What to know before the first purchase
You can purchase Bitcoin, Litecoin and other cryptocurrencies through this guide, but first you must choose the exchange where you will conduct the transaction.
All exchanges are required to apply KYC (Know Your Customer) and AML (Anti Money Laundering) policies to know who they are with, to better understand the customer and the source of the money. KYC policies often incorporate 4 key elements:
- Customer Identification Process;
- Transaction monitoring;
- Risk management.
KYC is nothing more than checking out who the client says he is. In the financial sector, like in banks, this involves the verification of the entity through a national identity document, address and, in several cases, the additional use of biometrics.
When the registration is complete, you can buy bitcoin and other cryptocurrencies using:
- Credit card or debit card;
- Bank transfer (SEPA);
- Bank deposit;
- Virtual card (via app)
For some, buying bitcoins for the first time can be difficult, but fortunately there are companies that have greatly simplified process, such as Coinbase and Bitpanda, and you can purchase through the aforementioned options, but sometimes the fees can be a bit expensive.
In the website, Localbitcoins.com was the point to buy bitcoins with cash, today, after the measures KYC and AML have applied by the EU, it no longer provides this service, it has several alternative purchase options, it mainly offers SEPA bank transfer and bank deposit.
Be very careful, since these companies often do not have insurance, if the company leaves the market or gets targeted by hackers, something that sometimes occurs. In the past, some of the exchanges attacked returned the funds to the users, but they are not legally obliged to do so, so it is always your responsibility to protect your funds.
If you don't feel comfortable providing your personal information, you can always buy Bitcoins with money, but you will have to look for a street vendor, there are already alternative decentralized platforms, without the need for KYC that provide alternative payments and anonymity. See more in our BUY WITH MONEY section.
Before you start, you should have a cryptocurrency portfolio, some companies require one, you choose one that allows you to have control over your cryptocurrencies. Read our guide to the different portfolios. Some hot wallets also offer the possibility to buy bitcoins in the application such as ABRA WALLET or WIREX CARD.
Finally, you can purchase bitcoins in a Bitcoin ATM, you just have to show the QR code of your Bitcoin address, you can learn more about the location of these machines on the Coin ATM Radar site.