Cryptocurrencies: 2719 / Markets: 18964 Market Cap: 24h Vol:
2018-11-21 21:17:53

How To Start Investing in Bitcoins – The Beginners Guide

The best time to plant a tree was 20 years ago. The second best time is now.

This advice in an old Chinese proverb is most apt for the users planning to invest in Bitcoins. If you are someone who has heard about Bitcoin, irrespective of when but have never invested in it NOW is the right time.

Bitcoin, a digital decentralized currency based on Blockchain, is going places. Once you know how Bitcoin works, it is a no-brainer to understand that Bitcoin is here to stay. If we try to understand the technology and its underlying principles, it is right to say that the price will keep rising over the years to come.

One of the major reasons for the claim is the finite amount of Bitcoins, making it a great store of value (only 21 millions Bitcoins) and viral adoption around the globe.

If you are ready and excited to purchase Bitcoins, this guide will help you get started with Bitcoin investment. Treat this as a blueprint for Bitcoin investments. Do customize it according to your current financial situation that suits your needs.

Here is what you need to start investing in Bitcoins:

  1. An exchange or website to buy Bitcoins
  2. A wallet where you can store Bitcoins

These two are must-haves to get started with. Under no circumstances should you miss the understanding of the correct website and a safe wallet, or you might fall prey to some MLM (Multi-level Marketing) or scam, resulting in losses.

What you need to understand is Bitcoin is like keeping money with you. Unlike USD, INR or other currencies that you keep in the bank, Bitcoin is different. And you are responsible for buying, selling and securely storing it. I have talked about these in my earlier guide here.

For now, let’s discuss point #1 and #2. In the coming days, I will also talk about the amount of money you should invest in Bitcoin.

What do you need to start investing in Bitcoins?

#1 Exchange from where you can buy Bitcoins:

If you are living in a country where you have an official Bitcoin exchange, you don’t need to worry much about purchasing Bitcoins. You can quickly sign up for these exchanges and transfer money from your bank account to purchase Bitcoins.

Listed below are a few country wise exchanges from where you can buy Bitcoins:

  • USA: CoinBase, Kraken, Gemini
  • India: BitBNS, Koinex
  • UK, Europe: CEX
  • Israel: CoinMama
  • South Korea: Bithumb
  • Russia: Yobit
  • Nigeria: Luno
  • Japan: Coinmama
  • Australia: CoinSpot
  • South Africa: Luno

However, the problem is for people residing in countries where there is no Bitcoin exchange and users have no option of transferring funds from their bank accounts to purchase Bitcoins. This makes it really hard for the users to hold Bitcoins now and with the prices surging at a rapid pace, it might be too late for many to get hold of Bitcoins. But that is where we come to rescue. How you may ask. We have come up with other options through which you can buy Bitcoins.

Below are a few websites from where you can buy Bitcoins in other ways such as:

  • Cash (Risky but works)
  • Using PayPal
  • Payza
  • Payoneer
  • Credit cards
  • Debit cards

Initially, when it was not as easy to purchase Bitcoins in my country, I used a credit card to buy Bitcoins from Cex.io.

This worked pretty well as the Bitcoin price difference between International market and in my country was significant. If you are in a country where you can’t buy Bitcoins directly, you can use these international sites where they accept credit & debit cards.

Here is a list of sites that allows buying Bitcoins using Credit/Debit card:

  • CEX.io
  • CoinMama
  • Bitit

Another method which works for most countries in the world is a P2P exchange. Think of this P2P exchange as eBay where you connect directly with the seller to purchase Bitcoins. These exchanges support various methods of payment such as :

  • Cash
  • Payoneer
  • PayPal
  • Online transfer
  • iTunes Gift card
  • Amazon Gift card
  • Moneygram

…and many other methods.

The one that I have used in the past and recommend is:

  • Localbitcoins

You can read this guide to learn from my experience of using Localbitcoins to purchase Bitcoins. There are also a few lesser known methods such as using Amazon gift card & Purse.io to get hold of Bitcoins.

As we discover new working methods, we will keep sharing it on CoinSutra. For now, what’s important is that you need to pick an exchange/website from where you can buy Bitcoins on a regular basis. This will take care of our #1.

Note: If you are in a country where you have no option to buy Bitcoins, do let us know in the comment section below. We will do our best to find a solution for you.

#2 Keeping/Storing your Bitcoin in a secure wallet:

To store Bitcoins, you need a wallet. If you search online for Bitcoin wallets, you will get plenty of options but you need to be careful with choosing the right one. With many wallets being fraud, you will end up losing your Bitcoins. Just search on Google play store for Bitcoin wallet and you will be shocked to see the number of results.

This is a big mistake to pick any random Bitcoin wallet just because it’s listed on the Google play store or that it is on the first page of Google. As Bitcoin prices are rising, the number of scams are also increasing.

Another big mistake that even experienced users make is by keeping the wallet in an exchange. Most of the exchanges like Localbitcoins, CEX, CoinBase, Koinex, ZebPay, and numerous others offer in-built Bitcoin wallet and lets you store Bitcoins in their wallet. The problem with holding Bitcoins in an exchange is if you don’t own the Bitcoins.

Since very few countries in the world are working on regulation of Bitcoin and Cryptocurrency in general, these exchanges can be shut down. This happened in China sometime in September 2017. Exchanges are also at risk of getting hacked and you might lose your Bitcoin if you store it on an exchange. You can read about the biggest Bitcoin hacks here.

As I mentioned earlier, Bitcoin is not like a typical currency that you keep in your bank. You are responsible for the security of your Bitcoins and that’s why you keep it in a wallet that you have 100% control over. This is done by having the ownership of seed word or private key.  For the first timer, it may sound very technical, but it is actually easy to understand and learn.

To simplify your understanding of Bitcoin wallet security, you just need to use a well-recognized wallet that lets you, and only you, keep the seed words. This seed word is the password for your Bitcoin. Even if you lose your phone or hardware wallet, you can recover your Bitcoin using the seed words.

We have a few dedicated resources for understanding this.

News appeared first on: Coinsutra.com