Thinking about adding Bitcoin to your portfolio?
These days, you can buy and sell Bitcoin (BTC) on quite few crypto exchanges, so keep reading for step-by-step instructions on how to start trading this most popular crytocurrency.
What's in this guide?
- QUICK GUIDE: HOW TO BUY BTC
- A Step-by-Step Guide to Buying Bitcoin
- How to Sell BTC
- How Bitcoin Works
- Which Wallets Can I Use to Hold Bitcoin?
- Things to Consider When Buying Bitcoin in the UK
- Final words
A decade ago, the thought of paying for goods and services with Bitcoin would have seemed like a big task. At the unveiling of the cryptocurrency during its first-ever whitepaper, no one seemed to take it seriously.
But right now, it feels those who do not have Bitcoin are missing out on a big opportunity in this digital world. There are several places where Bitcoin is now accepted. Moreover, the price of Bitcoin keeps skyrocketing, which has attracted both small and major traders.
Yet, not everyone knows where to go or how to buy Bitcoin. If you are in this category of people, we are here to help you. Buying Bitcoin in the UK is not as difficult as it seems, despite the stringent laws on digital assets in the country.
Several exchanges are willing to introduce you into the industry as long as you have the requirements, which are not difficult to get. Once you have a payment method with funds, have an internet connection, and can provide certain information, you can easily buy Bitcoin and store it or trade with it.
There are three basic steps you need to follow when buying Bitcoin in the UK.
QUICK GUIDE: HOW TO BUY BTC
- Register for an account with a cryptocurrency exchange like eToro.
- Verify your account.
- Go to the deposit section
- Go to the platform and select Bitcoin.
- Enter how much you want to buy.
- Check the details and confirm your purchase.
A Step-by-Step Guide to Buying Bitcoin
Set up an account with an exchange that supports Bitcoin in three steps:
Step 1: Open an Account with a Cryptocurrency Exchange
You can buy Bitcoins at major cryptocurrency exchanges in the UK. If you want to buy other cryptocurrencies, you can buy Bitcoin and exchange it for other cryptocurrencies as well. But the first step is usually buying Bitcoin.
There are lots of cryptocurrency exchanges in the UK you can select and register with. Signing up at one of them will allow you to buy Bitcoin, trade it, or even sell it at a later date when its price increases.
Different exchanges have their registration guidelines, but they are very similar. Most of them will require you to fill a Know-Your-Customer (KYC) form as a prerequisite for registration. This is because of the laws the government has put in place to curb money laundering.
Also, some exchanges allow you to withdraw your purchased Bitcoin to your Bitcoin wallet, which will be necessary if you are keeping the Bitcoin for a long time.
Many exchanges do not have provisions for such, so you need to do thorough research here. Read their requirements and policies before registering. But you may not need a Bitcoin wallet if you plan on trading Bitcoin consistently.
Once you have provided the basic information and agreed to their terms, you will be allowed to continue.
Step 2: Deposit Funds into your Account
When registering with a Bitcoin exchange in the UK, they may require you to submit personal information like driver’s license, social security number, and information about your source of funds.
The next step is to load funds into your exchange account. Here, you may be asked to provide bank account details or credit card details, depending on the payment method you choose. The step is as simple as making online payments.
Step 3: Buy Bitcoin
After depositing funds to the cryptocurrency exchange, you are ready to start buying Bitcoin.
At the order section of the exchange, you will see lots of options, depending on how you want to invest the Bitcoin.
Also, there are lots of Bitcoin pairings on exchanges, depending on your base currency. Go to the buy section of the exchange and choose the cryptocurrency you want to buy. In this case, you are choosing the Bitcoin option.
Enter how much Bitcoin you want to buy. The price of Bitcoin at the latest market rate is usually displayed to help you know how much you need to spend. Double-check your transaction details before submitting your order. It’s as simple as that!
How to Sell BTC
Selling Bitcoin is also not difficult. The process of selling Bitcoin is similar to the buying process but even less demanding. All you need is to log in to your exchange and choose the Bitcoin pair you want to trade. The “Sell” tab gives you the space to enter your transaction details, including how much Bitcoin you are selling.
Review the transaction and click the “Sell Bitcoin” button. It’s that simple!
How Bitcoin Works
Despite the increased popularity of Bitcoin, many people still don’t understand the concept of Bitcoin.
The cryptocurrency was indeed born out of blockchain technology, which is somehow technical to understand.
But to put it simply, Bitcoin is a type of cryptocurrency and is not owned by anyone. It is a decentralized ledger where balances are kept, with everyone having access to the ledger. All Bitcoin transactions are verified by an enormous amount of computing power, where every transaction is transparent and viewed by everyone in the ledger system.
Bitcoin is not a legal tender as it is not owned or generated by any government or backed legally as a currency. But the cryptocurrency is now very popular. People can trade Bitcoins on exchanges and exchange them with fiat currency.
Which Wallets Can I Use to Hold Bitcoin?
There are two types of wallets you can use to store your Bitcoin: the cold (offline) and hot (online) wallet. The former is used when you want to hold your cryptocurrency for a long time.
The cold wallet can be stored in hardware or a storage device and kept physically safe. On the other hand, the hot wallet is an online storage capacity for your Bitcoin. Several crypto exchanges and custodians offer hot wallet storage services.
Things to Consider When Buying Bitcoin in the UK
As a newbie to the world of Bitcoin and cryptocurrencies, there are things you should understand before investing in Bitcoin.
Bitcoin is Very Volatile
The volatility of Bitcoin is unquestionable. However, some people don’t know just how volatile it is until trades start going highly against them.
So, before you enter the Bitcoin market, have that mindset that things might turn south pretty fast. In the same way, your Bitcoin may produce a much higher return within a short time than you expect. The volatility of Bitcoin goes both ways.
You can lose all you have invested or gain massively. But it’s always better to prepare for the worst than to be cut off-guard.
You may Need a Cryptocurrency Wallet
As we stated earlier, this is not necessary if you’re not planning to store your cryptocurrency for a long time. If you want to go into active Bitcoin trading, you should skip this step, because the crypto exchange you registered for will serve as your wallet when you’re trading.
But a crypto wallet is for anyone who wants to maintain full control over their Bitcoin funds. You can withdraw from a peer-to-peer group, ATM, or from an exchange to a personal crypto wallet and hold your wallet’s private keys.
The wallet key provides access to the funds and allows you to receive payments and gifts. However, you need to keep the key confidential. You can install the wallet on your iOS smartphone, tablet, or Android phone.
Protect your Wallet Key
If you are storing your Bitcoin in a wallet, it’s important to keep your wallet key secure. Unlike bank accounts for fiat currencies, Bitcoin wallets are protected by a digital key.
If that key is lost or forgotten, it may be very difficult to claim the funds in that wallet. If you want to take control of your Bitcoin, it’s important to secure your wallet key.
So many Bitcoin holders have lost fortunes due to forgotten or lost keys.
Buying Bitcoin in the UK has never been easier than now. The process is straightforward without any hassles.
If you’re new to Bitcoin and cryptocurrencies, the best place to start your investment journey is to buy at an exchange. The above guide provides a step-by-step process to help you achieve that.
eToro – Best UK Platform to Buy Bitcoin
eToro have proven themselves trustworthy within the crypto industry over many years – we recommend you try them out.
Virtual currencies are highly volatile. Your capital is at risk.