Bitcoin 101: Buying Bitcoins Part 1: Using Exchanges
Bitcoin faucets are all well and good but what if you want to own enough to actually use in daily life?
In that case, buying Bitcoin is the easiest place to start. Since Bitcoin is a currency, buying Bitcoin means you’re actually just exchanging your money for another kind of money, similar to buying dollars or any other kind of national currency.
To buy Bitcoin, you need to go to an exchange, of which there are several types.
Buy and Sell Exchanges Buy and Sell Exchanges are sites that are the most similar to the foreign exchanges we’re familiar with here in the Philippines. These sites have a set buy and sell price, at which people can obtain or sell off their Bitcoin at.
The process here is simple; just go to a trusted exchange website, check out their prices, and decide if you want to buy there. Once you have decided, you will have to sign up (usually a one-time thing) with the service so you can place an order. Once an order is placed, you will then have to go to a bank and pay for your Bitcoin. You will be asked to show your proof of payment to confirm the transaction. Once confirmed, the exchange sends you your purchased Bitcoin right away.
When familiarity with Bitcoin is low, these kind of exchanges dominate, as we see locally. Notable Buy and Sell Exchanges include:
xbt.ph + rebit.ph
buybitcoin.ph
coins.ph
coinxchange.ph
Peer to Peer Exchanges Localbitcoins.com allows person-to-person transactions through their website. Their service lists users looking to buy and sell Bitcoin near your location. You can then pay or be paid through cash upon meet up, bank deposit or through local remittance services (if preferred by the seller). Once payment is confirmed by the seller, Local Bitcoins send the purchased Bitcoin along to you.
On Peer to Peer exchanges, individual users set the price so may see premium pricing at play. Always compare prices and user reputations before making a trade.
localbitcoins.com
Order-Book Exchanges Order-book exchanges allow for a more professional type of trading and is usually where the global price of Bitcoin is determined. Similar to LocalBitcoins, Bitcoin buyers and sellers set the price they want to buy and sell their Bitcoin at, contributing to the site’s book of orders. The exchange matches and fulfills the orders automatically.
Due to the volatile and sensitive nature of the Bitcoin market, we recommend that you do extensive research before deciding to actively trade on order-book exchanges. Remember too, that unlike traditional markets, the Bitcoin market never stops trading!
Some examples of order-book exchanges accessible in the Philippines are:
Coinage.ph
Btcxchange.ph
Bitstamp.net
There are many, many ways to buy Bitcoin nowadays, and almost all of them are guaranteed safe and secure, but you can never be too careful. Research and due diligence on websites and companies you plan to transact with is a must!
For a handy comparison tool of local exchanges, check out http://btcphp.com
(Disclaimer: Coinage.ph, xbt.ph, and rebit.ph are part of Satoshi Citadel Industries.)