Looking to buy bitcoins but confused about the best way to purchase bitcoins? Look no further for we have got all of your needs covered in this article. If you are looking to buy bitcoins then there are a few pre-requisites that you will need to fulfill first. You will need your own digital bitcoin wallet for making transactions, preferably a secure internet connection and access to a bitcoin exchange. You should also check up with your local regulations to make sure that you are legally allowed to buy and sell bitcoins in your jurisdiction.
Once you have met these pre-requisites, you can move on to the next step of looking for the easiest way to buy bitcoins. The easiest way to buy bitcoins is a relative matter because many factors come into play in making this choice, such as:
- Cost of transactions
- Processing speed
- Data sharing
- Accessibility
The easier it is to purchase bitcoins the costlier it will be, similarly if you are looking for quick processing times then you will have to pay a higher rate. If you are not worried about data sharing with regulatory bodies then you may get cheaper rates but if you want to remain anonymous then you will have to pay a premium for it. So let us now assess the methods of purchasing bitcoins on these 4 factors.
Credit or Debit Card
Credit or Debit cards are simply the most frequently used method to buy bitcoin instantly, and they are certainly the easiest and fastest method at present.
- Cost of Transaction: The fees charged on credit or debit cards is very high. Although the rate may vary slightly with the exchange you prefer to use but more or less the rate on each purchase is going to be over 3% and in some instances may even be as high as 6%.
- Processing Speed: The processing speed when it comes to purchasing through cards is the fastest out of all the methods. Bitcoins will be transferred into your digital wallet the moment your payment is approved. There is absolutely no waiting time involved here.
- Data Sharing: If you purchase bitcoins through your cards then your bank will share your data with the relevant regulatory bodies in your jurisdiction. This is standard protocol for all banks now. The nature of cryptocurrencies is such that they cannot be regulated but governments can use banks which usually serve as the point of origin for the bitcoin trail to document the details of people who use the banking channels to purchase bitcoins. Most people do not have any issue with sharing their data with the government, so if you are fine with it then this should not be a problem but some people prefer not to share their holdings in bitcoin with the regulatory authorities and such people may not use any banking channel to purchase bitcoins.
- Accessibility: Cards are readily accessible, if you have got a card and live in a country where bitcoin purchases are legal then you can make the transaction with ease.
So, cards are probably the easiest way to purchase bitcoins if you do not fuss over the cost of transaction and data sharing.
Bank Transfer
Bank transfer is not the fastest way to purchase bitcoins but it surely is the safest and the cheapest way to purchase bitcoins.
- Cost of Transaction: The rates that you may be charged if you buy bitcoins through your bank will be around 1.3%, almost half compared to the rates being charged on cards.
- Processing Speed: When it comes to processing speed, banks are no way near to the speed of credit cards. If you live in the USA and use ACH (Automatic Clearing House) transfer then your transaction may take at least five working days to process and if you live in Europe and purchase bitcoin through SEPA transfer then your transaction will take at least three working days to process.
- Data Sharing: If you use any banking channel to purchase bitcoins then your data will be shared with the regulatory authorities.
- Accessibility: Banks are one of the most accessible methods of purchasing bitcoins. If you live in a country that does not prohibit the purchase of bitcoins then you should not have any problem with purchasing bitcoins through a bank transfer.
Bank transfer is probably the cheapest way to purchase bitcoins but it is slower than all of the other methods.
Cash Transaction
Cash transactions are common among those who are not too keen to share their data with the regulatory authorities. They offer speed but are also more risky as cash transactions are prone to scams. Cash transactions include purchases on P2P exchanges, local groups and also Bitcoin ATMs.
- Cost of Transactions: This depends on the P2P platform you are using. Some platforms charge their own fee for connecting buyers and sellers, if however you are using local groups to find sellers in your vicinity then the cost depends on the price the seller will be asking from you.
- Processing Speed: Faster than bank transfers, it depends on your ability to find sellers or platforms that can allow you to purchase bitcoins for cash. Usually the transactions happen on the spot. If you are buying from a seller make sure that you do not leave before you get the confirmation of receiving bitcoins in your wallet.
- Data Sharing: Cash transactions offer the ability to remain anonymous while making bitcoin purchases, so if you are not too keen to share your data with the authorities then cash transaction is the method for you.
- Accessibility: Cash transactions are not as accessible as purchasing bitcoins through cards or through bank because you need to have sellers who are willing to sell and buyers who are willing to buy at the quoted price. There is also a considerable degree of risk involved here because at times buyers get scammed by sellers.
Conclusion
Hopefully this analysis will help you out in choosing the method that best serves your needs and interests. If you are not too worried about the cost of transaction and are looking for ease of transaction and speed then purchasing bitcoins through cards is the easiest option available, followed by bank transfers and finally cash transactions.