Bitcoin is digital money, it has no physical expression in the form of notes and coins.
Bitcoins exist in the form of blocks — records in a registry distributed among computers on the network. Buying bitcoin means obtaining public and private keys to access the block. By buying bitcoin, the user receives the rights to act on it.
The bitcoin algorithm was created by Satoshi Nakomoto, an anonymous crypto enthusiast in 2008. On January 3, 2009, Nakomoto generated the first bitcoin block and received a reward for his work. The first block became the basis of a distributed ledger, the blockchain.
The blockchain, a chain of blocks, contains information about all bitcoin transactions. Every user of the network can read the information in the blockchain. The Bitcoin blockchain operates autonomously, protected by cryptographic encryption.
There is no ban on cryptocurrency transactions in the EU. Anyone can buy bitcoin from a cryptocurrency exchange, a private person or an ATM. These methods have their advantages and disadvantages.
1. OPTIONS FOR BUYING BITCOIN
Buy bitcoins on the exchange
Buying bitcoins from an exchange takes more time and requires additional transactions. Some exchanges do not accept fiat currencies, dollars or euros. To buy bitcoins from such exchanges, you need to use stablecoins, which are traded on an exchange.
Stablecoins are digital money backed at a ratio of 1 to 1 by fiat currency. Stablecoins are bought from companies that issue this type of cryptocurrency.
You need to register and open an account on the exchange before you can make any transactions. The account on the exchange is virtual; most exchanges charge a fee for deposits and withdrawals.
The bitcoin exchange rate is lower than that of the other cryptocurrency services.
Transferring funds from a seller's account to a buyer's account on an exchange takes more time than on an exchanger. In some cases, it takes two to three days to execute the order. Key transactions on cryptocurrency exchanges are available after a multi-step verification and identification. Due to such verifications, a high level of transaction security is achieved.
Buy bitcoin from an ATM
An easy way to buy bitcoin is to buy it from a specialized cryptocurrency ATM. You can pay for bitcoin at an ATM with a card or cash. The purchase fee is fixed and does not exceed 4%. The exchange rate is set by the provider at the time of payment. There are 14,000 cryptocurrency ATMs in the world. A number of them, 1,300 ATMs, are located in the EU.
Many digital currency ATMs are in the EU, but mainly in major cities.
Buying bitcoin from individuals
When you buy bitcoins from other people, you do not have to pay commissions. When buying, you should be aware of the risk of fraud. Transactions between individuals take place on special exchange platforms that accept ads to buy or sell cryptocurrencies from users from different countries. The service administration pays attention to transaction security and informs buyers about the seller's reputation through ratings and reviews, but there is always a risk of losing money when buying bitcoin from a private individual.
2. HOW TO STORE BITCOINS
Bitcoins, or more precisely their public and private keys, are stored using electronic cryptocurrency wallets, special programmes or devices. Electronic wallets can be:
- Software, on a personal computer
- In the form of an application downloadable on your smartphone
- On-line platforms
- Hardware, in the form of special devices for storing data
It used to be safer to store bitcoins using hardware devices and software wallets on personal computers. Standard digital security measures were sufficient.
But now, online platforms provide a higher level of security because all information is stored on powerful, fault-tolerant servers. Your device might break or get lost, then in the Cloud, your data is stored more securely.
3. HOW TO BUY BITCOINS FROM AN EXCHANGER
Let's look at how to buy bitcoin using the Broex service as an example.
The resource accepts payment from Visa/Mastercard.
It is also possible to pay via payment systems that work with the service. The purchase order is created in a simple and intuitive interface.
To make a purchase you need to:
- Register and verify with Broex.
- Select the currency pair you require.
- Enter an amount.
- Enter the card number and the buyer's data, first name and last name to identify the payment.
- After payment, the system sends the request to the operator for processing. Within an hour, you will receive the bitcoins to the wallet.
4. HOW TO BUY BITCOINS FROM EXCHANGE
Among the list of trusted cryptocurrency exchanges that trade bitcoins for fiat currency is one such exchange as Broex.
5. LET'S LOOK AT BUYING BITCOINS USING BROEX AS AN EXAMPLE
You can buy bitcoins for dollars or euros on the BROEX exchange. Registration on the exchange is done with an e-mail address. Many transactions on the exchange are available to users with the status "verified". The status "verified" is given to the user after verification of the questionnaire, which contains the passport data and the place of residence of the user.
After verification, the user will be able to deposit the account with a card, by sending dollars to his exchanger account. The account on the exchange is virtual. The bitcoins you received in your account during the exchange operation must be transferred to your wallet. Only then the user will have access to the private keys. For the transfer to the wallet, the exchange takes a commission from the user. At the BROEX exchange, there is a minimum of 0.01 bitcoins to withdraw.
There are some other advantages to this exchange:
- BROEX has the lowest commission for buying bitcoins
- Fast purchase process due to high computing power, which performs the necessary checks
- 100% secure online wallet
- Buying bitcoin at a fixed price the moment the purchase is initiated
These benefits make the exchange a great investment vehicle for novice investors. Follow the link and register in the system, a simple and intuitive interface will help you to understand quickly.
The cryptocurrency market is developing quickly and dynamically. Bitcoin's important property - the 21,000,000-unit issue limit - has given stock analysts reason to compare the first cryptocurrency to gold. Observations of the price dynamics of both assets confirm their similarity. Unlike gold, bitcoin is easy to store.
The number of companies accepting bitcoin as payment for their goods and services is increasing. Large financial institutions are showing interest in Bitcoin. The Chicago Mercantile Exchange has opened bitcoin options trading since January 2020.
When buying bitcoin, a novice crypto investor should keep in mind that bitcoin is subject to sharp fluctuations, a rise in price can be followed by a fall. The safety of funds invested in bitcoin is based on investor's constant monitoring of market conditions. Yes, Bitcoin has had its ups and downs throughout its history. But Bitcoin is constantly growing year by year. That is, it is still higher in December 2020 than it was in December 2019, even though its price dipped below December 2019 levels in the summer.
Investing in Bitcoin in the long term always yields only positive results.