How to buy Bitcoin

Bitcoin crypto-currency continues to gain popularity. The recent rapid growth of its rate has returned this currency to the headlines of the financial news. In March more than 20 000 users registered on MtGox, the biggest Bitcoin exchange. More and more people are interested in Bitcoin. And naturally, the novices have the question where and how to get “coins”. In this article we’ll review different ways of it with their advantages and disadvantages.

Buying Bitcoin directly from other users

On some forums such as Bitcoin Talk there are threads where the users negotiate about buying/selling/exchanging Bitcoin. So, you can register and leave a message there that you wish to buy some quantity of Bitcoin.

Also, there are services such as Bitcoinary and IRC-channels for p2p-exchange, for example, #bitcoin-otc. The main problem of such direct deals is, of course, security. For a novice it will be extremely hard to avoid fraud, because you should consider many details and nuances.

For example, there are some fraud exchanges using PayPal. As you may know, this payment system allows to cancel the transfer if the user hasn’t got what he expected. So, the scammer can use this feature to fool you: after you already sent him funds, he may declare that he didn’t get anything from you. That’s why most of exchangers and exchanges don’t accept PayPal as a buying method. Even the experienced users may become a victim of such “tricks”.

Of course, almost every big forum has guarantor who can be used in the deal. However, he takes his own fee for that, but then the main advantage of direct deals – low cost – is lost. In this case you should think of using exchanges or exchangers.

Exchanges

MtGox and BTC-e are the biggest Bitcoin-exchanges. The fees usually are from 0.2% to 0.6%. The withdrawing process takes from 5 minutes to 24 hours – it’s mainly caused by the properties of Bitcoin network itself. The main disadvantage of the exchanges is instability in their work, with which users face periodically. Users might see that clearly during the recent rapid growth of Bitcoin’s rate. Many visitors came up to the exchanges’ sites and they have been down and unavailable for a few hours. MtGox wrote about technical problems on their site.

Moreover, in the beginning of April this exchange was suffered from the hackers’ attacks, which, probably, aimed to repeat the site’s hacking which happened in 2011. The obvious security problems were likely resolved, but anyway the instability in work still remains. Unfortunately, it may really happen that you, not getting your Bitcoin in time, can’t even access the service then to know what’s up with your “coins”. Recently the BitFloor exchange from New York has been closed, cancelling all trading operations and returning the deposits to the users. We can also remind that in October of 2012 hackers stole 24 000 of Bitcoin from this exchange.

Exchangers

Considering all written above, the optimal way to get Bitcoin today is using the e-currencies exchangers. Of course, it should be the reputable and trustable exchanger. The biggest and most popular services of this kind, such as WM-Center, appeared long before the world met Bitcoin and today they continue to work successfully with this brand new e-currency as well. Their experience is a kind of guarantee that you’ll get your funds in time and without any risks. Mostly the fees which are taken by exchangers are just little higher than exchanges’ ones and, what is important, this option isn’t risky at all. Moreover, WM-Center periodically makes sales during which you can buy Bitcoin without any fees (at the market rate) or using other interesting offers. So, buying Bitcoin from exchangers helps users not only to save their time and nerves, but sometimes – also the money.

While exchanges open and close, such reputable site as WM-Center – the international service with its history, that has been working from 2005 – expands and offers news payment methods. To buy Bitcoin on this site, you should place an order in the Buy section choosing the payment method which is most convenient for you.

Mining

We can’t but write about one more way to get Bitcoin. It’s mining itself. Initially it was the main way to get “coins”. But today, because of growing hardness of this process, it is mainly practiced by Bitcoin mining pools, which gather many users and resources of their computers into one network, or singles with “farms” – hardware with many video cards. In the first case the earnings are not big – all that pool earns is divided equally between participants. As for the second case, having and using such “farm” isn’t a cheap thing at all. Strictly speaking, mining has never been free, you know – if you don’t have a free electricity, of course.

A little of exotics

And finally, some exotic ways to gain (or loose) Bitcoin:

Playing the Sapper game for money, in this case – for Bitcoin;

Bitcoin-roulette;

Financial pyramid;

Getting “coins” for making different jobs;

Getting “coins” for ad viewing.

The choice as always is up to you.
See also:

«Liberty» vs «perfection»: comparing Liberty Reserve and Perfect Money e-currencies

E-currency thefts how they are, or How to store your electronic money safely

Bitcoin “jumping”

Paypal Fee Calculator

Bitcoin’s new record

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