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Investing in Bitcoin (BTCUSD) may appear complex, but it's much simpler when you breakdown the process into smaller steps. If you are interested in investing or trading Bitcoin just requires an account at a provider or exchange, however more secure storage practices are suggested.There are several items that prospective Bitcoin investors should have such as a cryptocurrency exchange account, personal identification documents when you use a Know Your Customer (KYC) platform that has a secure connection the Internet as well as a method of payment. It is also suggested to have your own private wallet separate from the exchange account. The most reliable methods to pay using the method of bank accounts along with debit cards and credit cards. It is also possible to take bitcoin at ATMs that specialize in bitcoin as well as via P2P swaps.KEY TAKEAWAYS"The value" of Bitcoin comes from its usage as a store of value and payment method and also its limited supply and decreasing inflation.* While it's virtually impossible to for Bitcoin to be compromised, it is possible for your exchange or wallet access to your account be altered. This is the reason proper storage and security precautions is imperative.You can also purchase bitcoin via mainstream services like PayPal? as well as Robinhood.One way to get bitcoin is to invest into companies with bitcoin in their balance financial statements.Before You Buy BitcoinSecurity? and privacy are crucial security and privacy concerns when it comes to Bitcoin investors. Anyone who gets the private access to a public-facing address on the Bitcoin blockchain can be authorized to make transactions.1 Private keys must be kept private as criminals could attempt to steal them when they find out about large assets. It is important to be aware that anyone can examine the balance of a public account you've used. The downside to these public records is that it allows an individual to create multiple public addresses to themselves. This means they can spread their wealth of Bitcoin over multiple addresses. A great strategy is to protect investments that are significant at public addresses that are not directly connected to the addresses that are used in transactions.Anyone can access a history of transactions made on the blockchain--even you. Even though transactions are recorded publically on the blockchainplatform, identifying personal information of the user isn't. For the Bitcoin blockchain there is only one public key is recorded next to each transaction. Thus, transactions are private but not anonyme. In this regard, Bitcoin the transactions appear more clear and trackable than cash because all of they are accessible for public access, unlike private cash transactions. But Bitcoin transactions also have an element of privacy built into their design. It's extremely difficult to trace the transactions of the parties--i.e. the party who sent and received bitcoins on the cryptocurrency's own blockchain.International researchers and the FBI claim to be able to verify transactions carried out on the Bitcoin blockchain to the users' other online accounts, including their digital wallets.2 For instance, if the user creates an account through Coinbase they will need to supply their identification.3 In the future, when that individual purchases bitcoin, the transaction is tied to their personal name. When they transfer it to another account, it will still be traced back the Coinbase purchase that is connected to the person who owns the account. This shouldn't cause concern to most buyers since Bitcoin will be legal in U.S. and most other developed countries.Make sure you check whether there are any legal or regulatory, and taxation status for buying and selling bitcoin in the region where you live before transacting.Buying BitcoinWe? have described the steps required for purchasing bitcoin in the following steps. You should remember to conduct your own research and pick the most appropriate option according to your specific circumstances.Step 1: Choose a crypto-trading service or venueThe first step in buying bitcoin is choosing a crypto trading site or venue. Most popular venues and trading services for purchasing cryptocurrencies include cryptocurrency exchanges, payment services, and brokerages. In all of them, cryptocurrency exchanges provide the best option since they come with a wide range of features and crypto currencies to trade.Registering for a cryptocurrency exchange lets you buy, sell and keep cryptocurrency. It is generally recommended to go with an exchange which lets its customers withdraw crypto to their own account online for safe keeping. When it comes to trading Bitcoin or any other cryptocurrency, this feature might not be relevant.There are many types or cryptocurrency exchanges. Since the Bitcoin concept is about personal sovereignty and decentralization, certain exchanges allow users remain anonymous and do not need users to input particular information about themselves. Such exchanges operate autonomously and are usually decentralized, so they don't have a central source of control.Although these systems could serve nefarious purposes, they can serve as a service to the vast majority of people without banking. For certain categories of individuals, like refugees and those living in countries where there isn't much infrastructure for government credit or banking--anonymous exchanges may help get them to join the mainstream economy.In the moment, most of the popular exchanges do not decentralized , and they follow regulations that need users to present identifying documentation. On the United States, these exchanges include