Key Takeaways

• Bitcoin purchases can be made through brokerages, exchanges, and peer-to-peer marketplaces.
• Common payment methods for purchasing Bitcoin are bank transfers, credit/debit cards, and other cryptocurrencies. 
• Where to store purchased Bitcoin must also be considered; cold and hot wallets each have their pros and cons. 
• Staying up to date of industry developments and trends helps in making informed, safe decisions when participating in the cryptocurrency market.

Introduction

Bitcoin is a decentralised digital currency that can be sent directly from one person to another without needing a third-party intermediary. It’s powered by a network of miners who validate and secure transactions, and its transaction history is recorded on an immutable public ledger, called a blockchain. 

Learn what Bitcoin is, the system behind it, and the basics of navigating the original cryptocurrency. 

Where to Buy Bitcoin

Those interested in joining the Bitcoin community have several options when it comes to making their first purchase: 

• Brokerages are an intermediary between buyers and sellers, providing an efficient platform for building a cryptocurrency portfolio. They often provide other financial services. The Crypto.com App is a brokerage utilised by over 80 million users. 
• Centralised exchanges (CEXs) allow users to trade digital currencies with one another. They typically offer advanced features, such as leveraged or automated trading, for experienced cryptocurrency users or institutions. A notable example is the Crypto.com Exchange, which supports popular Bitcoin trading pairs. 
• Decentralised exchanges (DEXs) let users buy and sell cryptocurrencies without a third-party service provider, which means users are responsible for managing their private keys. For example, the Crypto.com DeFi Wallet is a non-custodial app where users can store and purchase digital assets, plus access decentralised apps (dapps). 

For more about the differences between centralised and decentralised cryptocurrency platforms, read What Is a Crypto DEX?

Steps to Buy Bitcoin

For most cryptocurrency platforms, like the Crypto.com App, the first step is creating an account, which requires providing an email address and phone number, plus completing identity verification. This KYC (know your customer) process varies by jurisdiction but usually involves submitting a valid form of identification. 

Once the identity documents are verified, it’s time to decide on a payment method. Frequently accepted are fiat currencies, credit/debit cards, Apple Pay, Google Pay, and other cryptocurrencies, depending on the cryptocurrency platform and user region.

Visit the Help Centre for comprehensive guides on buying cryptocurrency.

Bitcoin Buying Strategies

There are different strategies amongst traders on how and when to buy Bitcoin. Below are two important ones to know:

Buying at the Lowest Price

Traders who employ this strategy try to ‘time the market’ and buy Bitcoin at the lowest price. On some cryptocurrency platforms, this can also be automated, so that the user does not need to constantly monitor the price. This can be helpful insofar as — let’s not forget — cryptocurrency trades 24 hours a day, seven days a week.

For example, the Target Price feature in the Crypto.com App allows users to place Buy and Sell Orders for Bitcoin when it hits a set price. If the market conditions are right, traders can buy Bitcoin at their preferred, lower price and later automatically sell it at a higher price without having to track its price movements. 

Dollar Cost Averaging

If the buyer is looking to HODL, then the entry price may not matter as much, and buying a lump sum of any asset can be risky. To minimise the risk of price fluctuations, buyers can consider adopting the Dollar Cost Averaging (DCA) strategy, which involves purchasing smaller amounts of Bitcoin at regular intervals over time. 

For example, the Recurring Buy feature in the Crypto.com App lets users do just that. 

To learn more about Bitcoin trading, check out our introductory article.

Storing Bitcoin and Bitcoin Wallets

Another decision to make when buying Bitcoin is how it will be stored. There are two main types of Bitcoin wallets that fulfil this purpose: hot wallets and cold wallets.

Hot wallets are connected to the internet, making the user’s cryptocurrency more accessible on a daily basis, whether for spending or trading. Security, regulatory compliance, and privacy should be top of mind when deciding on a hot wallet provider. 

Cold wallets are physical, offline devices that hold the private keys used to access the cryptocurrency. They are not vulnerable to software attacks but may not be suitable for beginners. Learn more about the pros and cons of these hardware wallets and what to consider.

Read our essential security tips on how to keep Bitcoin, wallets, and accounts safe.

Selling Bitcoin

After acquiring Bitcoin, holders want to make sure they always have the option to easily sell it for other cryptocurrencies or fiat currencies. In cryptocurrency trading, this is also called an off-ramp — the option to convert crypto back into fiat currency. Reputable platforms allow users to sell their Bitcoin for fiat at any time — commonly either by bank transfer or paying it back onto a registered credit/debit card. Before buying Bitcoin on any platform, it’s a good idea to check the platform’s off-ramp options.

For detailed guides on how to sell Bitcoin and other cryptocurrencies on Crypto.com, visit the Help Centre.

Final Words — Buying Bitcoin for the First Time 

Acquiring Bitcoin for the first time is an exciting process. Before proceeding, it’s crucial to consider the risks and conduct thorough research. Staying up to date with industry developments and trends aids in making informed decisions when participating in the cryptocurrency market. Additionally, following news outlets and regulatory changes gives insight into how prices might be affected.

Due Diligence and Do Your Own Research

All examples listed in this article are for informational purposes only. You should not construe any such information or other material as legal, tax, investment, financial, cybersecurity, or other advice. Nothing contained herein shall constitute a solicitation, recommendation, endorsement, or offer by Crypto.com to invest, buy, or sell any coins, tokens, or other crypto assets. Returns on the buying and selling of crypto assets may be subject to tax, including capital gains tax, in your jurisdiction. Any descriptions of Crypto.com products or features are merely for illustrative purposes and do not constitute an endorsement, invitation, or solicitation.

In addition, the Crypto.com Exchange and the products described herein are distinct from the Crypto.com Main App, and the availability of products and services on the Crypto.com Exchange is subject to jurisdictional limits. Before accessing the Crypto.com Exchange, please refer to the following links and ensure that you are not in any geo-restricted jurisdictions for Spot Trading and Margin Trading. 

Past performance is not a guarantee or predictor of future performance. The value of crypto assets can increase or decrease, and you could lose all or a substantial amount of your purchase price. When assessing a crypto asset, it’s essential for you to do your research and due diligence to make the best possible judgement, as any purchases shall be your sole responsibility.