The cryptocurrency market has been booming over the past few years, with over 10,000 cryptos in existence, as of November 2022. Bitcoin, the most well-known of the cryptos, has grown by leaps and bounds, piquing the interest of new investors. If you’re new to the world of crypto and are wondering where’s the best place to buy Bitcoin, this guide has everything to help you get started on the right foot. You’ll also learn how to store your Bitcoin safely.
Where to Buy Bitcoin
You can buy Bitcoin online through a crypto exchange. But with so many exchanges, it can be difficult to pick the right one. We’ve rounded up the top three best exchanges to buy Bitcoin:
|Minimum Deposit||0.0001 BTC||0.0001 BTC||$2|
|Transaction Fees||0.9% for buying stablecoins and 1.5% for other coins||$0||0.60% taker fee and 0.40% maker fee|
|Staking and Rewards||Yes||Yes||No|
|Trading fees||0.9% for stablecoins and 1.5% for other coins|
Kraken is one of the most established crypto exchanges on the market. To buy Bitcoin on Kraken, create an account and connect a funding method. With as little as $10, you can buy Bitcoin and store it in a digital wallet.
- Relatively low Bitcoin withdrawal fees
- Advanced features like margin trading and staking
- Offers a wide range of educational materials
- Not available across all states
- Limited funding options
- May not be ideal for beginners
Read our full Kraken review.
|Trade minimums||0.001 BTC|
Binance lets you buy Bitcoin through its website or app. The signup process is seamless, meaning you can purchase your digital assets in minutes. You can buy Bitcoin using a credit or debit card, bank deposit, or P2P trading. You also can store your BTC in your personal crypto wallet or hold it in your Binance account.
- Low trading fees
- Broad selection of order types and trading options
- Multiple payment options
- Not available in all states
- Not user-friendly for beginners
- No built-in digital wallet
Read our full Binance review.
|Trading fees||0.60% taker fee and 0.40% maker fee|
Coinbase makes it simple to buy, sell, and hold Bitcoin. Once you have an approved Coinbase account, you can fund it and purchase however much Bitcoin you wish. The intuitive interface makes it easy for beginners to invest in digital assets.
- Easy to use for crypto beginners
- Low trade minimums
- Low fees for the Pro version
- Higher trading fees than other exchanges
- Cannot stake Bitcoin
Read our full Coinbase review.
How to Buy Bitcoin
If you want to buy Bitcoin, there are several ways to own the most popular digital asset. Here are five common ways to buy Bitcoin and the benefits of using each.
- Credit Cards: It’s possible to buy Bitcoin using a credit card as long as your credit card issuer and crypto exchange allows it. This means you can buy crypto even when you don’t have cash. However, transaction fees can be very expensive because it is often considered a cash advance.
- Debit Cards: Like credit cards, you can buy Bitcoin with a debit card. As long as your card has sufficient cash, you can link it to your crypto exchange, and you’re good to go. Transaction fees for debit cards are lower than for credit cards.
- ACH: If you’ve ever used your bank account to pay a bill online, you’ve used ACH (Automated Clearing House). You can use this same online banking system to buy Bitcoin. This option is perfect for you if you plan to purchase crypto in large quantities. One downside of using ACH is that banks may limit the amount you can send or the number of transactions you can make each month.
- PayPal: You can buy Bitcoin through PayPal’s website or app. Provided that you have a PayPal account, you can purchase digital assets on the go.
- Bitcoin ATMs: Another option is a Bitcoin ATM. A Bitcoin ATM allows you to buy and sell cryptocurrencies using cash or a debit card. However, you may need a Bitcoin wallet to make a transaction. In addition, transaction fees can be high.
How to Buy Bitcoin with a Credit Card
Here’s a step-by-step guide on how to buy Bitcoin with a credit card on Kraken.
Step 1: Log in to your Kraken account and select Bitcoin.
Step 2: Enter the amount you wish to spend and pay with your credit card.
How to Buy Bitcoin with a Debit Card
Here are the steps to buy Bitcoin with a debit card on Binance.