Coinbase, Kraken, Gemini, FTX, and Binance.US just to mention a few. These exchanges have grown dramatically in the number of features they offer.The crypto universe has grown rapidly in the last 10 years as a number of new coins have been seeking investor dollars. With the exception of Bitcoin and certain prominent coins, such as Ethereum but not all of these tokens are accessible on all exchanges. Each exchange has its own set rules to decide if it's appropriate to include or exclude trading on specific tokens.Coinbase, Kraken, and Gemini provide Bitcoin and a variety of altcoins. These three are likely to be the most convenient on-ramps to cryptocurrency across the whole industry. Binance targets a more advanced traderand has an enhanced trading experience and greater variety of cryptocurrency options. FTX is a fast-growing cryptocurrency exchange with its valuation to be multibillion dollars, also offers the limited number of altcoins to U.S. investors.4 However, traders outside those from the U.S. have a greater choice of tokens on its platform.One important point to remember when creating accounts for cryptocurrency exchanges is to ensure that you are using secure Internet practices. This means two-factor authentication, as well as a long, unique password that includes lowercase characters, capitalized letters in addition to special characters, as well as numbers.El Salvador made Bitcoin legal tender on September 7, 2021. It was the only country to do so.5 The cryptocurrency is used as a means of payment for all transactions in which the business will accept it. It is the U.S. dollar continues to be the currency of El Salvador.Step 2: Then connect the exchange a payment optionAfter you have chosen the exchange option, you'll require your personal documents. According to the exchange you choose, they could include photos of a driver's license or Social Security card, as in addition to information about your employer and the source of your funds. The information you require will vary depending on the area you reside in and laws within it. The process is almost similar to setting up a typical brokerage account.Once the exchange has confirmed your identity, you will be required to connect a payment option. At the majority of exchanges, it is possible to can connect your bank account to the exchange directly, or you can connect a debit or credit card. Although you are able to use your credit card to buy cryptocurrency, it is not a good idea because the volatility of cryptocurrency prices could increase the cost of buying the coin.Bitcoin exists in legal form in United States, but some banks may question or even block deposits to crypto-related websites or exchanges.6 It's it's a good idea to ensure that your bank is able to accept deposits at the exchange you choose.There are varying fees for deposits through bank accounts such as debit or credit card. You should research the costs associated with any payment option so that you can you choose an exchange, or choose the option that is best for you.Exchanges also charge fees per transaction. They may charge either a flat amount (if the trading value is not large) or proportional to the trading amount. Credit card transactions incur an extra processing fee in addition to the transaction fee.Step 3. Place an orderYou can buy bitcoin (or other cryptocurrency) after choosing an exchange as well as connecting to a payment option. In the past few years cryptocurrency exchanges have slowly became more accepted. They have seen a significant increase in terms of liquidity and their range of features. The operations of cryptocurrency exchanges coincide with the change in the perception of cryptocurrency. A sector that was previously seen as a fraud or one that had questionable practice is gradually evolving into an honest one which has drawn interest from all of the major players in the world of financial services.Now, cryptocurrency exchanges have gotten to a point where they are able to offer nearly the same degree of functionality as their stock brokerage counterparts. Crypto exchanges today offer numerous types of order and ways to invest. A majority of cryptocurrency exchanges offer both market and limit orders. A few provide stop-loss transactions. Of the exchanges discussed above, Kraken offers the most order types. Kraken can accommodate market, limit, stoploss, stop-limit also known as take-profit as well as limit orders.7In addition to offering a range of options for orders, the exchanges offer options to establish recurring investments, allowing clients to incorporate a dollar-cost average into their chosen investments. Coinbase for instance, lets users set recurring transactions for each week, day, or month.8Step 4: Secure storageCryptocurrency and Bitcoin wallets are an ideal place to store digital assets more securely. Being able to store your cryptocurrency away from the exchange but in your personal wallet ensures that only you have control over the private key to your money. Additionally, it gives you the ability to store funds away from an exchange , and reduce the possibility that your exchange could be hacked and the loss of your funds.Although the majority of exchanges offer users with wallets, security isn't their main business. We do not generally recommend the use of exchange wallets for significant or long-term investments in cryptocurrency.Certain wallets offer more features than other wallets. Some are Bitcoin only, and others are able to store numerous types of altcoins. Some wallets additionally offer the possibility of swapping one token with another.When it comes to choosing a Bitcoin wallet, you have several choices. First, you'll be able