Blog Guides How to Buy and Sell Bitcoin In 2020

How to Buy and Sell Bitcoin In 2020

-

- Advertisment -

Now more than ever, there are a variety of ways to enter and exit the crypto market. While this is good, the availability of an expanding list and models of crypto portals sometimes overwhelms newbies. Hence, I have created this guide to succinctly explore the most viable and easiest ways to buy and sell bitcoin.

Why Bitcoin?

You might be wondering: There are thousands of other cryptocurrencies available in the market, so why is everyone particular about bitcoin? Bitcoin has emerged as the obvious choice because it is the most established cryptocurrency. As such, it is not as volatile as other digital assets.

Also, it becomes easier to explore other offerings in the crypto world ones you own bitcoin since it is commonly paired with other assets. Another reason is that it possesses inflation hedging capability. Hence, savvy investors are, at the moment, allocating a percentage of their portfolio to bitcoin so as to avoid the impacts of the impending financial crisis.

What Are the Different Ways You Can Buy and Sell Bitcoin?

bitcoins

As mentioned earlier, there are different ways to purchase and sell bitcoin. The first and perhaps the most popular approach entails the use of platforms specialized in facilitating the exchanges and trades of digital assets.

These entities are what we call crypto gateways. They primarily enable infrastructures that allow individuals and corporate clients to exchange fiat currencies to cryptocurrencies or vice versa. A majority even provide crypto-to-crypto exchange facilities. While this is a given, there are three models attributed to this approach.

Centralized Brokers

To buy bitcoin using this model, all you need do is to find reputable crypto channels that provide fixed prices for bitcoin to people looking to sell or purchase bitcoin. For instance, Coinbase functions as a broker because it operates a user-friendly crypto trading platform where users can make payments via credit or debit cards or bank transfers to receive bitcoin immediately.

A similar process applies to people looking to sell their coins. Once a sell order is executed, the platform withdraws bitcoin from your crypto wallet and makes fiat payment through the agreed-upon payment channel. Now that we have the likes of Cash App providing similar services, it is relatively easy to access bitcoin.

Although this approach is straightforward, it has its downsides. For one, these crypto brokers often require cumbersome registration and identity verification processes. Likewise, buying bitcoin from these gateways is expensive. The amount quoted for bitcoin is almost always higher than what it is selling for on other markets.

Peer-To-Peer Trading Platforms

Peer-to-Peer exchanges facilitate a more flexible system for purchasing and selling bitcoin. Here, users can choose the exact amount they want to buy or sell digital assets, create offers, and directly engage with other traders. A prime example of exchanges that fall under this category is Bitcoin Global.

The peer-to-peer exchange provides a lot more flexibility and autonomy to traders. You can either create an offer and set a suitable price to sell or buy bitcoin, or search through existing offers and opt for one with the most reasonable conditions. Once both parties involved reach an agreement as regards payment method and the price rate, Bitcoin global locks the seller’s digital asset in an escrow system and releases it to the buyer upon receiving confirmation of payment.

Although the processes involved in purchasing and selling bitcoin through platforms like Bitcoin Global might seem time-consuming, it ensures that traders access a wide variety of options, especially when it comes to price and payment methods.

Besides, Bitcoin Global has recently introduced price equation formulas that fetch BTC rates from several established exchanges to provide accurate pricing for traders. The price equation formulas currently aggregate BTC rates from Whitebit, Bitstamp, Coinbase, Kraken, and Bitfinex. With this, traders can ascertain that they are selling or buying bitcoin at the best price.

Moreover, the exchange has just launched a limited offer of zero commission on all trades and does not impose identity verification requirements on users.

Crypto Exchanges

Unlike crypto brokers and p2p platforms, it is somewhat hard for new entrants to fully grasp the technicalities of crypto exchanges. However, for those that have the technical expertise required, selling bitcoin on crypto exchanges is fast.

Exchanges act as intermediaries between the buyer and the seller by holding funds on their behalf and undertaking the offer matching procedures. They automatically execute trades as soon as they find a match for your sell or buy offer. Seeing that exchanges take on much of the work, their commissions are higher than what p2p exchanges charge as fees.

Bitcoin ATM

For those who would prefer to opt for a more conventional method, buying or selling bitcoin via an ATM is a possibility. Machines, popularly called Bitcoin ATMs, come with features that can allow you to purchase bitcoin and transfer it into your wallet or sell bitcoin for cash. Depending on your location, it is possible to execute such transactions anonymously. Nonetheless, note that this approach is costly. You can check for the Bitcoin ATM nearest to your location on this site.

What Are the Things to Consider Before Buying or Selling Bitcoin?

Wallets: I am sure that you have a basic knowledge of crypto wallets and why they are vital tools. Also, you should note that it is risky to store bitcoin on exchanges. Instead, you can use them as temporary storage facilities and find more secure wallet services if you plan on holding on to your coins for a while. Most preferably, you can opt for hardware wallets.

Regulation: You should ascertain that the platform you eventually opt for complies with the regulations governing the activities of crypto exchanges in your jurisdiction.

Transaction Fees: Just as it is imperative to research wallet solutions, it is also vital to determine how much it will cost you to use any of the approaches listed above.

BTC Rates: Rates are also crucial factors that you should consider. Due to the siloed operations of crypto exchange and brokers, the price of bitcoin on these platforms may vary wildly. Hence, you must ensure that you opt for one that implements the best pricing system.

Once you have all these factors on lock, you are ready to buy and sell bitcoin. 

LEAVE A REPLY

Please enter your comment!
Please enter your name here

Latest news

4 Tips on How To Succeed on Bitcoin Trading

Bitcoin is a type of cryptocurrency which has grabbed the attention of countless people from different countries....

The First Cryptocurrency Bank License Is Now Granted

This is a historic development. A milestone in Bitcoin's path to broad acceptance and recognition. The State...

Yield Farming Program “Volcano” Kicks off Dutch Auction for Cryptokitties KittieFIGHT Game

In the fall of 2017, along with the rallying of Bitcoin and other digital assets, Cryptokitties dominated...

Ministry of Foreign Affairs of Denmark may use Blockchain to tackle corruption

We have already moved to the stage in our lives where technology plays an important role in...
- Advertisement -

What Lessons Can The World Learn From Venezuela’s Newfound Love For Crypto?

It is often the case that great changes are forced out of necessity, rather than a willingness...

How Bitcoin Capitalization Affected In 2020 on the Quarantine Background

Although the weeks of quarantining are gradually easing off, the impact of dealing with the deadly coronavirus...

Must read

4 Tips on How To Succeed on Bitcoin Trading

Bitcoin is a type of cryptocurrency which...

The First Cryptocurrency Bank License Is Now Granted

This is a historic development. A milestone...
- Advertisement -

Read Next
Recommended to you