Step 1: Log in to your Binance account and go to "Buy Crypto", and choose credit/debit card.
Step 3: Enter your debit card information and click “pay now.”
How to Buy Bitcoin with PayPal.
You can buy Bitcoin directly through the PayPal website or app. You can also use PayPal to fund your crypto exchange account. Here’s how to buy Bitcoin with PayPal on Coinbase.
Step 1: Log in to your Coinbase account.
Step 2: Add a payment method to link PayPal to your account.
Step 3: Enter the amount of Bitcoin you want to buy and then pay.
When to Buy Bitcoin
Bitcoin is a highly volatile digital asset, so knowing the right time to buy can be difficult. As investors like to say: “buy low, sell high." Looking at past market cycles may give you an idea of future market expectations.
The growth of Bitcoin adoption started way back in 2009 when its price was barely above zero. In February 2011, Bitcoin’s price hit $1 for the first time. Two years later, the price surged to $1,100, and in 2017, the price soared to nearly $20,000. Since then, Bitcoin has continued to move toward mainstream adoption, and in November 2021, it reached an all-time high of $68,500. But Bitcoin's price has fallen amid the inflation of 2022, to below $16,000.
As you can see, the price can vary wildly. It's important to pay attention not only to the market for Bitcoin, but also to the markets overall.
Consider Dollar-Cost Averaging
Dollar-cost averaging (DCA) is an investing strategy where you invest a fixed dollar amount at regular intervals, such as daily, weekly, biweekly, or monthly. The strategy is ideal for investors who succumb to emotions such as "fear of missing out" (FOMO). Dollar-cost averaging with Bitcoin has several notable benefits:
- Lowers investment risk
- Prevents market timing
- Helps take emotion out of investing
As with any investment strategy, DCA has downsides too:
- High transaction costs due to regular investing
- Low expected returns because you’re holding onto money as cash for longer
Where to Store BTC
The same way you keep your cash or credit cards in a physical wallet, you can store Bitcoin in a digital wallet. A digital wallet can either be "cold" or "hot." Read on to find out which one is the safest to store BTC.
|Hot Wallets||Cold Wallets|
|Best for||Short-term storage||Long-term storage|
|Maximum number of currencies||One to tens of thousands of cryptocurrencies||1,000 to tens of thousands of cryptocurrencies|
|Security||Average because they’re vulnerable to attacks||Excellent since private keys can’t be accessed online|
|Loss protection||Recovery and backup options are available, and can be accessed on multiple devices||Recovery and backup options are available for lost password but not a lost device|
|Ease of transfer to exchanges||Very easy to transfer digital assets, provided there’s an internet connection||Transferring digital assets on cold wallets requires an extra step, such as plugging into a USB, scanning a QR code or connecting online using the internet|
|Price||Free, but some charge interest on stored crypto||You must buy an external storage device|
A hot wallet is a virtual cryptocurrency wallet held online that allows you to store, send, and receive cryptocurrencies. You can access a hot wallet on devices such as phones, tablets, and computers, provided there’s an internet connection.
While hot wallet wallets allow you to access your digital assets anywhere, they’re vulnerable to malware attacks. For this reason, hot wallets are ideal for storing small amounts of digital assets. Here are the top three hot storage wallets:
- Ease of use
- Instant access
- Low cost
- Limited storage
- Prone to malware attacks
Cold Storage Wallets
In contrast to hot wallets, cold storage wallets are not connected to the internet. Instead, digital assets are kept in a hardware device, adding an extra security layer from potential attacks. Here are the top three cold storage wallets:
- Less vulnerable to online attacks
- Easy to recover crypto assets
- Transfers between cold storage devices can be cumbersome
To Sum It Up
You can buy Bitcoin through crypto exchanges like Coinbase, Binance, and Kraken or cash apps like PayPal and Venmo. To buy the digital asset on an exchange, you must register and fund your account. Keep in mind that the transaction fees and trade minimums vary by exchange. Once you’ve purchased your Bitcoin, ensure you store it in a digital wallet to safeguard your private key.
Frequently Asked Questions
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