to comprehend about crypto wallets is the concept of hot wallets (online wallets) and cold wallets (paper or physical wallets).Hot walletsOnline wallets are also known under the term hot wallets. Hot wallets are those that run on devices that are connected to the Internet, such as computers, phones or tablets. It is possible for them to be vulnerable since hot wallets create secret keys to your currency in these devices connected to the Internet. Although a hot wallet may be extremely convenient due to the method that you can access and make transactions with your cash quickly, having your private keys on a device connected to the internet makes it more vulnerable to attack.It may sound odd and a bit naive, but wallets who aren't putting in enough protection run the risk losing money due to theft. It's not a rare event, and it could occur in a variety of ways. For example, you could boast in a public forum such as Reddit about the amount of bitcoin you hold while you're using little to nothing secure and storing it in a hot vault would not be prudent. These wallets can be secured as that precautions are taken. Secure passwords, two-factor authentication, and secure Internet browsing are essential necessities.These wallets are perfect for small amounts of crypto or other cryptocurrency you are actively trading with an exchange. A hot wallet to a bank account. A common sense financial advice is to only put money spent in a checking account while the bulk of your money is in savings accounts or other investment accounts. Similar could be said in the case of wallets that are hot. Hot wallets encompass mobile, desktop, web and exchange account custody wallets.As was mentioned earlier, exchange wallets are custodial account that is provided by exchanges. The person who uses this wallet sort is not holder of the public key to the cryptocurrency held within the wallet. In the event that an incident would occur where the exchange compromised or your account gets compromised, you'd have to forfeit your funds. The phrase "not your key, not your coin" is often repeated within cryptocurrency forums and communities.Cold walletsThe simplest description for cold wallets is that it's not tied to Internet and therefore has an extremely low risk of being at risk of being compromised. These wallets might also be known as offline wallets or even hardware wallets. They are wallets that store a person's private key on something and isn't connected the internet and can come with software that functions in parallel, so that users can see their account without putting their private keys in danger.Perhaps the most secure method to store your cryptocurrency offline is with a paper wallet. Paper wallets are digital wallet that is created on certain websites. Then, it generates private and public keys which are printed out on a piece of paper. Access to the cryptocurrency within these addresses is only possible when you have the piece of sheet of paper with a private key. A lot of people laminate their cash wallets with paper and store them in safe storage boxes at the bank or in a safe at home. These wallets are meant for long-term investments and high security because you are not able to rapidly sell or trade bitcoin stored with these wallets.A more popular kind of cold cash wallet is a wallet made of hardware. Hardware wallets are typically comprised of a USB drive that holds personal keys of the user offline. They offer a significant advantage over hot ones since they are immune to viruses that could be infected by computer. With hardware wallets, private keys are not in contact with your computer's network or potentially vulnerable software. The devices are usually open source, allowing the community to judge the safety of these devices by performing code audits rather than a company claiming that they are reliable to operate.It is believed that cold-money wallets provide the most safe method of keeping your bitcoins or other cryptocurrencies. However, they require more knowledge of technology to set up.An excellent way to set your wallets is to set up three things that you need: an exchange account for buying and selling with a hot or hot wallet that will hold small to moderate amounts of cryptocurrency that you plan to trade or sell as well as a cold hardware wallet to keep larger quantities for long-term time periods.How to Buy Bitcoin With PayPalBitcoin? can also be purchased through payment processor PayPal? Holdings, Inc. (PYPL). There are two ways to buy bitcoin through PayPal?. The first and most practical method is purchasing cryptocurrencies by using your PayPal? account, which is linked with a payment instrument such as a debit card or bank account. Another option is to make use of the balance of account balances in your PayPal? account to purchase cryptocurrency from a third party provider. This option is not much as user-friendly since very few of the third-party sites allow users to buy bitcoin through this PayPal? button.Four cryptocurrencies--Bitcoin, Ethereum, Litecoin, and Bitcoin Cash--can be purchased directly through PayPal?.9 With the exception of those who live in Hawaii, residents of all states can either use their existing PayPal? accounts or set up new ones. You can also use your cryptocurrencies to buy goods and services through"Checkout With Bitcoin" or the "Checkout With Crypto" feature.10For the purpose of opening a crypto account with PayPal?, the following information is needed to establish a PayPal? account: name, physical address, date of birth, and tax identification number.11It is not possible to use a credit card to purchase Bitcoin using PayPal?. In the process of buying, PayPal? will display a price