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The process of investing in Bitcoin (BTCUSD) could seem complicated, but it is easier to understand if you reduce it into steps. Making investments or trading Bitcoin is easy if you have an account at a service or exchange, but more secure storage practices are recommended.There are a variety of things aspiring Bitcoin investors require such as a cryptocurrency exchange account or personal identification document to use a Know Your Customer (KYC) platform as well as a secure connection to the Internet, and a method for payment. It is also suggested that you use your own private wallet separate from your exchange account. Affordable methods to pay with this route include bank accounts along with debit cards and credit cards. You can also obtain bitcoin through ATMs that are specifically designed and through P2P exchanges.KEY TAKEAWAYS* The value of Bitcoin comes from the fact that it is a popular store of value and payment system, as well as its finite supply and decreasing inflation.* Even though it's nearly impossible to allow Bitcoin itself to be hacked but it's still possible for your exchange or wallet system to suffer a breach. This is the reason that implementing appropriate safeguards and storage is imperative.* You can also buy bitcoin with mainstream companies like PayPal? and Robinhood.* One option to acquire bitcoin indirectly is to invest in companies with bitcoin on their balance sheet.Before You Buy BitcoinSecurity? and privacy are crucial security and privacy concerns concerning security and security for Bitcoin investors. Anyone who gains the private password to a publicly accessible address via the Bitcoin blockchain can be authorized to make transactions.1 Private keys must be kept secret. Criminals might attempt to take them away when they discover huge assets. It is important to be aware that anyone can examine the balance of a private address you've registered. But the upside to these public records is that individuals can make multiple public addresses for themselves. So, they can share their stash of Bitcoin across multiple addresses. A great strategy is to safeguard investments with significant amounts at public addresses that are not directly connected to addresses which are used for transactions.Anyone can review a log of transactions made on the blockchain, even you. Even though transactions are recorded publically by the blockchain, the identification of individual information about the user isn't. While on the Bitcoin blockchain users only have their public key appears next to a transaction--making transactions confidential however not completely in any way anonymous. In that way, Bitcoin transfers are much easier to trace and trackable than cash because all of them are open to public scrutiny, unlike private cash transactions. But Bitcoin transactions also come with an element of anonymity built within their designs. It's very difficult find the transacting parties--i.e. the party who sent and received bitcoin--on the blockchain of the cryptocurrency.Researchers from around the world and the FBI have said they are able to monitor transactions on the Bitcoin blockchain back to users' other online accounts, including their digital wallets.2 For example, if you create an account on Coinbase and then registers, they need to show their identification.3 In the future, when that user purchases bitcoin, it can be traced back to their name. If they transfer the funds to other wallets, it could still be tracked back to the Coinbase purchase which is tied to the account holder's name. It shouldn't concern the majority of buyers since Bitcoin can be legally used in the U.S. and most other developed countries.It is important to know regulations, laws, as well as tax-related status of purchasing and selling bitcoins where you reside before you make any transactions.Buying BitcoinWe? have broken down the steps needed for purchasing bitcoin in the following steps. Make sure study the options thoroughly and select the best option for yourself based on the circumstances you face.Step 1: Choose an online trading platform or venueFirst step in buying bitcoin is to select the right crypto trading service or a location. The most popular options for trading and venues that allow the purchase of cryptocurrencies comprise cryptocurrency exchanges, payment services and brokerages. These exchanges are by far the most convenient option since they come with a wide range of features and exchanges using cryptocurrencies.Signing up for a cryptocurrency exchange will enable you to buy, sell and hold crypto. It is generally best practice to select an exchange that allows users to take crypto out of their private online wallet to keep safe. For those looking to trade Bitcoin as well as other cryptocurrencies, this option may not be necessary.There are a variety of exchanges for cryptocurrency. Because the Bitcoin philosophy is one of personal sovereignty and decentralization, certain exchanges permit users to remain anonymous and do not have to require particular information about themselves. These exchanges operate as autonomous entities and are usually decentralized, which means that they don't have a central source of control.Though these systems can be used for some nefarious ends, they also provide benefits to the poorest of the world's inhabitants. For certain categories of people--refugees or people living in countries that have no infrastructure for credit from the government or banking, anonymous exchanges could help make them part of the mainstream economy.