Buying bitcoin can be a difficult experience – which exchange or service to choose is not always a clear choice. Some services have simple interfaces with high fees, some accept credit cards, some require wire services, and many have confusing and strict needs for identity information.
On top of that, it’s not always clear whether you’re getting a good deal on the bitcoin you’re buying. Some highly convenient services, like Bitcoin ATMs, will charge up to 7% to buy just $20 worth of Bitcoin!
After going through many of these pains ourselves (and overpaying more than a few times!), we’re glad to have found this guide to buying bitcoin cheaply.
There are two main sellers of bitcoin to consider:
What is a Bitcoin Broker?
Bitcoin brokers are sellers of bitcoin that typically have an easy user experience and support many different types of payment methods. They will walk you through everything step by step to help you get your first bitcoin, and many will even allow you to use a credit or debit card to make the purchase. Brokers usually have an app as well, making the process of buying bitcoin simple for everyone. Some brokers, like Swan Bitcoin, also support ongoing transactions so you can effortlessly save and ‘stack’ bitcoin for the long term.
However, brokers usually charge slightly higher fees. They are not the cheapest way to buy bitcoin, but their convenience often makes up for it.
What is a Bitcoin Exchange?
A Bitcoin exchange is a place where buyers and sellers of bitcoin meet to transact. These companies are like the NASDAQ or the New York Stock Exchange, but for digital currency. Exchanges are different from brokers because they operate an “order book” where customers can place buy or sell orders and be matched with other buyers and sellers. Brokers simply place their customers’ orders on the order books of various exchanges.
Exchanges sometimes have complex interfaces, where customers must know how charts, order books, and order types like ‘limit’ and ‘market’ orders work. This doesn’t take too long to learn, but it can be confusing or downright frustrating.
For the learning curve you must walk to make transactions on an exchange, you do get access to much lower fees. Some exchangeslike Coinbase operate both a broker and an exchange – their broker is coinbase.com whereas their exchange is pro.coinbase.com. Just by using the exchange you can save more than half off in fees.
Where do I Buy Bitcoin Cheaply?
The best place for you to buy bitcoin cheaply depends on your willingness to spend time learning about trading interfaces. If you have some time to space, choose a Bitcoin exchange. However, if you want the easiest possible experience, there are some low-fee brokers to choose from.
Once you make your purchase, don’t forget to learn how to custody your bitcoin yourself by taking it off the exchange and on to your own wallet. There are many wallets to choose from, from free phone-based wallets to highly secure dedicated hardware wallets.
Do you want to know what are The Best Cryptocurrencies for Online Payments? Click on the link and check out that article. Good luck out there and enjoy your Bitcoin journey!