It looks like you have done all the background research about Bitcoins, the digital currency and are ready to buy Bitcoin.
So, let’s help you find the best way to buy Bitcoins. But, before that, I want to be sure that you know that your transactions will be public. The backbone of Bitcoin is its Blockchain, the distributed public ledger and all your operations are there, for ever.
How do you earn Bitcoins?
Bitcoins are like dollars, a form of money but in digital form. And you can earn Bitcoins in the same way you make dollars.
Yes, you can find many websites giving you Bitcoins for free, but you won’t be getting rich that way anytime soon. There are PTC (pay-to-click) websites where you get money by watching ads or clicking on them.
Some also pay you for completing surveys, watching videos, playing games or installing applications.
And I hope you know how much they pay, a small fraction of a dollar. Just imagine it regarding Bitcoins. OK, let’s get serious now. The oldest and the most unconventional method of earning Bitcoins is mining them.
Mining is the process which involves solving the cryptographic puzzle to validate Bitcoin transactions, but mining isn’t for the faint of hearts.
You need to invest considerable money on your PC hardware and keep it running for maximum earning. So, let’s search for the conventional ways. But before you get your first Bitcoin, you need a place to store it, right? And that’s what a Bitcoin wallet is used for.
Setting up a Bitcoin wallet
A Bitcoin wallet is like a bank account where you store your Bitcoin. But, here you don’t need any ID to set up an account. You can sign up with your email ID and start accepting Bitcoin. There are two types of wallets – Online (Hot wallets) and Offline (Cold wallets).
Hot wallets are those which are in software form. You can download one for your internet-connected device – PC or mobile – or use the web version. Then there are the hardware wallets (or cold storage). Unlike the software version, you will need your cold wallet with you every time you have to send some amount of money. Secured, isn’t it?
The unique thing about Bitcoin wallets is that they don’t hold any Bitcoins (like some balance amount).
They contain a private key, a long, complicated string of alphabets and numbers, which you need when sending money to Bitcoin addresses. And to receive any amount, there is a public key, a long alphanumeric string (again).
Once the wallet is ready, you are prepared to send or receive Bitcoins.
Purchasing Bitcoins at an exchange
One of the most trusted ways to get a hand on Bitcoins is at a bitcoin exchange like Coinbase. It’s one of the oldest among the Bitcoin exchanges, and you can trade some of your USD for BTC. But a single BTC costs over $8000, can I buy half a Bitcoin? The answer is yes.
And can you buy part of a Bitcoin? Yes, like USD you can buy BTC (Bitcoin core) in fractions. And the smallest tradeable amount in Bitcoins is 0.00000001.
This smallest amount is called Satoshi. So, you see you can purchase Bitcoins for even $1. Although you get a little amount, you still own and can use those digital coins. Pretty pocket-friendly, right?
Now, when you have an account set up with an exchange, start trading. Yes, I mean like you do with shares. Buy when the price falls and then sell them for profit. It’s a high-risk task, and you always have to be aware of the ongoing cryptocurrency scenario. You have to do the analysis the whole time, to know the right moment to buy or sell.
Poloniex, BitStamp, Cryptopia, Kraken, and Shapeshift are some of the many exchanges where you can trade. These exchanges also deal with other cryptocurrencies if you are up for a change.
If you are in, and now wonder how to transfer Bitcoin to a bank account, you should be glad to know that many exchanges facilitate wire transfers, direct to your account, for a nominal fee.
Coinbase, for example, can withdraw amount through the connected bank account, debit card or even credit card. You need a government ID though. And when you have some profit, initiate a wire to your account or credit card.
With the Coinbase wallet, you can also sell Bitcoin for PayPal cash. Although PayPal still doesn’t facilitate paying for Bitcoins, you can withdraw your amount in Coinbase through a PayPal transfer, after conversion to USD.
Buying Bitcoins in person
Bitcoin is a peer-to-peer system, and you can always get Bitcoins from someone willing to sell it. There are websites and forums to help you find one. You can either send them an online transfer and get cryptos in return (if they are trustworthy) or set up a face-to-face meeting and pay them in cash.
The method is faster than transacting with exchanges. You meet someone, set up a meeting, get the amount to your Bitcoin address (created without an ID), and you pay them in cash.
You don’t need to know each other’s real name or other personal details. Finding someone trustworthy is a bit difficult, but you can always meet in a public place to be safe.
Then there are services like LocalBitcoins, an online marketplace with protection for both buyers and sellers. It also has a feedback system to help identify the ‘trust.’
The above two methods were to get money in exchange for money. How about some hard work (luck, I mean).
Although not a recommendation, gambling still is a thing and a way to make some Bitcoins. It does not require any special skills and is an easy way for some and many websites offer lotteries and jackpots with Bitcoins.
You can also find casino games where they accept Bitcoins in return for more Bitcoins, but you, sure, do know how it works. It’s risky and depends on pure luck (and a bit of cheating, oops). And it’s very possible that you will lose your entire sum than acquiring some more. Not everyone has every day as the lucky day. So, stay away!
Earn Interest by Lending
Put your money to work, and it will help you back, right? So, why not lend it to people? There are online platforms where there are facilities for meeting and peer-to-peer lending. Consider it as an investment, where you can get more after a certain amount of time, but take precautions, you know why. Or you can always lend someone directly, of course.
Then there are websites like Bitbond and BTCjam where you can deposit your hard-earned BTCs and get interests at a rate for the deposit amount. But before you commit yourself to any such online services, do read their terms and check their reputation.
Even offline lending has its risks. The Bitcoin project you lend your money to is nowhere to be found, or you spend more time and effort to make sure they pay.
And in the worst case, your acquaintance is not giving the sum back, forget the interest. All instances that apply to lending real money confirm with Bitcoins too. So, make your choice wisely.
Selling Goods and Services
And one of the most popular ways to get Bitcoins is by selling products and services. You can put the “Bitcoin Accepted Here” at your shop’s payment counter, your hotel or restaurant, and customers may prefer paying in Bitcoins. Mobile services like product delivery or food-on-wheels can stick a QR code of their wallet address on the vehicles.
If you have an online store, you can use this option there beside the credit card, net banking or PayPal options you offer. It can also be used by the home base entrepreneurs.
Receiving as Payment for Jobs
Home-based freelancers, workers or consultants can get payment in Bitcoins. There are many platforms which offer such services.
And you can find one suitable for you whether you are a singer, editor, designer, designer or marketer. There are lots of opportunities at websites like Coinality and Jobs4Bitcoins.
Other such sites offering Bitcoins in exchange for service are XBTFreelancer, CoinWorker, and bitWAGE, and there also are many other online forums and Reddit. The opportunities are for freelancers mainly, but with higher Bitcoin acceptance you may find companies offering regular payments in BTCs soon.
Also, Bitcoin-related services can also help you get paid in Bitcoins. There are many technical roles, or you can be a blogger.
BitcoinTalk is a website where you get paid in cryptos for your posts. Depending on the quality of the posts and what you chose to write, you can make some good income writing about Bitcoins.
Another earning opportunity is at Bitfortip if you are good at finding answers. People ask what they want to know and those who answer get Bitcoins in exchange for the answer.
Well, these were the most prominent ways to get hands on a substantial amount of Bitcoins. Which one do you think you are going for?