<img width="303" src="https://image.slidesharecdn.com/v3-q32015sob1-151014141801-lva1-app6892/95/state-of-bitcoin-and-blockchain-q3-2015-15-638.jpg?cb\u003d1521822877">However, at present, many of the major exchanges aren't decentralized and adhere to laws that demand users submit identifying documentation. The United States, these exchanges include Coinbase, Kraken, Gemini, FTX, and Binance.US There are many others to mention. These exchanges have seen significant growth in terms of the features they provide.The cryptocurrency world has grown rapidly in the last 10 years with numerous new tokens seeking investor dollars. Except for Bitcoin and certain prominent coins, such as Ethereum there are a few exceptions to the fact that not all these tokens can be found on all exchanges. Each exchange has their own set of rules that determine whether they will include or exclude trading on specific tokens.Coinbase, Kraken, and Gemini offer Bitcoin and a broader range of altcoins. They're probably the easiest crypto on-ramps within the entire cryptocurrency industry. Binance caters to a more advanced buyer, offering an enhanced trading experience and more diverse altcoin choices. FTX is a rapidly-growing crypto exchange that has garnered an investment of multibillion dollars, offers limited amounts of altcoins to U.S. investors.4 However, investors outside of within the U.S. have a greater selection of tokens on its platform.A crucial thing to keep in mind when creating an account with a cryptocurrency exchange company is the need to employ secure Internet practices. This means two-factor authentication. A long, unique password that comprises a variety lowercase and capitalized letters along with special characters and 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 currency for any transaction in which the business will accept it. This is why the U.S. dollar continues to serve as El Salvador's main currency.Step 2. Join your currency to a payment optionOnce you've decided on the exchange option, you'll be required to gather your personal documents. Based on the exchange, the documents could include a photo of your driver's license or Social Security card, as well as information about your employer as well as the source of funds. The information you require will vary depending on the area your home is located in and laws that apply to it. The process is almost similar to creating a typical brokerage account.After the exchange has verified your identity, you will be asked to join with a payment option. The majority of exchanges can connect to your bank account through the account or connect a credit or debit card. While you may use a credit card to buy cryptocurrency, it is not recommended because cryptocurrency price volatility could inflate the total cost of purchasing a coin.Bitcoin has been legalized in the United States, but some banks may be reluctant to accept or suspend deposits on crypto-related websites or exchanges.6 It's an excellent idea to confirm to see if your bank will accept deposits at the exchange you prefer.There are different charges for transactions made with a banking account debit or credit card. It is vital to look into the costs associated with every payment method to help select an exchange option or decide which one works best for you.Exchanges can also charge fees per transaction. These charges could be an unrestricted fee (if the trading value is low) or some percentage of the trading amount. Credit cards are charged an extra processing fee in addition to the transaction costs.Step 3: Make an orderBitcoin can be purchased (or other cryptocurrencies) after choosing an exchange and linking a payment option. In recent years crypto exchanges have slowly became more accepted. They have seen a significant increase in terms if liquidity and their number of features. The operational changes at cryptocurrency exchanges are in line with the shift in the perception of cryptocurrencies. A business that was believed to be a scam or with questionable practices is gradually becoming an established one that has attracted the attention of every major player in the financial services industry.In the last few years, cryptocurrency exchanges have become so popular that they're equipped with the same level of features as their counterparts with stock brokerages. Today, cryptocurrency exchanges offer many different kinds of orders and investment options. Many crypto exchanges have both limit and market orders. Some offer stop-loss orders. The exchanges listed above, Kraken offers the most possible types of orders. Kraken offers market, limit, stop loss, stop limit or take-profit limit orders.7Apart from the various different types of orders, exchanges provide ways to create regular investments, which allows clients to add a dollar-cost average to their investments of choice. Coinbase is one example. It lets users make recurring purchases for each day, week or month.8Step 4: Secure storageDigital wallets such as Bitcoin or Cryptocurrency provide an ideal place to store digital assets with greater security. A crypto wallet that is separate from the exchange , and instead in your own wallet, you can be sure that only you control the private key that you have to your funds. Additionally, it gives you the ability to secure your funds from an exchange , and reduce the risk of your exchange being hacked and causing loss of funds.While most exchanges offer wallets to their customers, security isn't their main business. We generally don't recommend making use of an exchange account for large or long-term cryptocurrency holdings.Some wallets provide more features than other wallets. Some are Bitcoin only, and others are able to hold numerous types of altcoins. Certain