A Question of Scale
Buying Bitcoins is similar to buying any other kind of fiat currency. There are many ways in which you get to exchange US dollars for Japanese Yen or Mexican Pesos. For small amounts of cash, you can probably find a friend to exchange a few dollars for the currency you need.
For moderate amounts, you can visit a foreign currency exchange shop, like the ones you seen in international airports. Exchanging currencies in these shops is convenient, but they charge high fees. But if you want to exchange huge volumes, like thousands of dollars and do not want to pay high fees, you need to register an account at a currency exchange. All of this applies to Bitcoins as well.
You can purchase Bitcoins locally, from your friends or from the people who hold Bitcoins in your area. This method is preferable if you are buying Bitcoins in a smaller amount. If you are willing to buy relatively more Bitcoins, you can buy them from Bitcoin agents. These agents exist both online and operate in brick-and-mortar stores.
But if you are will to purchase in huge volumes, you can get them from major Bitcoin currency exchanges. An important thing to remember is that whenever you buy Bitcoins, you are buying them from someone who already owns them. Bitcoins are not directly sold, or there is no central exchange issuing them. Hence, no single individual or institution sets the price of a Bitcoin. Its price is decided collectively by those who buy and sell them on a daily basis.
There are a lot of options when it comes to buying Bitcoins. For example, there are currently close to 4,714 Bitcoin ATMs in most of the countries across the globe. BTC, being the most popular crypto, has a lot of buying options. This is also because of the wide acceptance of BTC in a lot of places and on the internet as well. But with respect to other less popular cryptocurrencies, it is not this easy to buy them. You can buy BTC using cryptocurrency exchanges, investment trusts, gift cards, etc.
The Three major ways to buy Bitcoins
The easiest way is to buy through middle man companies. Middleman firms make money helping out people buy bitcoins easily, with minimum hassle.
These firms are also known as Bitcoin exchange intermediaries, and they have excellent customer service. Here, you don’t have to understand any of the processes that go behind in buying the Bitcoins. Like all middlemen services, they charge a convenience fee for their service.
These intermediaries consist of firms that have already registered their own accounts on one or more Bitcoin exchanges and will buy bitcoins on your behalf. The paper work involved is minimal here, and the time taken is also very low. The fees range from 1% – 10%, which are huge, but the service and customer support are often better than with exchanges.
You should try choosing a firm that charges the lowest fees and offers the best user experience. Be sure to check online for reviews of these services and try to figure out if they have a good reputation in the Bitcoin community before making your decisions. Many of these services operate only in limited regions, so some might not be available for you.
The efficient way to buy bitcoins is to buy them from any cryptocurrency exchange directly. These exchanges directly connect buyers and sellers of bitcoins using an advanced currency exchange system.
These exchanges are a bit complex, and the buying process can be confusing for a beginner. However, these crypto exchanges are where vast volumes of Bitcoin buying and selling happen. Hence, these exchanges usually offer the best prices for buying bitcoins. Also, by buying directly from an exchange, you minimize the number of parties involved in a large purchase, which reduces the risk of problematic transactions.
For large Bitcoin purchases (anything more than $5,000 worth of Bitcoin), it is recommended to do it directly with the exchange instead of using other methods. Using an exchange is also the right choice for very smaller purchases, as long as you have the time and interest to learn how a cryptocurrency exchange works. Major Cryptocurrency exchanges where you can buy Bitcoin include Coinbase, Kraken, Ploloniex, etc.
The most fun way of purchasing bitcoins is to buy them directly from the folks in your area who holds Bitcoins. Person-to-person exchange is fun because you get to meet others interested in this currency. Obviously, this way is not secure, and trading money directly with strangers might make some people very uncomfortable. But most Bitcoiners & Cryptonizers believe that person-to-person purchases are the wave of the future. Some wish for a more decentralized world in which huge corporations become outdated as technology makes it practical and convenient for people to interact directly. So, hopefully, face-to-face exchanges will become the most efficient, cheapest, and the fastest way to buy bitcoins in the future.
LocalBitcoins is a Finland based company that allows you to meet the people in and around your area and buy Bitcoins from them in your domestic currency. You can either meet them in person or can pay online if you wish to. https://localbitcoins.com/, you can follow this link and understand the procedure. It’s pretty straight forward.
These are some of the different ways through which you can buy Bitcoins. Convenience, security, and privacy are some of the essential things you need to keep in mind while you buy Bitcoins or any Cryptocurrency. With the advent of modern technology, the process of buying Bitcoins is getting more convenient with time. So we never know what new technology can come and disrupt all of these methods and make buying Bitcoins even simpler and easier.