It’s certainly no secret that cryptocurrencies will likely be the way of the future in terms of finance. The initial skepticism from the early days of Bitcoin has now been proven redundant, and in some cases flat-out wrong. There has been a massive adoption of crypto amongst retail and institutional clients due to its advantageous features. Cryptocurrency such as Bitcoin is also becoming increasingly straightforward to deposit and withdraw.
Entire industries are now being integrated into various blockchain platforms. These systems will be represented with tokens that are commonly known as cryptocurrencies. These cryptocurrencies are paving the way for Non-Fungible Tokens (NFTs) and other Web 3.0 technologies. The future of technology is officially here, this is largely due to the success of cryptocurrency!
But it all starts with first exchanging legacy fiat for Bitcoin, there are a variety of ways to achieve this. Once this is done, you can start researching other cryptocurrencies called altcoins. You can transfer and withdraw Bitcoin and other cryptocurrencies easily once you understand how the entire ecosystem works.
Why Buy Bitcoin?
Cryptocurrency has multiple advantages over traditional fiat currencies. It is secure, fast, low-cost, and relatively straightforward to use. Cryptocurrency is also built on an extremely versatile technology called the blockchain. You can use crypto to pay for things, store money as an investment, and as a potential hedge against inflation (which is running rampant). 35% of the world's currency was printed in 2020, according to official statistics from the Federal Reserve.
Crypto enables people to send funds instantly, regardless of where in the world the recipient lives, including micro-transactions with ultra-low fees. This is not the case with the legacy banking system, with its negative interest rates, wire transfer fees, and international transfer fees (to name just a few). In sum, cryptocurrencies are superior to legacy currencies on the grounds that:
- Cryptocurrencies are much quicker in comparison
- It’s free to hold cryptocurrencies
- Your identity is anonymous
- Your transaction is private/pseudonymous
- There is no red tape and bureaucracy
- Online cryptocurrency wallets are available to everyone
- It’s easy to withdraw Bitcoin without needing third-party approval
The main hurdle with cryptocurrency is the initial point of entry. You will first need to invest in Bitcoin. Once you have done this, Bitcoin can easily be swapped for other types of cryptocurrency. If you purchase a different cryptocurrency, it might not be as easily swapped, and its associated fees might be higher.
For instance, if you purchase Ethereum, it's currently impossible to send it without paying huge network fees ($50 - $150). So Bitcoin tends to be the best initial purchase and the safest long-term store of value, which will eventually allow access to more niche tokens.
Some of the most reliable methods of acquiring Bitcoin are as follows:
#1 - The Bitcoin ATM
Bitcoin ATMs (BTMs) are probably the most direct and secure means of purchasing Bitcoin. Many users are familiar with legacy ATMs, though the process is a little different when using modern BTMs.
When buying Bitcoin with a BTM, you don’t physically withdraw any Bitcoin from the BTM. When people choose to withdraw Bitcoin, they really mean purchasing Bitcoin in return for their fiat cash. Users can withdraw Bitcoin from an online exchange and then send it to their private wallet. Once a BTM user has paid for their Bitcoin, it can be sent to their wallet.
Bitcoin ATMs provide users with a reliable way to buy and sell cryptocurrencies. Oftentimes the transaction can be completed within 10 minutes since the fees are quite reasonable. Typically they are between 8% to 12% with high-quality vendors, along with a small network fee between $0.99 to $3.99. Bitcoin ATM machines come with KYC software, which means identity verification is automatically completed. This also adds a layer of reliability to the entire process, which makes BTMs an excellent way to purchase Bitcoin.
BTMs are far safer than any other method of purchasing and withdrawing cryptocurrency. Since Bitcoin ATM owners have significant compliance requirements they must adhere to, this helps eliminate the risk of being scammed. The cryptocurrency industry is rife with scams, which is one reason why Bitcoin ATMs have seen such tremendous growth in recent times. Bitcoin ATMs are safe, fast, compliant, and transparent methods of buying Bitcoin.
Certain BTMs also offer multiple methods of transferring Bitcoin. Crypto Dispensers, for instance, offers three methods - the Bitcoin ATM, the online account, and the in-store exchange. Crypto Dispensers is partnered with Rite Aid and CVS allowing users to deposit cash for crypto at select locations or deposit via ACH. You can also visit one of 50 Crypto Dispenser BTMs in accessible areas for an exchange.
Crypto Dispensers BTMs are extremely easy to use, they are fast, and 100% transparent. You can even purchase up to $900 in Bitcoin without going through the KYC identity verification process. Users must simply enter the transaction type and information, key in their wallet details, insert the cash, and wait for the transaction to complete. Fees are also transparent and clearly outlined with a $1 network fee and a charge of 5% above the spot price. Users can easily withdraw Bitcoin from the BTM and send it to their private wallets.
