Today, at the time of writing, we are experiencing history as the 3rd bitcoin halving event unfolds. Unprecedented hype has followed this news sparking an unfathomable interest in the coin around the globe. For that matter, more and more individuals are expressing interest in learning where to purchase it safely.
Unfortunately, crypto scams have been rife in recent years, as has been shown by a recent report by the Better Business Bureau (BBB), a nonprofit organization focused on marketplace trust.
The report found that crypto users aged 22 to 44 lost an average of $3,000 from crypto-focused fraud in 2019. This relatively high figure was mainly the result of nefarious scammers taking advantage of those who lacked foundational knowledge of digital assets, BBB said.
The report also highlighted that 32% of scams involved the exchange of crypto for goods, services, or fiat currency, while 23.4% involved the purchase of digital assets as alleged investment opportunities.
Although these stats can be disheartening for investors looking to get into bitcoin and crypto for the first time, the figures shouldn’t discourage you from embracing digital currencies.
The crux of the matter is that procuring and trading BTC can be safer than using fiat if you are familiar with all the ropes of transacting in digital currencies. Read on and find out the five secure avenues for purchasing bitcoin, which will have you stacking and spending satoshis in no time, along with tips on storing and exchanging your coins safely.
1. Fiat to Bitcoin Exchanges
An established and reputable cryptocurrency exchange can be a relatively simple and convenient way to buy bitcoin for fiat via your bank account. The term ‘Fiat’ is used in the cryptocurrency sector to denote government-backed and issued currency, such as USD, GBP or JPY.
There are multiple exchanges where you can purchase Bitcoin, and most reputable ones are easy and secure to use. It is however, essential to note that if your coins are stored custodial (this means you don’t hold the private keys) and the exchange is hacked or crashes, you may lose your crypto holdings.
This is why it is advisable to move funds to a private, non-custodial wallet as soon as possible after purchasing bitcoin, and only to keep the bare minimum of what’s needed to transact on a centrally managed exchange.
Some websites set up fake exchanges to make gullible people think that they have invested in cryptocurrency. However, these transactions never get written in the blockchain. Thus people lose their money to the scammers.
One common instance of a rogue exchange conning innocent investors is BitKRX, which was exposed in 2017. The exchange rendered itself as a subsidiary of South Korean exchange KRX, the largest financial trading platform in the country.
Crypto investors should be keen to only deal with a regulated exchange which wholly displays its permits on their website, so as to stop an unscrupulous platform from making off with their money.
2. ATM Action
BTC ATMs are hard to beat for convenience if you happen to be located close to one of these machines, and the purchasing process is as stress-free as depositing your fiat money into the ATM, and then you own your BTC coins shortly after.
The site Coinatmradar provides accurate info of machines located near you. Users simply select their location, the type of virtual tokens they wish to purchase/sell, and find an ATM in their proximity.
On March 2, 2020, data compiled by CoinATMRadar revealed that there are now 7,057 crypto ATMs worldwide, allowing people to use cash and debit cards to purchase Bitcoin and other digital assets, or convert BTC into fiat.
Of the top five markets, there are currently 5,089 ATMs in the U.S, 754 in Canada, 303 in the U.K, 126 in Austria, and 84 in Spain.
Unlike exchanges, such ATMs allow users access to a physical kiosk where they can trade fiat for popular digital assets such as BTC, ETH, and LTC.
3. Use a P2P Trading Platform
Another way to buy BTC safely is to connect directly with a seller via a peer-to-peer platform like agoradesk.com, where buyers can select a variety of payment methods, including Paypal, bank transfer, and cash-in-person.
Each user has different offers and charges different rates, so be sure to choose a seller with a good reputation, fair price, and history of completed trades.
Trading platforms for purchasing BTC on a P2P basis usually require varying levels of identification to make a trade. For instance, Agora Desk only needs an email address and is very private, while other platforms may require broader details via know your customer (KYC) and anti-money laundering (AML) policies.
Another P2P platform to buy BTC directly and privately is through a face to face transaction with a seller. This could be a trusted friend or acquaintance living nearby, or someone at a bitcoin meet-up looking to sell crypto for cash.
The fastest and easiest way of making a face-to-face BTC purchase is using a mobile wallet (hot wallet). The seller will scan your public address to send funds to that wallet, and you will then have to decide which way you are going to pay for the sent BTC: in cash or via bank transfer.
4. Use a Credit Card
Another very easy way to buy some bitcoin is to use a credit card. This can be done at buy.Bitcoin.com, and users can choose to purchase either bitcoin cash (BCH) or BTC.
Once you click the “buy” button, a prompt will pop up asking you to enter a bitcoin wallet address. For users without a BTC wallet, there are easy and clear instructions linked via the “Need a wallet?” option that can offer help in downloading one for free.
Although this option usually charges a fixed service charge, the trade-off is that it’s very convenient and fast.
5. Bitcoin Debit Kiosks
For crypto buyers looking for more personalized service than an ATM or online exchange, LibertyX offers BTC acquisitions at retail stores. So far, this is limited to the U.S, but the platform has thousands of locations in the country.
Other similar platforms allow you to buy cryptocurrency with a regular bank deposit or money transfer. A popular example is Bitquick, a crypto marketplace that lets investors pay for digital coins via a cash deposit to a seller’s bank or by sending the funds via Western Union and MoneyGram.
Wall of Coins is a similar crypto marketplace that provides this type of service, conveniently connecting buyers and sellers of digital assets across the globe.
To buy BTC with fiat cash from this platform, you need to enter a wallet address, set a fiat amount in local currency, and you’ll be provided with a payment option such as Western Union, MoneyGram, or a retail bank to make the transfer.
Keep Your BTC Secret and Safe
Non-custodial Bitcoin wallets allow you to safely access your coins on the blockchain via your private keys, mnemonic phrase, and wallet address, from anywhere in the world.
Unfortunately, if you are holding a significant investment of Bitcoin in your wallet, attackers will always try to siphon your identity and transaction data in case that wallet ID gets exposed online.
It is for this reason that many crypto users desiring privacy are turning to Bitcoin mixers as the perfect place to gain 100% anonymity and confidentiality on crypto transactions.
Bitcoin mixers break down your BTC into different parts and then mix them up with coins from other addresses so that third-parties will find it extremely difficult to link your wealth with your identity.
For instance, if you’re using your BTC wallet for regular purchases from a single merchant, your user identity on the merchant website can easily get exposed to hackers. Thus, a Bitcoin mixer turns out to help safeguard your privacy during BTC transactions.
Welcome to 2020, where there are so many many preferences for purchasing bitcoins. However, with many such options, fraudsters and scammers are also gearing up to get a piece of your coins.
Therefore, since there are numerous dishonest exchanges, services, and sellers around, crypto buyers need to be vigilant and pay attention to details to ensure that they are purchasing their Bitcoin from a credible source.
Well, if you adhere to the above tips as your armor to evade scamming attempts, you should be fine.