This takes a few days, but you’ll be able to transfer larger amounts of money into Coinbase. You’ll have to add a bank account if you ever want to sell your Bitcoin and transfer money out of Coinbase. Initially, Coinbase allowed us to purchase up to $7500 of Bitcoin per week with a bank account. Coinbase charges no fee for purchases made via ACH transfer from a linked bank account.
Coinbase also supports wire transfers. These allow you to wire large amounts of money directly into your Coinbase account.
You may be prompted to upload a copy of a photo ID like a driver’s license when you add a payment method. Coinbase lets you do this via your PC’s webcam or your phone’s camera. Again, this is part of the USA’s “Know Your Customer” laws, which demand financial institutions keep track of their customers’ identities. This information is used to go after money launderers, for example. Our identity verification was nearly instant.
When you’ve added a payment method, you can use the Buy/Sell tab to purchase cryptocurrency using any payment method. The interface looks similar on a mobile phone.
To buy Bitcoin, select Bitcoin, select the payment method you want to use, enter the amount of dollars (or other currency) you want to spend on Bitcoin, and then click the “Buy” button at the bottom of the page.
The interface looks a little different in the smartphone app, but the process is the same.
You’re shown a detailed summary of the transaction, including any fees that may be involved—like the debit card purchase fee—and the exact amount of Bitcoin you’re buying. Click “Confirm Buy” and the transaction will go through.
Our $100 transaction was pending for only a second or two, and our bank didn’t even contact us. If your bank is more skittish or you make a larger transaction, your bank’s fraud prevention department may contact you to confirm the transaction before allowing it to go through.
Your Bitcoin is shown under the “Your Portfolio” section on the main Coinbase dashboard page or under “Accounts” in the smartphone app.
If you want to sell your Bitcoin in the future, switch over to the Buy/Sell tab again, and then use the interface to sell your Bitcoin for USD and transfer it to a connected bank account. In the smartphone app, head to Accounts > BTC Wallet > Sell, instead.
How to Boost Your Coinbase Account’s Security
When you sign up for Coinbase and provide a phone number, that phone number is used as a two-step authentication method. Coinbase sends verification codes to your phone number whenever you try to sign in. However, SMS isn’t the most secure two-factor authentication system.
You can also enable two-step authentication using an app like Authy instead. To get started with app-based two-step authentication, click your name at the top of the Coinbase dashboard web page and select Settings > Security > Enable Authenticator
Image Credit: Wit Olszewski/Shutterstock.com.