At present, Bitcoin has become a buzz word: the more recognizable it becomes, the more people take interest in it. The issue is that Bitcoin is different from the conventional form of money, so newcomers find it really hard to come up with how to acquire some. That’s why, before taking any actions, it is important to understand clearly what cryptocurrency is, how to buy it, what factors are the most important when buying it and, eventually, get to know the safest place and way to buy Bitcoin.
An introduction to Bitcoin and the notion of cryptocurrency
Bitcoin is the first-ever cryptocurrency. Still, it is the most popular, has the highest price per one token and holds the largest market cap.
But what is cryptocurrency? You can think of it as ‘digital money.’ As it entirely exists in the digital world, it is more appropriate to call it a digital currency. The backbone of cryptocurrency is a decentralized network called blockchain, where transactions occur. Besides, it is a peer-to-peer network, meaning that everyone interacts with each other directly.
What affects the price of Bitcoin?
Bitcoin is not a national currency. Its price is not estimated by government like that of the US dollar or EU euro. As Bitcoin is independent, its rate is affected by two universal factors: demand and supply. It is very similar to the way gold ‘works’ with the only difference that everything is done in a digital form.
This is the reason for Bitcoin’s deflationary nature. Its skyrocketing performance is driven by a continuously increasing demand on the market. That’s why many investors stick to a ‘hassle-free’ strategy: Buy and Hold. In this way, Bitcoin can very often become a perfect tool for fringe earnings.
Where are Bitcoins bought?
It depends on how much cryptocurrency sphere is developed in the country you live. For example, Bitcoin ATMs provide quite a simple way to buy Bitcoins; however, they are only available in certain countries and relatively limited amount.
So far, the most widespread option for most people is buying Bitcoins via cryptocurrency exchanges. It’s pretty simple. Just like any regular website, the exchange implies you to make an account, choose the payment option and that’s it — you are ready to buy Bitcoins or any other cryptocurrencies available on the platform.
What are the payment options?
As cryptocurrency is a brand-new concept, many people find it hard to get the idea of how specifically it is bought. Different exchanges include various options for buying cryptocurrency. Let’s take CEX.IO as an example. In far 2013, it was a cloud mining provider; then, it launched Bitcoin and Ether trading. Now, CEX.IO has extended to a worldwide cryptocurrency exchange with an over-million customer base, where you can trade, buy and sell Bitcoin, as well as other popular cryptocurrencies.
Using this kind of exchange, you can buy Bitcoins with fiat money. For example, CEX.IO supports USD, EUR, and GBP. You can fund the account using three basic payment methods:
- Visa/MasterCard. Single time linking and verification of your credit card is the only thing it requires from you. After that, you can buy/sell cryptocurrency in one click.
- Wire transfer. It’s a fee-free option for funding your account by means of electronic money transfer.
- CryptoCapital. Yet, one opportunity to deposit money for free. But, before trying out any payment options, better examine the limits and commissions of an exchange.
Once you’ve funded your account — you are ready to acquire some Bitcoins. Most exchanges offer trading platforms which are perfect for experienced users; if you’re not, you can use the buy/sell section, in this way, you acquire Bitcoins instantly. It is much easier for novice users. Although, be sure to know that not all exchanges include this option.
What to pay attention to when choosing a cryptocurrency exchange?
Now, we’ve moved to the most important part. In the light of the article title, you can see that safety is the name of the game, and no one will argue with that. Before choosing an exchange, it is recommended to check it for different factors, most of which focus on the security issue, in particular:
- Legal and security documents. The thing is that cryptocurrency exchanges are at the intersection of fiat money and cryptocurrency. So, it is vital that exchanges have both certificates and licenses proving the legality of acts for the banking part of the process and certificates or registrations that prove the safeness of transactions occurring on the blockchain side.
- For how long the exchange is operating. It doesn’t mean that the new ones are less reliable. But, still, it is a lot easier to trust an exchange that is on the scene for a definite period. In this case, you know whether it owns a certain creditworthiness or not.
- Get to know whether the exchange was or wasn’t disrupted by hackers. For certain, there is hardly any platform that has never been attacked by hackers. So, if an exchange has never been subject to theft, it can only mean that its security was always at a high level to protect users’ money. And that is a great significative.
- User-friendliness matters, because it is what users are dealing with directly. While the sphere of cryptocurrency is completely new to most people, it is extremely important to grant clients with a plain interface that’s easy to grasp with.
The sphere of cryptocurrency is expanding and developing against the clock. Correspondingly, there’s a vast variety of options for buying Bitcoins. Of course, there is no universal safest place, and everything is relative. That’s why each of us chooses on his/her own. The most important is to find the place that fits you best, but only provided that you regard it as a trustworthy service with reputable history and strong security.