wallets also have the ability to swap one token for another.When you're trying to decide on the right Bitcoin wallet, you can choose from a number of options. The first thing you will have to be aware of about crypto wallets is that they are made up of hot wallets (online wallets) and cold wallets (paper or physical wallets).Hot walletsThey are referred to as "hot wallets. Hot wallets run through Internet-connected devices like computers, phones, or tablets. It is possible for them to be vulnerable since these wallets create the private keys to your bank accounts in these devices connected to the Internet. While a hot account can provide convenience in the manner that you can be able to access and manage your money quickly, keeping your private keys using an Internet-connected device may make it more susceptible to a hack.This may seem a bit nebulous it's not, but those who aren't putting in enough security could be at risk of losing their money to theft. This is not an infrequent event, and it could occur in several ways. For instance, bragging in a public forum such as Reddit about how much bitcoins are in your wallet when there is little or nothing secure and storing it in a hot account would not be prudent. The fact is, these wallets are secure as you take the proper precautions. Secure credentials, two-factor authentication, and secure Internet browsing are the minimum prerequisites.These wallets work best for small amounts of crypto or cryptocurrency that you're involved in trading with an exchange. You can compare a hot wallet to a checking account. Conventional financial wisdom would say to hold only spending money with a check-book account while the majority of your funds is stored in savings accounts or other investment accounts. Similar could be said on hot wallets. Hot wallets can be described as mobile, desktop, web, and exchange accounts custody wallets.In the past, exchange wallets are custodial account that is provided by exchange. The person who uses this wallet sort is not holder of the key private for the cryptocurrency in the wallet. In the event of an event to occur , where the exchange becomes compromised or your account is compromised, you could lose your money. The phrase "not your key, not your coin" is frequently frequented in cryptocurrency forums and communities.Cold walletsThe most basic description of a cold-wallet is that it isn't linked to the Internet and therefore has greater risk of being compromised. These wallets can be referred to as offline wallets or even hardware wallets. These wallets store a user's private keys on a device remote from the internet. They are also equipped with software that runs in parallel so that users can see their portfolio without putting their private key at risk.The most secure method for storing cryptocurrency offline is using a paper wallet. Paper wallets are wallet you can make off of certain websites. It then generates private and public keys which can be printed on paper. The ability to access bitcoin and other digital currencies is only possible if you own the piece of paper that has the private key. A lot of people laminate their paper wallets and keep them in safe deposit boxes at banks or even in a secure in their home. These wallets are for more secure and long-term investments due to the fact that you can't quickly sell or trade bitcoins stored in this way.A more typical type of cold wallet is a hardware one. Hardware wallets are generally made up of a USB drive that holds one's personal keys offline. They have a number of advantages over hot ones since they aren't affected by viruses that can infect one's computer. Hardware wallets ensure that private keys don't come in contact with your network-connected computer or potentially vulnerable software. The majority of these devices are open source, allowing the community to judge their security using an audit of the code instead of a company claiming they are secured to work with.A cold-wallet is by far the best and most secured way to store bitcoin or any other cryptocurrency. But they require additional technical knowledge to set up.A good way to set the wallets you want to use is to have three items the exchange account you use for trading and buying as well as a hot wallet that can keep small to moderate amounts of cryptocurrency you wish to trade or sell, and a cold hardware wallet to keep larger quantities with a longer time-frame.How to Buy Bitcoin With PayPalBitcoin? can also be bought through the payment processor PayPal? Holdings, Inc. (PYPL). There are two options to purchase bitcoin using PayPal?. The first and most practical method is to buy cryptocurrency through your PayPal? account that is connected to a payment method, such as a debit card or bank account. The second option is to use the balance on that PayPal? account to purchase crypto by a third party. This isn't as convenient as the first since a small percentage of third-party websites allow customers to purchase 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 or services by using"Checkout with crypto "Checkout With Crypto" feature.10To set up a crypto account through PayPal? it is necessary to provide the following details is required: name, physical address and birth date in addition to a tax-identification number.11It isn't possible to make use of a credit card to buy Bitcoin using PayPal?. When you purchase, PayPal? will display a price for the cryptocurrency. However, that price is susceptible alteration rapidly because of the fluctuation of markets for cryptocurrency. It's best to ensure that you have more than the price you have budgeted for your purchase in your savings