Introduced in 2008 by the mysterious Satoshi Nakamoto, Bitcoin has enjoyed an enormous rise in value as it was the first cryptocurrency in the crypto market.
Bitcoin is a decentralised currency with no single administrator or control. It is also not governed by any Central Bank.
Bitcoin is based on blockchain, a distributed ledger of nodes for transaction recording. It processes and validates its transaction with mining activity, a reward for supporting blockchain networks and processing transactions.
There are many ways to buy Bitcoin and other cryptocurrencies. However, as popular as cryptocurrencies are, there are still questions and concerns about the best ways to buy Bitcoin in the UK.
You can buy Bitcoin or any other cryptocurrency via a broker or an exchange platform. A broker works as a middleman that facilitates market transactions or trades of cryptocurrency.
On the other hand, a crypto exchange brings parties together directly to trade with each other. For example, buying X amounts of BTC for Y amounts of XRP.
The main difference between these two methods is that traders go directly to the seller or buyer with an exchange rather than through an intermediary as seen with a broker.
Table of Contents
How to Buy Bitcoin in the UK Using Our Preferred Trading Platform: eToro
1. Sign up with eToro
Buying Bitcoin with eToro requires a verified eToro account. To create an account, visit eToro on your web browser. Register for a new account by selecting the JOIN NOW option. A registration form to fill in your details will pop up after.
2. Account verification
After inputting your details, you should verify your email address and complete your profile before the identity verification.
Once your profile is complete, verify your proof of identity with a clear picture of your passport or driver’s licence and also a proof of address with utility bills like internet bills and bank/credit card statements.
3. Deposit fiat currency
Once the verification is complete, you can fund your account before buying Bitcoin. To do this, choose your preferred deposit method, as illustrated in the picture below.
Link your e-wallet or bank to your eToro account. After the deposit has been confirmed, deposited fiat currency will reflect in your eToro account.
4. Navigate to Bitcoin and make a purchase
Once you’ve funded your account, proceed to the CRYPTO section of eToro, input the desired amount and make your first BTC purchase on eToro.
5. Bitcoin is now added to your eToro portfolio
Once your order has been confirmed, an equivalent value of Bitcoin will be added to your portfolio.
Best Ways to Buy Bitcoin in the UK
1. eToro
eToro is the best and most straightforward way to buy Bitcoin, as you can see from the detailed steps above.
What makes it an excellent option for purchasing Bitcoin in the UK is its extremely low fees, wide range of transaction types and high liquidity.
| Pros | Cons |
|---|---|
| Straightforward account registration | Fiat deposit is limited to USD only |
| Large crypto listings of 42 cryptocurrencies | Does not offer non-crypto investments to US traders |
| Social trading and copy trading function | High withdrawal and non-trading fees |
| Low deposit and withdrawal threshold | |
| Offers access to non-crypto investments like ETF, commodities, stock, and forex trading |
eToro also offers other beneficial services like social trading and copy trading, enabling new traders to better understand the market. It also aids in making stringent marketing decisions—for instance, the perfect time to buy Bitcoin.
This aids new traders to learn more and make better decisions to become profitable traders.
Another perk of using eToro is its free trading fee and free commission for trades. However, there is a slightly high fee of $5 on withdrawals.
Also, eToro accepts only USD fiat deposits. This implies that UK users may have to pay an additional GBP-USD conversion fee.
Also, there is a spread fee on all trades. However, the exact amount of the spread fee depends on market factors, although this is normal for every broker or exchange platform.
eToro also features many enticing features, including a wide range of transaction types, such as limit orders, and advanced buy and sell order types. Also, it supports 42 cryptocurrencies and 43 trading pairs, including top market cap coins like Bitcoin.
eToro is an excellent platform for investors looking to diversify their portfolios as they offer options for crypto and non-crypto investment management. Additionally, in contrast to other platforms, eToro is a high liquidity platform that helps traders execute trades swiftly.
Apart from its comprehensible interface and low costs, eToro also offers a built-in wallet that makes it easy for beginners to conveniently manage all of their investments in one place.
Other advantages include excellent spread, which fluctuates according to market factors. However, it helps manage liquidity which aids traders to trade optimally.
Its main drawback is the USD-only fiat currency deposit which can slightly impact UK users by paying an additional exchange rate or spread fee. However, this can be mitigated by using e-payment options that offer better rates, e.g. Wise.
2. Binance
Binance is another great crypto platform for buying all sorts of cryptocurrencies, including Bitcoin in the UK. Binance is the world’s largest crypto exchange with more than 350 coin listings.
| Pros | Cons |
|---|---|
| Swift and free account funding | Although the trading commission is cheap, other exchange platforms do not include these fees |
| Extremely wide range of coin listings, the largest in the crypto market | Complicated UI is mainly designed for experienced users |
| A wide range of supported transaction types |
Binance is a particularly excellent alternative. It has a high number of active users, increasing its liquidity to help traders execute trades optimally and eliminate the catastrophic impact of illiquidity when trading.
Its high liquidity is also useful for day traders and scalpers who want to quickly enter or exit trades, especially during major swings.
In addition to this, Binance offers the lowest fee structure in the market. It offers fee deposits via bank transfer for UK users. It also charges between 0.02% to 0.1% fee on purchases and a 3% to 4.5% charge for debit card purchases.
Binance supports many transaction types, including limit order, market order, stop-limit order, trailing stop order, post-only orders, peer-to-peer trading, margin trading, and one-cancels-the-other order. Therefore, it is suitable for every advanced trading strategy.
Also, due to a high number of active users, Binance offers a high level of liquidity, however, it doesn’t use outsourced liquidity like eToro. This could expose users to risks of illiquidity at any time. Fortunately, this is a less common issue with Bitcoin trading compared to other coins.
