Are you ready to start buying Bitcoin? Are you looking for a better way to buy cryptocurrency that’s faster and costs less? There’s a lot to know about entering the cryptocurrency market. Crypto buyers outside of the United States, in particular, can have a tough time finding a cheap, fast way to buy Bitcoin.
Whether you’re new to crypto or looking for better options, these are the 8 things you absolutely have to know before you buy Bitcoin:
#1 Go with a Local Cryptocurrency Exchange:
The major exchanges are almost all based in the United States and make it easy for American buyers. If you’re buying Bitcoin from outside the US, you want to go with a respected local cryptocurrency exchange so that you can avoid paying exchange rate fees.
If you’re in Canada, Canadian cryptocurrency exchanges like Bit buy are a great place to start.
#2 You Will Have to Prove Your Identity:
Cryptocurrency exchanges rely on KYC (Know Your Customer) to keep cryptocurrency above board. The first time you buy Bitcoin will generally take longer than any subsequent transactions because you will have to prove your identity. This helps exchanges prevent money laundering and stops cryptocurrency from being used to fund criminal activities or terrorism.
#3 Don’t Use your Credit Card:
If you can use Interac e-Transfer or make a deposit on an exchange directly through your bank account, do it. Using a credit card can come with very high fees, as high as 10%. Credit card companies have also started processing these transactions as cash advances, raising costs even more dramatically.
#4 Read the Reviews:
Read the reviews online to find out whether a cryptocurrency exchange has good service, quick transaction times, and low fees compared to the competition. It always pays to know who you’re dealing with in cryptocurrency.
#5 Use a Cryptocurrency with Good Bank Relationships:
Good cryptocurrency exchanges speed up transaction times and reduce fees by establishing good relationships with the banking system in your country. In some places, major banks have proven skeptical about cryptocurrency. Banks can wind up holding transfers if the exchange hasn’t established good relationships.
#6 Get a Security Wallet:
You can hold cryptocurrency on most exchanges securely, but ultimately the most secure way to store cryptocurrency is in your own wallet. Do your research into online and offline (or hot and cold) wallets and find what works best for your purposes.
#7 Find Out if You Have to Pay Taxes:
Bitcoin is not immune from taxes in most countries. You may need to pay capital gains taxes when you sell Bitcoin and withdraw fiat currency. Talk to an accountant or do your research online before you sell Bitcoin.
#8 Cryptocurrency Prices Can Be Volatile:
Treat Bitcoin like any investment in a commodity or stocks: the market can go up and the market can go down. Only invest money that you’re willing to lose, especially when you first start.
These are the 8 things you need to know when buying Bitcoin in order to get your cryptocurrency quickly and at the lowest possible fees. Go with a cryptocurrency exchange that works with the banking system where you live, especially if you’re buying Bitcoin outside of the United States, don’t use a credit card, get a wallet, don’t forget the taxes, do your research, be prepared to prove your identity, and keep price volatility in mind.