A Guide to Bitcoin for Beginners

Bitcoin has become a buzzword in recent years. As the first decentralized cryptocurrency, it has disrupted the traditional banking system, offering users a way to transfer funds without the need for intermediaries.

If you're a beginner and have heard about Bitcoin, you might be wondering what it is and how it works. In simple terms, Bitcoin is a digital currency that exists on a decentralized network called the blockchain. It allows people to send and receive payments without the need for a bank or financial institution. This decentralized nature, which means any government or financial institution does not control it, is one of the most prominent reasons for Bitcoin's popularity. This gives users more control over their money and can provide a sense of financial freedom.

Additionally, Bitcoin transactions are fast and secure, making it a popular choice for online purchases.

Should You Buy Bitcoin?

A lot of people struggle with this question; should I really not be investing in Bitcoin, or why should I buy Bitcoin?

Whether or not to buy Bitcoin is a personal decision that depends on your financial goals and risk tolerance. Bitcoin can be a volatile investment, so it's important to do your research and understand the risks involved before investing. It's also necessary to diversify your portfolio and not put all your eggs in one basket.

You must note that the value of Bitcoin has been known to fluctuate wildly. In 2017, the price of Bitcoin surged to almost $20,000, only to crash down to less than $3,500 the following year. However, despite the volatility, many investors still believe that Bitcoin is a worthwhile investment due to its potential for long-term growth.

How to Buy Bitcoin

Now that you have a better understanding of what Bitcoin is and how it works let's explore how to buy bitcoin, which is a straightforward process. The specifics may vary depending on your chosen exchange, but the general process remains the same.

Here are the steps involved:

  • Get a Bitcoin wallet:

A Bitcoin wallet is where you will store your Bitcoin. Many different types of wallets are available, including hardware, software, and paper wallets.

  • Choose a bitcoin exchange:

A Bitcoin exchange is where you can buy and sell Bitcoin. There are diverse exchanges available, each with its own pros and cons. Some popular options include Coinbase, Binance, and Kraken.

  • Verify your identity:

In order to use a Bitcoin exchange, you will need to prove your identity. This typically involves providing personal information and documentation such as a passport or driver's license.

  • Add funds to your account:

Once your identity has been verified, you can add funds to your account using a bank transfer, credit card, or other payment methods.

  • Buy bitcoin:

Once you have the money in your account, you can buy Bitcoin by placing an order on the exchange. You can choose to buy a specific amount of Bitcoin or a certain dollar amount.

  • Transfer your Bitcoin to your wallet:

After buying Bitcoin, it's noteworthy to transfer it to your Bitcoin wallet for safekeeping.


Some people feel the need to buy Bitcoin through PayPal. However, this can be a bit more complicated than using a traditional payment method. There may be some exchanges that allow you to buy Bitcoin with PayPal, including eToro, Paxful, and LocalBitcoins. Keep in mind that buying Bitcoin with PayPal may come with higher fees and longer processing times.

Where To Buy Bitcoin?

If you're looking for where to buy Bitcoin, it's critical to do your research and find a reputable exchange by considering your needs and preferences.

  • Coinbase:

Coinbase is a great option for newbies who are looking for a simple and user-friendly platform. With Coinbase, you can easily buy and sell Bitcoin and other cryptocurrencies using your bank account or credit card. The platform also offers a mobile app, making it easy to buy and sell Bitcoin.

  • Binance:

This Platform offers a wide range of cryptocurrencies to trade. It's a great platform for experienced traders who are looking for advanced trading tools and features. Binance also offers low trading fees, making it a cost-effective option for those who want to buy and sell Bitcoin frequently.

  • Kraken:

Kraken is a well-established Bitcoin exchange that presents advanced trading tools for experienced traders. It's a superb option for those who are looking for more advanced features, such as margin trading and stop-loss orders.

  • Bitstamp:

Bitstamp is a popular Bitcoin exchange that proposes a simple and secure way to buy and sell Bitcoin using your bank account or credit card. Bitstamp also offers competitive fees and a user-friendly platform that's great for beginners.

  • LocalBitcoins:

If you prefer to buy and sell Bitcoin directly with other users, LocalBitcoins is a peer-to-peer Bitcoin exchange that allows you to do just that. You can find other users in your area looking to buy or sell Bitcoin and trade directly with them. This can be an outstanding option if you're looking for a more personalized and secure way to buy and sell Bitcoin.

Strategies to Invest in Bitcoin

Investing in Bitcoin can be an exciting and potentially profitable endeavor, but you surely need a clear strategy in place. If you're interested in investing in Bitcoin, here are some things to consider:

  • Dollar-cost averaging:

This involves investing a fixed amount of money in Bitcoin at regular intervals, such as every week or month. This approach can help smooth out the volatility of the bitcoin price, as you're buying at different price points over time.

  • HODL:

This means "hold on for dear life," which involves buying Bitcoin and holding onto it for the long term, regardless of its short-term price fluctuations. The idea behind this approach is that Bitcoin has strong long-term potential, and holding onto it for several years can result in significant gains.

  • Trading:

For those who are more experienced in trading, buying, and selling bitcoin, profiting from short-term price movements can be an effective strategy. However, this approach requires a good understanding of the market and a willingness to take risks, as the Bitcoin price can be volatile and unpredictable.

  • Mining:

This involves using computer power to solve complex mathematical problems and verify transactions on the blockchain. Miners are rewarded with new bitcoins, and this can be a route to acquire bitcoin without buying it on an exchange.

What Can You Buy With Bitcoin?

Bitcoin, once a niche form of currency, is now becoming increasingly mainstream, and its use cases are expanding as more businesses start to accept it as a form of payment. One of the most significant advantages of using bitcoin is that it allows for anonymous transactions, making it an attractive option for those who value privacy. Additionally, bitcoin transactions are fast and secure, making it an appealing online shopping choice.

With Bitcoin, you can buy just about anything that you can with fiat currency, including food, clothes, and electronics. For instance, you can use Bitcoin to order takeout from your favorite restaurant or book a hotel room for your next vacation. It can also be used to purchase digital products like software, music, and video games. Moreover, many online retailers like Etsy, Newegg, and Shopify now accept Bitcoin as payment, allowing you to easily shop for unique and rare items.

If you're looking for a more unconventional way to use Bitcoin, you can consider purchasing gift cards with it. Several websites, such as Gyft and eGifter, allow you to buy gift cards with Bitcoin that can be used at major retailers like Amazon, Walmart, and Target. You can also use Bitcoin to book flights and hotels through travel agencies like CheapAir and Expedia.

Bottom Line

As more people become aware of Bitcoin's advantages and more retailers start accepting it as payment, the possibilities for what you can buy with it are only going to grow.