An introduction to Bitcoin
Bitcoin is an ‘encrypted digital online cryptocurrency’, created by Satoshi Nakamoto in 2008, and first used in 2009. All that really means is that it’s a virtual currency, with all of the transactions online and with nothing physical about it. And if that scares you slightly, fear not, after all, when you think about money, it’s all somewhat virtual – just pieces of metal and paper with a promise from the government to pay the bearer a sum.
The idea behind bitcoin’s creation was to create an independent world currency, not linked to traditional financial markets, untraceable by governments, totally secure, and protected by Nakamoto’s revolutionary new algorithms. Bitcoin is designed with absolute transparency, as all transactions are publically viewable in something called the blockchain ledger. All transactions, because they have to be verified to go through the public ledger, need to be carried out by Bitcoin ‘miners’. Crypto-mining USA has become big business, with these ‘miners’ verifying and keeping the blockchain record/ledger.
Bitcoin has become big news, most notably in the betting sector with crypto-gambling casino USA very popular. And as it becomes more and more common, the structure around it has become somewhat more traditional, especially if you’ve ever looked at stocks and shares trading and you’ll see that crypto-trading in the USA is very similar to share trading. You can find both cryptocurrency brokers for bitcoin trading USA and an increasing number of bitcoin trading platform USA applications – which is exactly what we’re explaining next!
Bitcoin trading explained
Bitcoin trading USA is actually easier to do than you’d think. When you’re asking how to buy bitcoin in USA, you’ll find that there are two main ways; you can use a bitcoin broker to buy them direct or, for the preferred way of most people looking for the best way to buy bitcoin in USA, you can use a bitcoin trading platform USA or a bitcoin exchange.
When discussing bitcoin trading, you may have heard mention of both bitcoin exchanges and bitcoin trading platforms. A lot of people involved with Bitcoin buying and selling can use either one but there is a difference.
A bitcoin exchange is a service just like a currency exchange, where you are converting bitcoin to dollars (or the currency of your choice). A bitcoin trading platform usually does everything the exchange does but also adds in a bitcoin trading service where people can trade coins between each other and as such, just like share trading, is far more complicated, with buyers and sellers setting prices.
Now, when you’re looking at buying and selling bitcoin, it’s actually very simple. First, set up a bitcoin wallet – there are plenty of crypto-wallets available in the USA. The next step is to fund it with your own dollars, and then see those $ converted to BTC. And when you look at the different trading platforms and exchanges, you’ll find they’re all basically similar –buying, selling, and with trading platforms proper – trading coins. The key differences between exchanges or trading apps are reliability, security, speed, trading fees, and methods of payment – all of which we’re going to be looking at!
Bitcoin trading in the USA
When you’re looking at how to buy bitcoin in USA, you’ll find there’s a huge number of different exchanges and trading platforms open to you. But of course, all of these have pros and cons, which we’ll go into in a little while. But the best advice for bitcoin trading USA is undoubtedly to look at where your trading platform is based. US regulated platforms give you that bit more security!
Getting a secure & fair experience with Bitcoin trading
When you’re looking at how to buy bitcoin in USA and what the best bitcoin trading platform USA might be, it’s vital that you make sure you think security first and foremost. For bitcoin trading USA, we always say look first at USA based platforms for crypto-trading, just because they have to comply with the US Securities and Exchange Commission’s regulations, as compared with overseas platforms where regulation can be somewhat more fluid. Of course, this regulation comes at a price and some users who want to trade anonymously might want to consider foreign trading platforms instead of using a bitcoin trading platform USA.
But in addition to this, you need to do a little research on the best bitcoin trading app USA (or much easier – let us do it for you!) It’s important to look at all the security features of the platform that’s going to be handling your cash, your financial information and your personal information. Ideally, you’re looking for strong account verification, 2-factor authentication, a secure and encrypted site, PGP encryption of communications… basically all the things you’d look for when dealing with your regular bank!
Another key thing to get that secure and fair experience is to do some reputation research – find out what experiences others have had with the platform. What’s their customer service like? Have they ever been hacked? – for example – Hong Kong’s Bitfinex, making up about 10% of the US market share, was hacked in 2016 with $70 million lost. The more you know, the better your choice for bitcoin trading USA.
Editor’s recommendation – the best trading platform for bitcoin in USA
For the best bitcoin trading platform USA, we’re recommending two great platforms/exchanges; Coinbase and Binance.US.
When starting to buy and sell bitcoin in USA, there’s no better choice than the Coinbase exchange. It’s made it wonderfully simple for you to find out how to buy bitcoin in USA for the first time with intuitive and simple layouts, a range of payment methods that most will use, individual wallets, and a great customer service reputation, Coinbase is our first timers pick for the best way to buy bitcoin in USA. And once you’re ready to move up to trading bitcoin, you can take advantage of Coinbase Pro, the Coinbase trading platform.
