If you are reading this: you must have recently heard about bitcoin, or you have finally decided to buy your first bitcoin. In this article, we provide a step-by-step guide on how to buy your first bitcoin.
Bitcoin is the first and most popular cryptocurrency in the world. It is popular for several reasons, including its price hike in 2017, use cases, and technology built around it.
Buying your first bitcoin is a simple process, as explained in this article.
- Get a bitcoin wallet eg. Hardware wallets
- Sign up on a Bitcoin marketplace eg. Paxful
- Purchase bitcoin with cash eg. bank transfer, mobile money, PayPal.
- Move your bitcoin to a wallet you control or start using bitcoin.
Step 1: Get A Good Bitcoin Wallet
Before you buy your first bitcoin, you will need to get a wallet. Bitcoin wallets are applications that allow users to receive, send, and store their coins. There are different types of bitcoin wallets you can choose from, as reviewed in our top bitcoin wallets list.
It is best practice to select non-custodial wallets, which are wallets that give you total control of your funds. They provide you with a ‘seed phrase’ that allows you to back up your wallet and move from one wallet provider to another.
There are two types of wallets you can choose from – hardware wallets and software wallets. Software wallets are free applications available on mobile and desktop. On the other hand, hardware wallets are special devices made for storing cryptocurrencies. They are safer than software wallets since funds are kept offline and are only connected to the internet when you have to make a transaction. Their nature reduces risks like hacking and phishing attacks. Ledger Nano S is an example of a good hardware wallet.
After you have selected your wallet, you will now have to select a platform to buy your first bitcoin.
Step 2: Select A Bitcoin Marketplace – Paxful
Different platforms make it possible for you to purchase your first bitcoin. You can choose between brokers, exchanges, and Peer-to-Peer (P2P) marketplaces.
New users mostly prefer P2P marketplaces since they have lesser restrictions and support multiple currencies and payment methods. One of the largest bitcoin P2P platforms is Paxful.
Paxful has been around for five years and has a userbase of over 4.5 million people who have made over 44 million transactions. The P2P marketplace supports more than 300 different payment methods, including bank transfer, mobile money, gift cards, and PayPal.
Paxful is available in most parts of the world. For instance, in Africa, Paxful supports trading in all countries except Burundi, Central African Republic Sanctions, Libya, Somalia, South Sudan-related Sanctions, and Sudan.
With several payment options available when you want to buy your first bitcoin and its availability in several regions, Paxful is an excellent exchange for new users.
Step 3: Purchase Bitcoin – Payment Methods
To purchase bitcoin on Paxful, you will need to create an account (readers who use our referral code ‘KadE2nbpZYp’ get $5 in BTC at the end of their first month provided they verify their account and make at least one trade).
After, you will need to verify your identity to have full access to all features on Paxful. You will need a viable identification card to complete this step.
Once you complete the verification, you can buy your first bitcoin on Paxful. On the homepage, enter the amount of bitcoin you want to purchase in your local currency, and you will see how much bitcoin you will receive based on the conversion rate.
Select a payment option and click the ‘Search Offers’ button. A list of offers from several sellers will appear, you can select any to trade with.
When selecting traders to purchase from, there are few things to look out for:
- The number of thumbs up (positive feedback).
- Preferred payment option.
- Cash buying limit displayed in your traditional currency.
- Average trade time.
After checking all these and selecting a seller, click ‘Buy’ follow the prompts. Ensure that you click ‘Paid’ after you send the money. The seller will confirm they have received the cash and release the bitcoin to your wallet.
Now that you have bought your first bitcoin, you can move your fund to your wallet if you intend to hold for a long time. You can also look into ways to spend your bitcoin online and make payments in the real world.