for the cryptocurrency. However, this price is subject alteration rapidly because of the volatility of cryptocurrency markets. It's a good idea for you to check if you have more than the amount you budgeted for the purchase in your account at the bank.If you buy bitcoin directly via PayPal?, it makes money off the crypto spread or the difference between Bitcoin's price in the market plus its price of exchange with USD. PayPal? can also charge you a cost for every purchase. The fee is based on the dollar value of the purchase. For instance the flat cost of $0.50 is per purchase between $100 and $200. Thereafter, the fee is proportional to the total dollar amount. For instance, a fee of 2 percent on the total amount is due for transactions between $100 and $200.12One disadvantage of purchasing cryptocurrencies via PayPal? is that you aren't able to transfer the crypto out of the pay processor's website. Thus, it's not possible for you in order to transfer your Bitcoin purchase from PayPal?'s account to an outside crypto wallet, or your personal wallet.11<iframe src="https://www.youtube.com/shorts/wYJhUGVaeyk" width="560" height="315" frameborder="0" allowfullscreen></iframe>The third disadvantage of PayPal? is that a small number of merchants and exchanges allow the use of the payment processor to purchase payments. eToro is one of the few online trader that allows users to use PayPal? to buy bitcoin on its platform.13How to Buy Bitcoin With a Credit CardThe? procedure for buying bitcoin with credit cards follows the same procedure for purchasing it via debit card or through electronic clearinghouse (ACH) transfers. The buyer must enter your credit/debit card details to the online trading or exchange firm and sign the transaction. In general, , it's not a good option to buy bitcoin with credit cards. There are a couple of reason for this.First of all, the majority of exchanges don't allow bitcoin purchase using credit cards because of the processing costs and the possibility of fraud. This can be for the benefit of customers. This is since credit card processing can apply additional charges to transactions. Thus, in addition to the transaction fee it will also leave you with processing fees that an exchange will pass on to you.The second reason is because transactions made with credit cards may be expensive. The issuers of credit cards treat bitcoin transactions as cash advances and have to charge high-cost fees and rates on advances. For example, American Express and Chase both consider cryptocurrency purchases for cash advance as. If, for instance, you purchase $100 worth worth of bitcoin using an American Express card, you are required to pay at least $10 (current cash advance fees for such transactions) and the annual percentage rate of 25 percent. Additionally, the credit card firm also limits you to making $1,000 worth of bitcoin purchases per month.14An alternative method of purchasing bitcoin using a credit/debit card is to buy one of the Bitcoin Rewards credit card. These cards work like a typical rewards credit card except they pay rewards in type of bitcoin. The cards invest earnings from purchase into Bitcoin. One illustration of an Bitcoin rewards credit card would be BlockFi? Bitcoin Rewards Credit Card.15 Be aware that the annual fees for these cards could be high and may also be added costs associated with the conversion of fiat currencies in crypto.Although exchanges such as Coinbase or Binance remain among the most used methods to buy Bitcoin However, they're not the only choice.Alternative Ways to Buy BitcoinBitcoin? ATMsBitcoin? ATMs act like in-person bitcoin exchanges. The user can add cash to the machine that can be used to purchase bitcoin. It is then stored in online wallets for users. Bitcoin ATMs have been more widespread in recent times. Retail major Walmart Inc. (WMT) is trialling a pilot program that will offer its customers the option to purchase bitcoin. Coin ATM Radar can help find the nearest ATMs.However ATMs can be costly alternative. There are two charges associated with ATM bitcoin transactions which are a purchase charge and an exchange fee to convert cash to bitcoin. Both are quite high when compared with other alternatives. For instance, the world average charge for purchase of Bitcoin ATMs is 8.4 percent (of the amount of purchase) and 5.4 percent for sales made at ATMs.16Be aware that Bitcoin ATMs are now requiring government-issued IDs since the beginning of 2020.P2P exchangesInstead of decentralized exchanges, that provide buyers and sellers with anonymity and facilitate all aspects of the transaction, there are peer-to-peer (P2P) exchanges that provide a more direct interaction between users. LocalBitcoins? is an example of this type of exchange. Once an account has been created, users can request to purchase or sell bitcoin. This includes information about payment methods and prices. The users can then look through the listings of sell and buy offers in order to choose the business partners with whom they wish to transact.LocalBitcoins? allows for certain aspects of trading. Although P2P exchanges may not provide the same anonymity as decentralized exchanges, they also give customers an opportunity to compare prices for the best deal. Many of these exchanges also offer rating systems to ensure that users have the ability to evaluate potential trade partners before making any transactions.Mainstream brokeragesA few major brokerages provide the capability to trade and buy bitcoin because of the uncertainty regarding the legality of cryptocurrency. Robinhood Markets, Inc. (HOOD) is an application loved by retail investors, is one such exchange that provides crypto trading