#2 - The Online Exchange
There are currently multiple types of online exchanges which allow users to purchase a certain amount of cryptocurrency. These exchanges are among one of the most common methods of purchasing cryptocurrency. A few popular exchanges include Binance, Kraken, and Coinbase. However, these exchanges do carry a number of inherent disadvantages.
The first issue is that it's not as easy for certain online exchanges to compete with KYC regulations. It can take a longer period of time to get verified, which isn’t helpful if you want to buy a dip. The second is that it has become common knowledge to not hold your cryptocurrency within a wallet owned by an online exchange. This is simply because online exchanges have a history of being hacked. Just like with a bank, you don’t really ‘own’ the funds unless you own the account holding the funds.
Third, the fees associated with these online exchanges can be extremely complicated for users to understand. There is a different rate for trading (0.1% to 0.25%) and purchasing (4% to 12%). There are also fees for withdrawals and certain types of transfers. If you withdraw Bitcoin and transfer the funds to a different account or to a bank, you could get hit with a fee.
Lastly, it’s much easier to fall prey to a scam when using online exchanges. Phishing sites are common and hackers could easily gain access to your username and password (though most exchanges now have 2FA features).
Online exchanges have played a major role in terms of furthering the growth and adoption of the crypto industry. They are perfect for traders looking to buy or sell crypto frequently, due to their low fees. However, for outright purchases, there are easier options than purchasing through an online crypto exchange. Online exchanges can make it hard to withdraw Bitcoin since online exchanges prefer to keep crypto in their control.
#3 - Peer-to-peer Transactions
With an online exchange, users are purchasing crypto from a large centralized agency. With peer-to-peer (P2P) transactions, users are able to buy directly from an individual that holds the crypto. P2P transactions do not come with the same level of red tape and compliance procedures, and they are much less formal.
This method of acquiring Bitcoin does come with its own set of inherent risks. P2P sites are actually even riskier than online exchanges since scams are more prevalent. Many news users have been enticed to give away their crypto funds, never to see them again.
P2P sites do offer a wide variety of payment mechanisms for users to choose from. Users will search their search engine for a buyer that meets their criteria in terms of price and payment options. The single most important step with P2P transactions is verifying the reputation of the seller. Users should only deal with people who have made a large number of trades and who have high approval ratings.
You can even meet somebody in person in your area to complete a P2P transaction. This would be purchased directly with cash, which is becoming very rare in the crypto community. The risks associated with this are obvious, and better alternatives exist. Without using an escrow system, you will need to trust that the seller will release the funds to you after the payment.
While this was common years ago, it’s much easier and safer to simply use a BTM where you know exactly what to expect. If you deposit Bitcoin into the wrong account and the seller decides not to pay, there is nothing you can do. However, this does not occur very often with Bitcoin ATMs.
Keeping Your Crypto Safe
Remember that once you purchase Bitcoin, it's stored in a wallet that only you have access to. When you set up a wallet, you are given an initial seed phrase that is your responsibility to store. This seed phrase is either a list of 12 or 24 words that users need to write down and keep safe. This seed phrase can be used to access your wallet, so it is important not to share it with anyone.
If you lose this seed phrase and your computer breaks, you could lose access to your cryptocurrency forever. This is a backup - when logging into your wallet, you will enter a password of your choosing. You can also get a backup in the form of a private key or keystore file. The most important thing is that you keep all of this information safe. If you think your account may be compromised, withdraw Bitcoin and other altcoins to a different wallet immediately.
It’s also important for users to be wise in terms of how they use their funds. Check the HTTPS certificates on all sites to make sure they are legitimate and don’t send any funds to another wallet address without verifying its validity.
A lot of the benefits associated with cryptocurrency are there due to the fact that there is less interference from third parties. This means that the network can run much more smoothly and it's easier to get up and running. However, this also means that there is no insurance for people who transfer their funds to the wrong wallet addresses.
Purchase Bitcoin the Easy Way
All things considered, the Bitcoin ATM method is likely the safest and easiest way to acquire Bitcoin and enter the world of crypto. With Crypto Dispensers and its secure online account, the process is simplified even further.
You can create a Bitcoin wallet with Crypto Dispensers and purchase crypto using a BTM, in-store deposit, or online exchange. So you can actually purchase from the comfort of your home. Not all online exchanges are safe or compliant, despite their false claims. And using a Bitcoin ATM is a very intuitive experience for virtually everyone.
The sooner you become familiar with Bitcoin and the broader cryptocurrency ecosystem, the better. Cryptocurrency is paving the way for an array of other defi innovations, built on blockchain and smart devices. In the future, we will likely see Bitcoin ATMs grow in popularity as more countries continue to adopt cryptocurrencies.