A few years ago, it used to be very — and we mean very — difficult to buy Bitcoin with a credit or debit card. Thankfully, times have changed. Since Bitcoin was created in 2009, thousands of exchanges have popped up across the web and in brick-and-mortar stores with just that one purpose: to make buying and selling Bitcoin easier.
In this guide, we’re going to walk you through the process of buying and storing your first ever Bitcoin. Bear in mind that there are hundreds of ways to purchase and store cryptocurrencies, but in this article we’ll show you what we consider to be the easiest.
Buying Your First Bitcoin
The first step in buying and storing your first Bitcoin is, of course, actually buying it. There are dozens of ways to buy cryptocurrencies: you can buy direct from friends or family, use a local merchant service like LocalBitcoins, or sign up to a dedicated cryptocurrency exchange.
For the purposes of this guide, we’ll look at the last option: signing up to and buying from a dedicated cryptocurrency exchange.
Where to Buy Your Cryptocurrency: Bitcoin Exchanges
Bitcoin exchanges are the services you can use to purchase Bitcoin with a debit or credit card. Like any other currency exchange, Bitcoin exchanges buy and sell cryptocurrencies (in exchange for fiat money) in order to turn a profit.
If you think of PayPal, Bitcoin exchanges are pretty similar. You can deposit from your credit or debit card, you can store money online, and you can make online payments.That’s really all there is to it!
Note that there are other ways to purchase your first cryptocurrencies, but seeing as they often carry a higher risk, we’ll avoid them for now.
If you do a quick Google search for “cryptocurrency exchange”, you’ll see there are dozens (if not hundreds!) of cryptocurrency exchanges ready to take your money. While there are a good number of scams to watch out for, there’s also a surprising number of legitimate exchanges.
It’s up to you to choose your cryptocurrency exchange. We have a short list of reputable exchanges available on our website, but today we’ll walk you through the steps of using Coinbase — without a doubt, the cryptocurrency space’s most reputable fiat on-ramp.
Quick note: we love Coinbase for beginners, since it’s just so easy to use. However, Coinbase fees can be pretty high, so we’d hope you grow out of using the exchange in the long term. Until then, use our Coinbase referral link to get $10 of free Bitcoin with your $100-or-more purchase.
How to Buy Your Cryptocurrency
Using Coinbase — along with most other major exchanges — is actually really easy. Simply sign up for an account with your email address and you can start buying with credit or debit card right away. Since Coinbase is a regulatory-compliant exchange, you might also have to complete some basic KYC (Know Your Customer steps), like inputting your address.
The Three Essential Bitcoin Buying Steps
- Sign up to the exchange. If you’ve never used an exchange before, you’ll have to sign up. Navigate to your exchange of choice, press the “Sign up” (or equivalent) button, and follow the steps provided. Most exchanges will just need your name, email address, and a password to start with.
- Connect your credit card. Next up, you’ll need to add your credit or debit card as a payment method. For this, find your “Account” or “Settings” page and press the “Payment Methods” (or equivalent) button. Click to add a new debit/credit card and enter your details.
- Purchase your Bitcoin! With any luck, your card will already be set up. Make your way to the “Buy” page and purchase away at the exchange’s rate.
Here are the steps for Coinbase in particular:
Buying Bitcoin at Coinbase with a Credit/Debit Card
- Sign up at Coinbase
Navigate to https://www.coinbase.com/ and press the “Sign Up” button at the top right corner. Fill in your details and verify your email address.
- Verify your phone number
You’ll then receive an email from Coinbase asking you to verify your phone number. Click the link in the email and enter your phone number. Finally, grab your phone, wait for an SMS verification code, and enter it on the Coinbase website.
- Add your payment method
Head to the Coinbase dashboard and click the button labelled “Buy/Sell” (top left corner). Press “Verify Payment Method”, and then press “Add Payment Method” on the page you are taken to. Now click “Credit/Debit Card (3D-Secure)”.
- Verify your ID.
Choose an ID type (passport, driver’s license, or other photo ID) which you are able to verify. Use the Coinbase interface to take a photo of the front and back of your ID, using your webcam.
- Connect your credit card.
On the next page, enter the details of your credit or debit card and proceed back to the dashboard.
- Purchase your Bitcoin!
Press the “Buy/Sell” button to buy your Bitcoin as and when you please, using your card. Watch out though, there are purchase limits that you might have to lift with more verification and/or a good trading history!
The problems with purchasing Bitcoin and other cryptocurrencies only really pop up when you start to buy larger amounts. If this is the case, Coinbase asks you to verify your identity through a range of methods. The most popular is to take a photo of your ID document, like a passport. Thankfully, the Coinbase system works really well for this approval process — it’s literally taken me minutes before.
Storing Your First Bitcoin
Buying your first Bitcoin is actually the easy part, if you’ve ever bought anything else online — which you most certainly have! The tricky part of cryptocurrency ownership is the storage aspect, and that’s what we’re going to cover right now.
Where to Store Your Cryptocurrency
Storing cryptocurrencies like Bitcoin is a bit different from storing regular fiat currencies. You can store cryptocurrencies on almost any electronic device — your laptop, desktop, mobile phone, or even tablet — as well as with a handful of alternative methods, like storing them on an online portal or even on a piece of paper.
The basic premise of storing cryptocurrencies is that you have to protect a secret, password-like string of numbers and letters called your private key. Your private key is what gives you access to the cryptocurrencies you claim to own. If you lose it, you lose access to your cryptos, and if someone else finds it, they gain access to your cryptos.
Cryptocurrency wallets are designed to make your private key storage a safe and smooth experience. The easiest cryptocurrency wallets to use are online wallets — and in fact, Coinbase has a built-in online wallet. That’s right, you don’t even need to move your cryptocurrencies off of Coinbase to store them!
However, it’s advised that you do move your cryptocurrencies off of whatever exchange you purchased them from, so that you have complete access to them. The best places to store your cryptocurrencies are on your computer, with a verified wallet like Bitcoin Core, on your mobile phone, or on a hardware wallet — a specialist device for storing cryptocurrencies. For now, let’s look at the first of those three options.
How to Store Your Cryptocurrency
To store cryptocurrency on your desktop, Bitcoin Core is the wallet of choice. Simply download the wallet, install it, and you’ll be presented with a public address. This is like the bank account number for your cryptocurrencies.
Now, if you head back over to Coinbase, you’ll find an option to send cryptocurrencies in your wallet. Click that, and then you can input the public address from your Bitcoin wallet. Just hit send, complete any verification required, and congratulations: you’ve successfully transferred your first Bitcoin into safe storage.
Whatever method you choose for storing your cryptocurrencies, the steps are similar. You set up the wallet and get your public address, and then send your cryptocurrencies to that. Usage, of course, varies between devices and wallets.
That’s it — you’re done! You’ve successfully purchased and stored your first Bitcoin ever. From here, it’ll only get easier, and you can experiment with new exchanges and wallets to decrease costs and improve security.