facilities. It charges no commissions for cryptocurrency trading and purchases . It makes money from the transaction flow that it receives, transferring its trading volume to the other platforms for trading or brokerages.17The absence of a commission fee can be a enticing option in the beginning, but there are a couple of negatives with this deal. The first is that Robinhood isn't equipped with the range of features and currencies offered by prominent crypto exchanges such as Coinbase. Robinhood allowed trading on its platform, which supports seven cryptocurrencies: Bitcoin, Bitcoin Cash, Ethereum, Bitcoin SV, Dogecoin, and Ethereum Classic.18 But, in contrast, you can trade more than 100 cryptocurrency through Coinbase.19 The exchange also provides several types of orders to limit the risk of losing money during trading.The Robinhood platform does not offer a hosted wallet. If you are looking to buy cryptocurrency through Robinhood the platform, you'll have add on additional costs to an online wallet service.Bitcoin and other cryptocurrency investments are NOT protected by insurance through this organization. Securities Investor Protection Corporation (SIPC). In normal brokerages this agency is able to protect against the loss of securities and cash in brokerage accounts with up to $500,000, with a $250,000 cash limit.20 This service isn't available to customers from cryptocurrency exchanges. Coinbase and other cryptocurrency exchanges Coinbase have insurance for crime to guard their infrastructure against attacks. However, that insurance won't safeguard individual customers against password theft.21How to Sell BitcoinIt? is possible to sell bitcoin on similar places to where you bought the cryptocurrency, for instance, cryptocurrency exchanges and P2P platforms. Typically, the process of selling bitcoin through these platforms is similar to the procedure for buying it.In this case, for instance, you could only have to press to select an order type (i.e., whether the cryptocurrency must be sold immediately at available prices or whether it is to be sold to minimize losses) to make the sale. Depending on the market composition as well as the demand for the particular venue the cost of selling Bitcoin can be different. In the case of exchanges, for instance, South Korea traded bitcoin at a so-called kimchi premium during the price increase in the year 2018.Currency exchanges that trade in crypto charge a proportion of the sale price as fees. For instance, Coinbase charges 2.49% of the transaction total as fees.22Exchanges typically have monthly and daily withdrawal limits. Therefore, cash from the sale may not be accessible immediately to the trader. There aren't any limits to the amount of bitcoin you can sell however.What Are the Steps for Purchasing Bitcoin?The process for purchasing bitcoin consists with four main steps: choosing an exchange or venue to place your order in, choosing a payment method and ensuring secure storage for your bought cryptocurrency. Depending on the location chosen in the very first stage, there could be additional steps required in the process. For instance, if, for example, you make a purchase of the cryptocurrency through Robinhood you might need to include additional expenses for an online wallet as well as the custody of your bitcoins since the company does not offer these services.What Are the Most Popular Venues for Buying Bitcoin?The most sought-after places for buying bitcoins include cryptocurrency exchanges as well as brokerages (crypto along with mainstream) and payment service such as PayPal?. You can also purchase Bitcoin from P2P exchanges. To acquire indirect ownership of bitcoin you may buy shares in companies that keep the cryptocurrency in their balance sheets, such as Tesla, Inc. (TSLA) or MicroStrategy? Incorporated (MSTR).2324How Much Should I Expect to Pay to Purchase Bitcoin? http://www.docspal.com/viewer?id=- for purchasing bitcoin includes one fee per trade in addition to costs to convert a cash currency (generally dollars) to bitcoin. (Cryptocurrency exchanges and payment solutions make money from this conversion spread.) The fee per trade is dependent on the dollar amount of the trade. A higher trade amount will incur higher fees. The total price of purchase is contingent upon the features offered by the provider. For instance, Robinhood does not currently offer an online wallet service for keeping bitcoin. Thus, you'll have to budget for online wallet costs for your purchase.Besides Cryptocurrency Exchanges, Where Else Can I Buy Bitcoin?You can also purchase bitcoin from the following stores:* Through Bitcoin ATMs* Through online payment services such as PayPal?* At mainstream brokerages like RobinhoodIs? My Bitcoin Purchase Protected by SIPC?There is no way to ensure that the purchase you make with bitcoin is not protected by SIPC.20 On certain exchanges such as Coinbase the balances of fiat currency in individual accounts are FDIC insured in the amount of $250,000 per account.21The Bottom LineThe? process of buying bitcoin is slightly more complicated as compared to buying stock or shares in the normal way. This is due to the ecosystem and infrastructure for bitcoin isn't as well developed as those of mainstream trading.A bitcoin purchase process consists in four steps: choosing an option or a place to make payment, connecting with an online payment system, making the order, and also ensuring safe storage for the cryptocurrency. Each step requires extensive research and careful review of the pros and benefits of each choice. Bitcoin can be purchased through Bitcoin ATMs or by using payment services like PayPal? and major brokerages such as Robinhood.