If you already know the benefits of bitcoin and have interest to purchase or invest some, in this article, we will show you various ways to do that. Buying Bitcoin could be very simple in some countries and might be tricky in others. There are multiple types of venues for buying Bitcoin, each focused on different client types, circumstances and jurisdictions.
Cryptocurrency Exchanges are the most popular and easiest venues for individuals or institutions who wish to purchase bitcoin. Exchanges could provide traders or institutions to execute complex trading strategies, whereas also be able to provide simple user experience for people who are new to crypto and want the easiest way to buy
Bitcoin as a long
term investment or for usage as a currency. Most cryptocurrency exchanges, including Mexo, allow you to securely custody Bitcoin on their platform after purchase. If you are not familiar with how to store your own private key or have zero experience in Bitcoin wallet, then it could be easier for you to store your asset on a trustable exchange
Mexo Exchange is available for individuals or institutions buying from small amounts to very large amounts of Bitcoin. It takes less than 1 minute to sign up and you can start to buy your first Bitcoin.
People also trade Bitcoin for fiat currency
peer-to-peer either in person or online. In the early days, this was one of the few ways to buy
or sell bitcoin. However, today meet in person is a less common method due to the fraud and safety risks associated with buying from untrusted sellers or interacting with people in person. Using P2P platforms to trade bitcoin is still a very choice in certain countries where direct bank transfer is not convenient. P2P platforms should be able to play the custody role in between to make sure the transaction is completed and protect both buyers and sellers. The premium for P2P transaction is normally higher than direct transaction through the exchange
Mexo’s P2P platform also provide trustable service to those users that in need of P2P transaction.
The method of purchasing bitcoin can vary depending on the size and urgency of the order
, and other factors such as privacy. Over-the-counter (OTC
) desks transact with institutions or individuals with their own custody solutions looking to buy
very large amounts of Bitcoin (Generally minimum requirement over $100K). OTC
desks focus on trading blocks of Bitcoin between large sellers (e.g. miners) and buyers (e.g. hedge
funds) and most OTC
desks will complete the transaction within 24-48 hours of purchase.
Derivatives are tradable securities that derive their value from its underlying assets like stocks, currencies, bonds, and commodities. The most common types of derivatives are futures, forwards, and options. In 2017, the growing demand for Bitcoin futures prompted major traditional finance exchanges such as CME Group Inc and CBOE Global Markets Inc to launch Bitcoin futures contracts. Contract offer higher leverage exposure to traders. Bigger reward and higher risks.
Bitcoin ATMs provide a way to purchase Bitcoin at a physical kiosk, often located in a gas
station or grocery store. Bitcoin ATMs often require you to scan an ID to fulfill compliance obligations. A buyer then inserts cash and gives the Bitcoin ATM an address
to which to send Bitcoin. Bitcoin ATMs typically charge a significant premium over online brokerages.
Opening an Account at a Bitcoin Exchange
Before you open
an account at an exchange
, examine its KYC requirements, verification levels, withdrawal and deposit waiting periods, order
and withdrawal fees, and other variable factors that differ for each exchange
. Be prepared to submit personal information in the form of a photo of your government-issued ID and more. Once you’ve created an account, you may notice that the exchange
provides its own wallet. Many third-party exchanges have wallets—called “custodial wallets”—built into the platforms themselves. Custodial wallets allow you to send and receive cryptocurrency, they holds your coins “in custody” on your behalf.
Choosing Your Purchasing Method
For most people, purchasing bitcoin through an exchange
is the most ideal method. This is sometimes called “spot
” buying, and consists of purchasing bitcoin by linking a bank account, debit/credit card or other payment method like PayPal to the exchange
account. As previously mentioned, each jurisdiction has exchanges that are tailored to its citizens. Search for bitcoin exchanges that service your area and find out which are the most popular and trusted. (You could even consult your local Bitcoin communities—on Telegram, Twitter, Reddit, WeChat, Discord or wherever else Bitcoiners gather—to learn where they buy
For institutional investors or those looking to get exposure to the price of bitcoin without registering on a cryptocurrency exchange
, there are offerings on regulated stock exchanges, such as futures, mining stocks and other derivatives that provide exposure to Bitcoin without purchasing the cryptocurrency.
Bitcoin can be purchased in a variety of ways, with trade-offs between volume
, security, privacy, and premiums.
Most retail investors could use exchange
such as Mexo to buy
and store their bitcoin.
Exchanges usually offer
to store your bitcoin for you. You can also hold your bitcoin independently with a bitcoin wallet.
Most institutions selling Bitcoin require the same information required by banks: government-issued ID, ID Number, and even physical address