Hey, welcome! Yes you. You’ve probably heard about the incredible bull run Bitcoin has experienced in the past twelve months, or perhaps that big companies around the world are now putting their reserves into Bitcoin. Either way, for whatever reason you want to buy BTC it’s great to have you here, welcome to the club. Today we’re going to show you how to buy Bitcoin for the first time.
What Is Bitcoin?
A very good place to start. We’re going to keep it relatively simple here, but if you’re looking for some more in depth insights check out our What Is Bitcoin blog. So, briefly, Bitcoin is a peer-to-peer payment system that was designed to be completely decentralized. This means that it is not controlled by any government, bank or corporation, instead it is operated and maintained by a network of nodes (computers) that follow a certain set of rules. Bitcoin cuts out the middleman and allows for fast and cheap transactions between one individual and another. Revolutionizing the way money is sent across borders, cryptocurrencies have filled a much needed gap in the financial market.
A Brief History Of Bitcoin
Bitcoin was first announced in 2008 in a whitepaper released by the mysterious Satoshi Nakamoto. To this day his identity remains a mystery, however his legacy will go down in the history books. Nakamoto then created a BitcoinTalk forum (still active today) and registered the Bitcoin.org domain (also still active today). In early January of 2009 the genesis block (the first block of any blockchain) was mined and Bitcoin officially entered the world.
Just over a decade later and Bitcoin sparked a $1 trillion industry, counting over 8,000 altcoins. In the industry, any cryptocurrency that is not Bitcoin is referred to as an altcoin. Bitcoin has continued to defy the odds when it hit a new all time high in early January 2021, reaching over $40,000 for 1 BTC. The original cryptocurrency continues to dominate the crypto market accounting for over 60% of its entire value. No wonder so many institutional investors are taking notice, and action.
What To Know When Buying Bitcoin
The first and arguably most important thing to know is that Bitcoin is divisible by up to 8 decimal places. Owning Bitcoin does not mean shelling out over $30,000 for 1 BTC, owning Bitcoin can also include owning 0.003 BTC. The cryptocurrency was designed to be incredibly versatile in its payment service, and therefore was designed to be broken down into the smallest fraction. The smallest denomination of Bitcoin is called a Satoshi, and equates to 0.00000001 BTC. You might have heard of a Satoshi Millionaire, this is when someone owns a million Satoshis, 0.01 BTC. The breakdown goes as follows:
0.00000001 BTC = 1 Satoshi
0.00000010 BTC = 10 Satoshi
0.00000100 BTC = 100 Satoshi
0.00001000 BTC = 1,000 Satoshi
0.00010000 BTC = 10,000 Satoshi
0.00100000 BTC = 100,000 Satoshi
0.01000000 BTC = 1,000,000 Satoshi
0.10000000 BTC = 10,000,000 Satoshi
1.00000000 BTC = 100,000,000 Satoshi
This enables people to use Bitcoin for everything from buying groceries, to buying a plane to micro tipping.
How To Buy Bitcoin For The First Time
It’s time. Let’s do this. In this day and age buying Bitcoin is a walk in the park, so you have nothing to be afraid of. The process is generally simple and secure, depending where you decide to buy BTC. Here are some basic need to knows.
- Pick a reliable platform.
Read the reviews, check the credentials, and always do your research before parting ways with your money. Many platforms allow you to buy BTC with a debit or credit card, as well as through bank transfer. For your first time we’d advise not getting in too deep with a peer to peer exchange.
- Check the fees.
Platforms often have hidden costs, so make sure you’re aware of all the hidden costs when engaging on a new platform. When buying Bitcoin you will be required to pay a network fee, this is standard across the board, however sometimes platforms incorporate other fees for using their service, so best check this out before diving in.
- Look for a good price.
Ensure that you are buying Bitcoin at a reasonable price by comparing it against Coin Market Cap (the godfather of crypto prices). It’s normal for an exchange to slightly inflate the price, but don’t accept anything too wild.
- Open A Bitcoin Wallet.
In order to buy BTC, you’re going to need to find a reliable Bitcoin wallet. These days getting your hand on one is as easy as 1,2,3. There are several different types of wallets, find one best suited to your needs. Most exchanges offer a wallet service, using this will be just fine.
- Get Ready For KYC.
Any reputable platform will require you to complete a simple KYC. This stands for Know Your Customer and is a requirement in order to adhere to anti money laundering regulations. It is good for both you and the platform, so if you’ve found one that doesn’t require any KYC verification – run. In the KYC process you’ll be asked for your name, address and country of residence. You will also be asked to provide a valid ID, be it through a passport, utility bill or government issued ID. It is very likely, depending on the platform you chose, that you will also be required to submit a selfie of you holding said ID document. This might feel tiresome, however it is imperative, trust us.
- Make your first purchase.
Follow the instructions and buy Bitcoin for the first time on the platform of your choice. Nine times out of ten the platform will have an intuitive interface that will guide you through the process. They’re also likely to have a handy customer support representative on standby should you need any help. At this stage all you’ll need is the payment method of your choice and your Bitcoin wallet address.
Congratulations And Welcome To The Club
If all went well, and it should have, you’re now the successful owner of some BTC. This guide on how to buy Bitcoin for the first time hopefully eased you into the market with confidence, look at you go! Whether you decide to hodl, use it for everyday shopping, or buy more, you’re now the proud owner of the next generation of money.