Note: This is the second of my series of posts on Bitcoin. Read the first post here.
So, now you have heard about Bitcoin. You have done a little research, scanned the forums, maybe watched a couple of our videos, and are finally ready to jump in and get some for yourself. But how exactly are you going to go about it?
Mining is complicated and difficult, and definitely the slowest way to get those first BTCs in your wallet. Maybe you have nothing to sell, and don’t feel like picking up freelance work to earn bitcoins. Like most of us then, you are going to have to buy BTCs, and there are a few ways to do that.
Now, which of these options will work best for you depends on what your priorities/needs are, as well as where you are located. Here are the factors that you need to consider in order to determine how best to get your bitcoins:
- Speed: How much of a hurry are you in to get some BTC?
- Amount: Are you looking for a few to play with, or a large volume?
- Convenience: Are you willing to jump through a few hoops?
- Anonymity/Privacy: Do you mind providing personal information and leaving a paper trail?
Here are some of the more common ways to get bitcoins, with their respective strengths/weaknesses:
LocalBitcoins.com – Depending on where you are, this may be the fastest, most anonymous way to get bitcoins. It’s a face-to-face exchange for cash, similar to buying something on Craigslist (safety first: use your judgment, meet in a public place).
Coinbase.com – Allows you to buy up to 10 BTC per day, with a low (~1%) fee. You just need to create an account with an e-mail address and link it to a bank account. Takes about 3-4 days to receive your bitcoins, based on the bank transfer. US ONLY
MTGox.com – The biggest and most well-established bitcoin exchange, this is where you go for large transactions. They can handle pretty much any volume, and serve pretty much the whole world (they are based in Tokyo). The downside is that they require identification verification, which can take a while (a week), and requires you to send scans of your government issued ID (driver’s license, passport, etc.), as well as proof of residency (like a utility bill). They also are just an exchange, so you have to fund your account from a third party like Dwolla or BitInstant.
This is by no means a comprehensive list, but this website can help you as well, especially outside of the US.