The process of buying bitcoin has never been easier
“Buy bitcoin.” You hear that phrase more often now than ever before. So how do you do it? Well, it’s simple.
Buying bitcoin can be done privately, via less formal over-the-counter (OTC) deals, or through large centralized exchanges like OKCoin.
The main benefit in dealing with an exchange versus the OTC market where buyer and seller come to terms one-to-one, is the added comfort of customer support and the secure nature of the exchange platform.
These are key elements that make using exchanges for buying Bitcoin the mainstay approach for most retail investors. And the process at OKCoin is an easy three steps: verify your profile, add a valid bank account and start trading. That’s it.
Buy bitcoin with a credit card
To buy bitcoin, you first need a wallet to hold it. Bitcoin wallets contain a public and private key, providing access to a unique Bitcoin address. From your wallet you can store, transfer or withdraw your bitcoins.
You can generally group bitcoin wallets into two camps: software and hardware. Both types have their advantages and disadvantages, most especially in terms of security.
Software wallets come in three forms, desktop, mobile and online. Because most software wallets are always connected to the internet, they are considered ‘hot wallets’ and therefore are less secure than owning a designated hardware-based device.
Hardware wallets are considered secure because they don’t have to be connected online at all times. As such, hardware wallets are labelled cold storage and there are a number of quality options available on the market.
Today, a trader can buy Bitcoin with cash (Bitcoin ATM or privately) and via traditional payment methods such as a debit card or bank transfer. Buying bitcoins with cash or a cash deposit is of course the most private method for purchasing bitcoins.
Large exchanges like OKCoin also accept credit card payment to buy bitcoins, depending on your location. Buying bitcoin on credit may result in transaction fees you wouldn’t otherwise incur, however the process is both instantaneous and convenient.
Identity verification may be required
In order to buy and sell bitcoin via an exchange based in the U.S. or Canada, in most cases, you will need to verify your identity in some capacity. This is usually done via submission of personal documents, including a driver’s license and Social Security number (SSN) or your Social Insurance Number (SIN) in Canada.
This above-board approach to cryptocurrency trading is the only path forward if digital currencies are to become fully legitimized and embedded in mainstream society more so than they already are.
Anti-Money laundering rules and legislation, along with current fundamental requirements in financial services like Know-Your-Customer guidelines, is the benchmark standard.
The U.S. Securities and Exchange Commission’s Chairman Jay Clayton stated in 2019 that Bitcoin and Ethereum were not securities, but replacements for sovereign currencies.
Nevertheless, the legal standing and taxation status still remains uncertain. Before you buy bitcoin you should review your local legislation.
If you want to learn more about how to buy Bitcoin, or are concerned with compliance and regulatory issues surrounding cryptocurrency trading, reach out to OKCoin today and an expert will be available to help guide you through the process.