For more experienced bitcoin users, our best bitcoin trading app USA is Binance.US. This trading platform is more complicated but we pick it for bitcoin trading USA because of its low fee structure (0.1% spot trading fee; 0.5% Instant Buy/Sell fee), lack of hidden fees, and a range of no-fee deposit and withdrawal options available to US residents (although it’s not available to residents of Alabama, Connecticut, Florida, Hawaii, Idaho, Louisiana, New York, North Carolina, Texas, Georgia, Vermont, and Washington.)
This is how our experts test trading platforms
When we’re looking for the best way to buy bitcoin in USA, we look at several important criteria to choose our editor’s for the best bitcoin trading app USA. In addition to the security checks we’ve already discussed, we generally look for ease of use, speed of transactions, and cost of using the trading platform.
When looking at how to buy bitcoin in USA we’re looking for a simple, pain-free experience first of all. So we look at trading platforms and exchanges from the point of view of a complete newcomer. We look for sites and platforms that operate intuitively, hold your hand through the process of buying bitcoin, help with setting up wallets, have great customer service, and a clearly laid out system of letting you know what to do, how to do it, and how much it’s going to cost. When comparing the speed of bitcoin trading USA, we look at how long it takes for you to set up your account, verify your identity, and begin to buy bitcoin. We’ll also take a look at the speed of transactions once you’re set up. And finally, when we look at price, we consider the overall cost, looking at up-front fees, any extras or hidden fees – for example those for different payment methods, and trading commissions.
Expert tips for how to buy bitcoin in USA
When you’re first thinking about how to buy bitcoin in USA, it seems complicated and daunting. But that’s where we can really help. First we’ll take you through a step-by-step guide to buying bitcoin and then we’re going to highlight some essentials to remember when dealing with bitcoin, whether you’re buying for the first time or an experienced trader used to buying and selling and using trading platforms.
How to buy bitcoin in USA – a step-by-step guide.
For first time buyers, we recommend the Coinbase exchange for its simplicity. Here’s how to buy bitcoin at Coinbase (although the process is the same through most exchanges and trading platforms.)
- Register for an account with Coinbase by providing email, phone, and personal details.
- Set up a secure password – remember that this is a financial site and your password should be very strong.
- Before you can trade at any exchange or trading platform, Coinbase included, you will need to verify your account – this includes verifying your email address and phone number and uploading your proof of identity and residency in the USA.
- Always enable 2-factor authentication for extra security.
- Deposit funds into your account by clicking on the ‘Deposit USD’ link. This enables you to transfer funds to your account via credit/debit card.
- Buy bitcoins by clicking on the ‘Buy/Sell’ tab and then clicking on the ‘Buy BTC’ link. Enter either the value of BTC you want to buy or the value of USD you want to spend.
- Check the details carefully – there’s no cancelling of bitcoin transactions.
- Click ‘Buy’.
And that’s it – you’ve bought your bitcoins!
Essential things to remember when buying and trading bitcoins.
Whether you’re a newbie looking at buying and selling bitcoin or an experienced Bitcoin user who’s been trading bitcoin for years, there are certain things to always remember with bitcoin.
- Security, security, security. Treat your bitcoin transactions and trading as you would your personal or business banking and always keep security at the forefront of your mind.
- Private keys are the key! Like any new way of doing things, do some research and understand what’s involved. Make sure that you have access to a secure private wallet and store your private keys securely.
- Bitcoin is a very volatile currency. Over the history of Bitcoin, the value of this cryptocurrency has risen rapidly, but it’s also experienced extreme volatility over time with large gains and large losses. This is a hugely unpredictable currency with a high level of risk.
- Bitcoin transactions cannot be cancelled. It’s vital that you thoroughly check every single transaction you make when dealing with bitcoin – once you click buy, sell, send, or trade there’s no going back! Check and check again!
- Bitcoin is not anonymous. Despite what you hear, the majority of bitcoin transactions when using exchanges and trading platforms are not anonymous. For the majority of us users this is not a problem.
- Pay your taxes! If you’re using exchanges or trading platforms for bitcoin trading USA you should remember that these are financial transactions just like any other – and that means TAX!
Whether you’re a complete novice wanting to know how to buy bitcoin in USA for the first time or an experienced Bitcoin trader, you should have found much to consider here in our bitcoin trading USA guide. But here are our three big takeaways…
- For the majority of bitcoin trading USA, unless you’re particularly looking for anonymity, we always recommend looking at US based trading platforms for buying and selling as you’re protected by US regulations.
- Always read up on any exchange or trading platform to ensure it’s safe and secure – a good rule of thumb is expect the same from your bitcoin trading platform as you would from your bank.
- If you’re new to bitcoin buying/selling and trading and want to know how to buy bitcoin in USA, look for a simple trading exchange app such as Coinbase before moving up to a proper bitcoin trading exchange.