account.If you purchase bitcoin directly through PayPal? the company earns money on the crypto spread or the difference between the market price of Bitcoin in addition to its conversion rate with USD. PayPal? will also charge a transaction fee for every purchase. These fees depend on the value of the purchase. For example the flat rate of $0.50 is per purchase between $100 to $200. After that, fees are a percentage of the overall dollar amount. A typical example is a charge of 2% of the total amount is applied to purchases made with cryptos between $100 to $200.12One drawback of purchasing cryptocurrency via PayPal? is that you cannot transfer the currency outside the company's platforms for payment. Therefore, it's possible to transfer your bitcoin purchase through PayPal?'s bank account to another crypto-wallet, or your personal wallet.11The downside of using PayPal? is that not many trader and exchanges accept that use of the processing company to purchase payments. eToro is one of the very only a few online sellers that allow you to make use of PayPal? to purchase bitcoins on its platform.13How to Buy Bitcoin With a Credit CardThe? procedure for buying bitcoin using credit cards is the same as the method for purchasing it through debit cards or through automated clearing house (ACH) funds transfers. It is necessary to enter your credit/debit card details to the exchange or online trading firm and they will then authorise the transaction. In general, however, it's not a good idea to purchase bitcoin using credit cards. There are several motives for this.First of all, there are some exchanges that do not permit bitcoin purchasing using credit cards due to associated processing fees and the risk of committing fraud. This might be for the benefit of the customers. This is because credit card processing could add additional charges onto transactions. Therefore, in addition to paying transaction fees it will also leave you with processing fees that the exchange will pass on to you.The second reason is because purchasing credit cards is costly. The credit card issuers regard bitcoin transactions as cash advances, and charge high fees and interest rates on these advances. For example, American Express and Chase both consider purchases of cryptocurrencies in cash-advance transactions. For instance, if you buy one hundred dollars worth of bitcoin through the American Express card, you will be charged just $10 (current cash advance fees for these transactions) plus the annual percentage rate of 25 percent. What's more, the credit card company will also limit your purchase to $1,000 of bitcoin transactions per month.14A second method of buying bitcoin with credit card is to obtain the Bitcoin Rewards credit card. These cards function similarly to your regular rewards credit or debit card, however, they reward you in the Bitcoin form. Thus, they put the money earned from purchases into Bitcoin. One illustration of one Bitcoin cards that reward you is called BlockFi? Bitcoin Rewards Credit Card.15 Beware, however, that the annual fees associated with these cards could be quite high and there could be additional expenses associated with the conversion from fiat currency to crypto.Although exchanges such Coinbase and Binance remain among the most popular methods to purchase Bitcoin but they're certainly not the only option.Alternative Ways to Buy BitcoinBitcoin? ATMsBitcoin? ATMs act like in-person bitcoin exchanges. People can deposit cash into machines and then use it to purchase bitcoin that is then sent to digital wallets of users. Bitcoin ATMs are more widespread in recent times. Retail company Walmart Inc. (WMT) is testing a pilot program that will give customers the option of buying bitcoin. Coin ATM Radar can help in locating the nearest ATMs.However, ATMs are an expensive option. There are two fees associated with ATM bitcoin purchases in the form of a purchase fee as well as the cost of conversion for changing a fiat currency to bitcoin. Both costs are quite costly in comparison to other options. For example, in the world, the average price of purchases of Bitcoin ATMs is 8.4% (of the amount of purchase) and 5.4% for sales at ATMs.16Be aware, however, that Bitcoin ATMs increasingly require Government-issued IDs starting in 2020.Exchanges between P2PIn contrast to decentralized exchanges that offer buyers and sellers a secure way to communicate and allow for all aspects of the transactions, there are peer-to-peer (P2P) exchange services which facilitate a faster relationship between users. LocalBitcoins? is an example of this type of exchange. After having an account, users are able to post requests to buy or sell bitcoin. This includes details about payment methods and costs. After that, they can browse through the lists of buy and sale offers to select the trading partners who they would like to transact.LocalBitcoins? helps with certain aspects of the trading. While P2P exchanges cannot provide the same level of privacy as decentralized exchanges they give users an opportunity to compare prices for the best deal. Most of these exchanges offer rating mechanisms so that their users are able evaluate possible trade partners before committing to.Mainstream brokeragesThe majority of brokerages do not offer bitcoin purchasing and trading features due to uncertainty about the regulation status of crypto currencies. Robinhood Markets, Inc. (HOOD) which is an app well-liked by investors who are retail, is one exchange that offers cryptocurrency trading options. It charges 0% commissions on cryptocurrency trades as well as purchases . The company earns money from payment for order flow passing