How To Buy and Store Bitcoin

Bitcoin is the most popular cryptocurrency and the interest around this digital coin has been growing due to the increasing number of retails accepting them as payment. Bitcoin can be bought either from an exchange or transferred directly from an individual.

We will uncover below how to buy Bitcoin on an exchange and most importantly, how to store Bitcoin.

1. CREATE A BITCOIN WALLET

Before buying Bitcoin, it is highly advisable to create a Bitcoin wallet to store your digital assets. Similar to an ordinary wallet that is kept in your pocket – a wallet in cryptocurrency refers to a device or software application that can be used to receive, store or transfer Bitcoin and other cryptocurrencies.

a. Mobile App Wallet

There are many cryptocurrency wallet apps (online wallet) today that can be downloaded to your mobile phone of choice (Android or iOS) and carry it around with you easily. As long as you have access to the internet, you can access your app to review the latest updates on your digital assets storage and transaction history. Most of these mobile app wallets include QR code scanners so that transferring and receiving Bitcoin and other cryptocurrencies is a fast and seamless experience. However, these online wallets are easily accessible and more intuitive to use, you should consider to store in cold wallets once your assets worth are more valuable.

b. Ledger Wallet (Cold Wallet)

Cold wallet can be referred to offline wallet or Ledger wallet. These are hardware devices that can store private keys to access cryptocurrencies without the usage of the internet. The device is similar to the USB, whereby a hacker cannot access the files saved in a USB device because it is detached from the computer and the internet. Currently there are two Ledger hardware wallets: Ledger Nano S and Ledger Nano X.

Figure 1: Ledger Nano S Wallet (Credit: Ledger.com)

2. PREPARE PERSONAL DOCUMENTS

Once the wallet has been set up safely and securely, it’s time to buy Bitcoin! Most exchanges like Luno will require their users to verify their identity due to the Anti-Money Laundering Policy. Although you won’t be requested to present them when signing up, it’s usually required when you need to withdraw your cryptocurrency from your balance account in the chosen exchange.

The documents that are usually requested for: Driver’s License, National ID or Passport.

They may also ask their users to take a photo of themselves with the choice of ID and a paper written with a provided set of information. Ensure you have clear photos or digital copies of your personal documents or you are in a well-lit room to take photos of yourself with the personal documents, if needed.

3. STABLE INTERNET

Nothing is more frustrating than not knowing whether your purchase has gone through or not, especially when it comes to large sums of Bitcoin. You must check that your internet is stable and reliable to avoid lag in your purchasing process.

4. BITCOIN EXCHANGE

In this article, we will be using Luno as an example of a spot exchange to buy Bitcoin. Spot exchange refers to an online marketplace where you can exchange your currencies (usually from fiat to cryptocurrency like Bitcoin) based on the current market price of the currencies. 

a. Create An Account

Whether you are on a desktop or mobile, create an account.

b. Set Amount of Bitcoin to Buy

Once you have landed on the homepage, select the amount you wish to buy.

c. Deposit Fiat Currency

If you don’t have any money in your Luno exchange balance, they will request you to deposit money first via bank transfer. Once you have deposited, you may proceed to purchasing your Bitcoin based on the amount available in your Luno exchange account balance.

d. Cryptocurrency Balance

Once you have purchased your Bitcoin using the available fiat balance in your Luno account, you should be able to see all your currency balances under “Wallets”

e. Transfer Bitcoin to Your Bitcoin Wallet

Never keep your currencies in your exchange balances unless you are planning to purchase soon. To transfer your Bitcoin out of your Luno exchange to your wallet, click “Send.”

You will be asked to either transfer your Bitcoin via inserting a Bitcoin address or QR scan the QR code, which both can be found in your Bitcoin wallet.

QR Scan Your Bitcoin Wallet Address to Receive Bitcoin
Insert Your Bitcoin Wallet Address to Receive Bitcoin

Once the transfer is complete, you should be able to see your new balance in your Bitcoin wallet.

5. WHAT TO DO WITH BITCOIN

Now that you have Bitcoin, here are some ideas on what you can do with them!

  • Shop & DineHundreds and thousands of merchants now accept cryptocurrency as a form of payment such as Microsoft, Shopify Stores, REEDS Jewelers Inc, Lamborghini, Expedia, Newegg, KFC Canada, Playboy, Subway and more.  
  • Travel: Since cryptocurrency is not bounded by a specific national government, travelling with crypto helps users to save costs on money exchanges and reduce risk of getting robbed from carrying cash around.  
  • Trade: The booming market of crypto opened doors to multiple ways for people to potentially expand value of their assets. If you own a cryptocurrency, head over to www.testnet.bitorb.com to begin your derivatives trading journey.  

CONTINUE YOUR LEARNING

It is widely agreed that one of the impediments to mass-adoption of cryptocurrency is scalability.  Bitcoin’s highest transaction throughput…
Digital assets are digital representations of value facilitated by cryptography and distributed ledger technology.  They have their own units…
Previous
Next