If you want to start trading BTC but don’t know how to, this post is for you. You will be able to learn all the basics and start trading efficiently by the time you finish reading this article. We’ll talk about how Bitcoin mining works and what it means for Bitcoin traders, ways of trading it, and tips on not losing money in the market. It is one essential read for anyone starting.

What is Bitcoin?

Bitcoin is a cryptocurrency, also known as a digital currency or crypto. It’s money that only exists electronically in the form of cryptographic codes. During the economic breakdown, Bitcoin was invented by an anonymous group of developers back in 2009. The idea behind Bitcoin was to build a global money system outside the control of governments and banks.

How to Start Buying BTC?

Choose A Crypto Trading Service Or Venue

There are many different cryptocurrency trading platforms, also called exchanges, where you can start trading. There are usually two ways of buying Bitcoin: with fiat money or another cryptocurrency. In most cases, there are different fees for each of these options. Bitstamp and Coinbase have meager fees and good reputations, so we’ll use them as examples for the following sections. We’ll also use BTC as the currency to buy Bitcoin since it’s the most common cryptocurrency.

The easiest way to buy BTC with fiat money is to go to a Bitcoin exchange. You can find many of them on Bitstamp.com, Coinbase, Kraken, and ShapeShift. The best idea is to read their terms and conditions, so you know the ins and outs of each service. Most of them also have a verification process, which usually includes proof of ID, an address, and a phone number; some even require proof of residence or other documentation.

Connect Your Exchange to a Payment Option

To make buying BTC easier, you must connect your exchange account to a payment option. It is usually done through an API or other form of integration. If you don’t know how it’s done, ask the support on your exchange service. It’s usually straightforward and takes just a few minutes. This method allows you to deposit money in your exchange account and immediately trade crypto for crypto, which we’ll discuss below.

Many exchanges offer both fiat deposits and bank transfers. You can deposit through your bank’s website and instantly start trading. Depending on the payment method, you usually have to wait until the money gets into your account. Linking your exchange to a payment method might take a few days.

Place An Order

You’re ready to place an order once you’re done with the transaction.

Place a buy order by specifying the amount of BTC you want to buy and the price at which you think the price will go up in the future. Remember that when placing an order, Bitcoin is usually volatile, and prices change rapidly. Orders are usually submitted for funding on Bitstamp, so there is no fee for placing them. However, there are fees for placing a limited order, which is the fee you pay when you get filled by your order. Usually, this fee is 0.3%, but it can sometimes be higher. For example, if the price of Bitcoin goes down, it’s better to sell BTC quickly to avoid losing money on orders with a high fee.

Safe Storage

Once you buy Bitcoin, it’s essential to keep it safe. Bitcoin transactions are irreversible: you can’t take back your money if you lose your private key. On the other hand, once your private key is stolen/hacked, you can’t do anything about losing BTC. It’s essential to store your crypto securely in a wallet that allows cold storage, a “cold wallet.” A cold wallet isn’t connected to the internet, so it’s harder for hackers to access it.

Many cryptocurrency services allow you to store your BTC on their servers.

Hot Wallets: If you keep your funds on an exchange, your funds are at risk when the exchange goes bankrupt. In that case, you will lose all your crypto. If you keep funds in a hot wallet and it is hacked, you lose only the amount of BTC on top of the current market price. It is usually relatively small, and it isn’t bad news if you lose a few thousand USD worths of crypto.

You can access hot wallets from any device. It is a good option if you want to use the same wallet on your computer and smartphone. If you have a lot of crypto on your hot wallet, it’s a great idea to set up 2-factor authentication to access the wallet.

Cold Wallets: As stated earlier cold wallet is a wallet that isn’t connected to the internet. Your crypto is stored offline and on a hardware device that isn’t easy to access. Again, these are very hard to steal because hackers must break into your hardware wallet to steal your crypto. The best hardware wallets are Trezor and Ledger Nano S. You can store up to six cryptocurrencies on both devices, including BTC. Yes, it’s possible.

If you want to know more about this topic, I recommend reading online wallet reviews and hardware wallet reviews before making your choice.

Bottom Line

Buying Bitcoin is not complicated, but it does require some research and experience. Learning how to buy BTC is important since this will enable you to know how to trade crypto for crypto, so you can start trading. The best option is to buy a small amount first. Starting slow and getting used to the trading process is always better. The process described above is simple, safe, and secure. It’s easy to understand and can help you start your adventure in the BTC world.