its trading volume onto various trading platforms and brokerages.17The absence of commissions may be an enticing prospect for those just starting out, but there are a couple of problems with this offering. The first is that Robinhood lacks the number of features or coins offered by prominent crypto exchanges such as Coinbase. Robinhood offered trading on its platform to trade seven cryptocurrencies: Bitcoin, Bitcoin Cash, Ethereum, Bitcoin SV, Dogecoin, and Ethereum Classic.18 On the other hand, you can trade more than 100 different cryptocurrencies through Coinbase.19 The exchange also offers various types of orders that help minimize potential risk and limit losses when trading.The Robinhood platform also does not offer an online wallet. Therefore, if you intend to purchase cryptocurrencies through Robinhood then you'll have to take into consideration additional expenses for an online wallet provider.Bitcoin and other cryptocurrency investment options are not covered by insurance coverage from The Securities Investor Protection Corporation (SIPC). In regular brokerages the corporation protects against loss of securities and cash in brokerage accounts up to $5000, with a $2500-dollar cash limit.20 This insurance option isn't available to customers trading on crypto-currency exchanges. Coinbase and other cryptocurrency exchanges Coinbase are covered by insurance against crime to guard their infrastructure against attacks. But , this type of insurance cannot protect individual customers from password theft.21How to Sell BitcoinYou? can sell bitcoin in the same outlets where you bought the cryptocurrency like cryptocurrency exchanges or P2P platforms. Typically, the process involved in selling bitcoin on these platforms is similar to purchasing it.In this case, for instance, you could only have to click the button and specify an order type (i.e. to decide if the cryptocurrency should be sold instantly at the current price or if it should be sold to stop losses) to complete the sale. Depending on the market composition and demand in the area the price of offering for Bitcoin can be different. For example, exchanges in South Korea traded bitcoin at a so-called kimchi premium during the rise in bitcoin prices in the year 2018.Coinbase and other cryptocurrency exchanges charge a certain percentage of the cryptocurrency sale amount as fees. For example, Coinbase charges 2.49% of the transaction total as fees.22Exchanges typically have daily and monthly withdrawal limitations. This means that the money earned from an extensive sale may not be immediately available to the trader. There is no limit to the amount of cryptocurrency you can sell, however.What Are the Steps for Purchasing Bitcoin?The process for purchasing bitcoin is comprised from four phases: choosing the right venue or exchange for your order in, choosing a payment method and then making sure you have a safe place to store for your newly purchased cryptocurrency. Based on the venue chosen in the first step, there might be additional steps that are involved in the process. For instance, if you purchase the cryptocurrency through Robinhood you may have to add additional charges for an online wallet or custody of your bitcoins since it doesn't offer these services.What Are the Most Popular Venues for Buying Bitcoin?The most well-known places for buying Bitcoin are cryptocurrency exchanges as well as brokerages (crypto and standard) and payment providers such as PayPal?. You can also buy Bitcoin through P2P exchanges. For ownership in bitcoin that is indirect you can put money into companies that own the cryptocurrency on their balance sheets. For instance, Tesla, Inc. (TSLA) or MicroStrategy? Incorporated (MSTR).2324How Much Should I Expect to Pay to Purchase Bitcoin?The typical cost for buying bitcoin includes an amount per transaction plus the cost of changing a traditional currency (generally dollars) to bitcoin. (Cryptocurrency exchanges as well as payment services make money off of this conversion spread.) The cost per transaction is dependent on an amount in dollars that is associated with the trade. https://www.businesslistings.net.au/FINACNE/QLD/Maadi/ROYALQ/701082.aspx that is higher will incur higher fees. The cost of the purchase depends on features offered by the site. For instance, Robinhood does not currently provide an online wallet for the storage of bitcoin. So, you'll need be prepared for expenses for an online wallet purchase.Besides Cryptocurrency Exchanges, Where Else Can I Buy Bitcoin?Bitcoin can also be purchased at the following places:* Through Bitcoin ATMsPayments? can be made online using payment service providers such as PayPal?* At mainstream brokerages like RobinhoodIs? My Bitcoin Purchase Protected by SIPC?It's true that your purchase made with bitcoin is not covered by SIPC.20 For certain exchanges such as Coinbase the balances of fiat currency in individual accounts can be insured by FDIC at $250,000 per account.21The Bottom LineThe? process of purchasing bitcoin is a bit more complex than buying regular equity or stock. This is mainly because the cryptocurrency's ecosystem and infrastructure aren't as robust like the ones used in mainstream trading.The process of purchasing bitcoin is comprised in four steps: choosing an option or a place to make this purchase. Connecting to an option for payment, placing an order, then ensuring safe storage for your purchased cryptocurrency. Each step involves a lot of research and careful analysis of the pros and pros of each option. You can also purchase bitcoin through Bitcoin ATMs and from payment services such as PayPal? and major brokerages such as Robinhood.