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What is the safest way to buy bitcoin?

safest way to buy bitcoin

February 12, 2021 | 

JOHN K MWANIKI |  0 Comments| 

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Get Into Cryptocurrency Trading Today

Over the years, bitcoin has received unprecedented hype and unfathomable interest globally. More people continue to show interest in learning about cryptocurrency and the safest way to buy bitcoin. But, there are many cases of bitcoin scams that are rampant in the crypto world. Many new Bitcoin investors have lost tons of money in these scams due to a lack of knowledge. 

This article will discuss how to trade bitcoin and the safest possible ways to buy bitcoin. Without further ado, let us delve into this article.

What do you need before knowing the safest way to buy bitcoin?

Before diving into the safest way to buy bitcoin, there are several things a new bitcoin investor needs to have. Some of the things you need to have before you learn the safest way to buy bitcoin include:

Get the best bitcoin wallet for you

You need a bitcoin wallet to conduct transactions in the cryptocurrency world. Although bitcoins are not a tangible currency, technically, they cannot be stored in a wallet. A bitcoin wallet is a digital wallet that consists of a public and private key. 

A public key handles bitcoin deposits and withdrawals. It is often referred to as the user's digital signature since it appears on the blockchain ledger. Alternatively, the private key handles the buying, selling, and storing of bitcoin in the wallet. 

Users should safeguard their private keys since they authorize bitcoin transactions. They can either opt for cold storage options, like storing the wallet offline or encrypt the wallet with a strong password. 

Due to varying security levels, there are different types of bitcoin wallets. For instance, mobile and online wallets, like Coinbase, are the most popular among casual bitcoin buyers. These wallets are easy-to-access and very secure. Other types of bitcoin wallets include software and hardware wallets and paper wallets.

Gather your personal documents

When registering for digital wallets, the U.S. Securities and Exchange Commission requires investors to show proof of identification. As part of its Anti-Money Laundering policy, users need several personal documents to trade bitcoin. Some of these documents include your Social Security Number (SSN) and your driving license. 

An active credit card, debit card, or bank account

Upon establishing your bitcoin wallet, you can now use traditional payment methods. These include a bank transfer, credit card, or debit card to buy bitcoins on a bitcoin exchange. Once you buy bitcoins, they go to your wallet, and you can use them for trading.

Depending on your locality and exchange, some payment forms are better than others. For instance, debit and credit cards need more identification than bank transfers when purchasing bitcoin. But, bank transfers tend to take longer than credit or debit card transactions. They also have lower transaction fees than other payment methods.

Establish a secure internet connection

With online attacks from hackers on the rise in the cryptocurrency world, you must establish a secure internet connection when trading online. Use discretion when accessing your bitcoin wallet. Do not trade bitcoin on a public or insecure Wi-Fi network.

Choose a cryptocurrency exchange

Once you follow all the steps mentioned above, you can now choose the safest way to buy bitcoin. Traders buy Bitcoin and other cryptocurrencies from online platforms referred to as exchanges. These exchanges connect you directly to the bitcoin marketplace. In turn, you can exchange fiat currency for crypto easily.

There are many reputable exchanges in the crypto world with high-level security and reporting standards. Let us look at three of the safest ways to buy bitcoin.

Bitcoin ATMs

Like depositing money into a bank ATM, bitcoin ATMs are fast, easy, and very convenient to use. They provide a physical store where users can trade their fiat currency for digital currency. But, you have to be near one of these machines for a successful bitcoin transaction. 

Luckily, mobile applications, like Coinatmradar, offer detailed information about bitcoin ATMs near you. Users have to put in their locations and the type of digital currency they wish to buy/sell. In turn, the application will find a bitcoin ATM located near you.

Find a secure and easy to use exchange platform

Another safe way to buy bitcoin is through a reputable exchange platform. Although there are many exchange platforms, many of them consist of hackers and scammers. Thus, you must ensure that you choose a secure exchange since they hold your crypto as you trade. It is best to opt for one that allows its investors to withdraw their crypto into their personal wallet for added security. 

Some examples of well-known exchanges include Kraken, Gemini, Coinbase, and Binance. Each of these exchanges has its advantages and disadvantages. So, it is best to conduct thorough research before choosing one. 

Peer-to-peer exchanges are one of the safest ways to buy bitcoin

Unlike exchange platforms that anonymously connect a buyer and seller, a peer-to-peer exchange platform allows a more direct connection. Users can see who exactly they are trading with and view the history of trades on the platform. Both parties facilitate all their transactions, unlike in an exchange. 

LocalBitcoins is one of the most popular peer-to-peer exchanges. Upon creating an account, users can post requests to buy or sell bitcoins. Other users then browse through the offers and choose the trading partners they wish to transact with.

With peer-to-peer exchanges, users can shop around for the best deal that fits their budget. The platform also features a rating system. With this system in place, users receive an evaluation after trading on the forum. This helps either party to have a clue with whom they are transacting.

Conclusion

When looking for the safest way to buy bitcoin, security, reliability, and convenience are key considerations. The cryptocurrency world has a rising number of scammers and fraudsters on the loose. Buyers should always practice vigilance and caution when buying bitcoin. They should always ensure they are buying from a credible source. 

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