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How to buy bitcoins in the UK?
Many transactions these days are being done with bitcoins being used as the mode of payment. The world is moving in the direction of cryptocurrency and blockchain technology, most especially because it provides an anonymous way of carrying out transactions. To understand the ways of bitcoin and how it is being transacted in the UK, please check through the rest of this article.
A team of experts will get you the answers you need to get started with your business.
What is a bitcoin?
Although the originator of the bitcoin cryptocurrency has been widely debated and severally disputed, the origin of bitcoin itself is known. The usage of blockchain-hosted currency started after the Great Recession of 2008 when it was obvious that traditional currency is falling below its expectation.
The inventor, Satoshi Nakamoto, created it in 2008 and by 2009, bitcoin miners have started to transact with it.
According to economists, bitcoin is a legal tender because it satisfies three qualities of currencies. The three qualities are that it is in limited supply, hard to earn, and can be verified.
Bitcoins are mined by solving complex cryptographic puzzles that are constantly uploaded on the peer-to-peer blockchain server. Once they are verified, it becomes a block or node added to the ones before it. This attribute qualifies bitcoin as not being easy to earn and verifiable.
How and where to buy bitcoin in the UK
Even though the mining of bitcoins is very complex, you do not have to go through the stress. Like any other currency, you can invest in it depending on the prevailing exchange rate at the time.
The platforms for buying cryptocurrencies are called crypto exchanges which can be hosted via websites or mobile applications. These crypto exchanges will allow you to fund your bitcoin wallets using PayPal or other online payment platforms.
The best crypto exchanges in the UK are eToro, Uphold, Coinbase, Coinjar, Phemex, Revolut, Coinsmart, etc. These are platforms that offer you the opportunity to exchange your traditional or fiat currencies or cash for cryptocurrencies, a category to which bitcoin belongs. Fiat currencies are your everyday pounds, dollars, euros, etc.
How to keep and transact with bitcoin
After buying the bitcoin, you can either leave it on the crypto exchange platform to be exchanged for fiat currencies whenever you wish or you move it to the bitcoin wallet. You can also decide to leave some of it in the marketplace while the remaining is locked up in the crypto wallet. This way, the one left in the marketplace can be used for transactions and the one locked up is kept safe away from hackers.
Your bitcoin wallet can either be different or the same one provided by your crypto exchange. If you would like to use the wallet provided by the crypto exchange you are using, it’s all good. Otherwise, you can choose to use another private wallet away from your crypto exchange, for better security. This comes at additional fees but it may be well worth it.
Pros and cons of trading in bitcoin
Like other forms of exchange, bitcoin can be used to do the following and more.
- Bitcoin is a way to store large sums of money away from the bank.
- It is an easier and faster way of making purchases instead of cash and issuing a traditional or cashier’s check.
- Up until now, the government has not been really able to track purchases made through bitcoin which is why its use and acceptance are still being restricted.
- Bitcoin has more chances of appreciating when left for a period than your regular money. This makes it a more worthwhile investment than most stocks.
- The bitcoin cannot be devalued by a single entity, say the central bank for example.
- You can easily sell your bitcoin for cash when you need it for urgent mundane transactions.
- It is far more reliable and stable than other forms of currency.
Risks of trading bitcoin
We have listed some of the benefits of investing in bitcoin. There are however risks attached to it.
- Because the rise or fall in the values of bitcoin is controlled by pair-to-pair transactions, the sale of a huge sum of bitcoin by a large account holder can drop the rates and you can run at a loss. The bitcoin dip of 2020 during the COVID-19 pandemic is an example of this. It can also happen when there are more sellers than buyers.
- Although, there are people who tries to maintain decorum in the trading and investments of bitcoin, you should no that if there is a loss or theft of your bitcoin, you cannot recover it. This is because it is a decentralized legal tender with no clearly defined rules or regulations. There is no regulatory body to lodge any complaint if there are any legal issues or fraud.
- Most countries are yet to accept trading or investing in bitcoins and is therefore an illegal means of transaction in such countries. Therefore, investing in it may be dangerous and attract penalties. The reason for this is mostly because many illegal activities are being carried out and paid for through bitcoin since it is untraceable.
Because of these risks, investors are therefore enjoined to be careful and take all necessary precautions to ensure the safety of their precious bitcoins.
Conclusion
Making transactions anonymously has become easier in the era of cryptocurrencies. Bitcoin is the most lucrative of all of these cryptos and it offers a unique form of financial safety. When you store your money in bitcoin, it is very unlikely that things like a recession or economic crisis will affect it since it is not controlled by financial institutions.
How to buy bitcoins?
1. Choose a crypto exchange platform
Make sure you have adequately researched their customer satisfaction level and ensure that it is FCA-approved. This will give you a level of confidence to keep your money with them.
A team of experts will get you the answers you need to get started with your business.