Generally, Binance is an excellent option for buying Bitcoin. It offers great features for a low fee. It also offers fast and old shifting account funding methods and a wide range of transactions, giving room for every trading strategy.
However, one con about Binance is that despite its cheap trading fees, they are mostly free with other crypto platforms like eToro. Also, its user interface is complex and can cause a bad user experience for new users.
3. Crypto.com
Another good alternative to eToro and Binance is Crypto.com. Due to additional features, Crypto.com makes a great alternative for buying Bitcoin.
| Pros | Cons |
|---|---|
| Provision of up to 14% interest on cryptocurrency | Complicated user interface which can be difficult to navigate |
| Cashback opportunity of up to 8% with their VISA card | Funding of account is only in USD; therefore it may incur an additional fee for non-US users |
| Offers a wide range of coin listings |
Crypto.com offers interest on deposits of up to 14%. Also, it offers a VISA card that offers up to 8% cashback to traders. Moreover, the card can be used to spend cryptocurrency, paving the way for more usage.
Crypto.com charges one of the lowest trading commissions, and it ranges between 0.04% to 0.4%.
It offers interest on deposits and cashback for using their VISA card, which is an efficient way to spend your cryptocurrency. Crypto.com also offers various transaction types to support traders of all levels, especially advanced traders.
The main disadvantage of using Crypto.com is that it only accepts USD fiat deposits which can incur an additional fee for UK users. However, this can be controlled by using e-payment services like TransferWise.
What Is Bitcoin?
Like every other cryptocurrency, Bitcoin is an open-source, decentralised cryptocurrency. However, unlike many other cryptocurrencies, it lacks the support for smart contract functionality.
Bitcoin is the largest cryptocurrency by market cap. It has a market cap of more than £680 billion and a 40% market dominance.
Currently, Bitcoin is trading at nearly £36,000, almost 10 times the second-largest coin by market cap, Ethereum. It is also one of the most valuable cryptocurrencies.
Why Buy Bitcoin?
Bitcoin is a potentially profitable investment compared to other cryptocurrencies. It is the most widely accepted cryptocurrency that is responsible for the growth and adoption of cryptocurrency as a payment form.
It can also be used for the exchange of goods and services.
The massive adoption of Bitcoin is one of the factors responsible for its high price. Although it is more stable than other cryptocurrencies, it is very volatile and can incur high risks.
Another reason to buy Bitcoin is its higher liquidity level than other cryptocurrencies. Unlike other cryptocurrencies, Bitcoin’s high liquidity is an added perk for traders as it makes it easier to enter and exit trades quickly during periods of high volatility.
Being the coin with the highest liquidity, it has the largest probability of hitch-free buying and selling. This helps reduce risks of additional loss and maximise gains.
However, Bitcoin is not always liquid, as there have been a few times when it suffered from illiquidity. Still, it is still the only coin with the highest level of liquidity.
Bitcoin Price Analysis and Prediction
Bitcoin and the general crypto market saw a huge uptrend in Q1 2021, seeing Bitcoin to an ATH of £46,000 in April 2021. It only took a few days before it tumbled back to £23,000 in July 2021. This huge drop was due to general market conditions as other cryptocurrencies dropped in price too.
Bitcoin has an unpredictable price action and whether it will continue in a bullish or bearish direction is still speculation for expert traders.
Unfortunately, severe impacts and actions of Central Banks, regulators and most especially the Chinese government have been unfavourable to Bitcoin even though it holds enormous power in the decentralised crypto world. Also, there are concerns over the hazards of Bitcoin mining which could also pose a threat to its potential growth.
Bitcoin is recovering from a dip with a good percentage of growth. However, there is a possibility that other coins may recover better than Bitcoin in the bullish run. Meanwhile, its price action is still unpredictable even to expert traders.
Things to Remember Before Buying Bitcoin
Don’t put in more than you can afford to lose – Bitcoin is a high-risk and high-reward investment. You can gain as much as you can lose; therefore, it is vital to cut your coat according to your size with crypto investments.
Resist ‘fear of missing out’ – Trading on emotions is another mistake you should avoid. In trending market conditions, emotions can take over when you see the price going up when you’re out of the market. However, strictly follow your trading plan and strategy and avoid trading on emotions.
Understand tax consequences – Everything is subjected to tax, and cryptocurrency is not left out. Ensure you understand the tax liabilities of owning a crypto asset and comply with them.
Long vs. short-term investment – Before investing in Bitcoin, consider the pros and cons of short or long-term investment and choose what works best for you. Also, ensure you choose a platform that supports your preference and trading strategy.
FAQs
Is Bitcoin legal in the UK?
Yes, buying Bitcoin and other cryptocurrencies in the UK is legal.
Will Bitcoin be overtaken as the most valuable cryptocurrency?
Although some experts believe Bitcoin can be overtaken as the most valuable currency, it generally depends on the value of other cryptocurrencies. Beyond being a store of value, any cryptocurrency that will overtake Bitcoin as the most valuable cryptocurrency must have a wider range of applications like Ethereum powering NFT and other DeFi. However, Ethereum is still worth less than 1/10 of Bitcoin.
Can you buy less than 1 Bitcoin?
Yes, you can buy less than 1 Bitcoin with fractional trading. This enables you to purchase fractional parts of a whole coin.
Is it too late to buy Bitcoin?
Bitcoin price, like other cryptocurrency prices, is hard to predict. However, the general crypto market is in a dip and may recover soon, making it a good time to buy Bitcoin. Also, the introduction of greener technology for Bitcoin can raise its price.