Editor’s note: This article was originally published in late 2017 when Bitcoin was approaching $10,000 per coin. At the time of this update, Bitcoin trades above $100,000. The referral link and bonus offer have been updated to reflect Coinbase’s current program. Everything else stands as written – the basics haven’t changed.
Internet technology is not just about websites and mobile apps – there are new technologies emerging every day, and not all of them are obvious until they’re not so new anymore. This post is specifically targeted toward those with little to no experience who want to simply get started with Bitcoin.
You’ve heard about it, you’ve read about it, you’ve seen it on the news, but you have no idea where to start. And that’s ok – the technology behind Bitcoin (the blockchain) can be confusing to those outside the technology sector. The most important thing to know is that you don’t need to buy an entire coin. You can invest as much or as little as you like. Starting with $100, you can buy a fraction of a coin and get a feel for how it works before committing more.
Start With Coinbase
Bitcoins are traded on various exchanges, but the simplest starting point is Coinbase – the largest and most beginner-friendly Bitcoin exchange. They are well-established, insured, and designed specifically to make the process of buying, selling, and storing bitcoin straightforward for new users.
The process is three steps:
1. Sign Up for Coinbase
Create your account at Coinbase. This gives you a secure place to store your bitcoin and easy payment methods to convert your local currency into or out of bitcoin.
2. Connect Your Bank Account
After signing up, connect your bank account and complete the verification steps. Once verified, you can start a purchase. You can also buy with a credit card, but the fees are slightly higher. Bank transfers are the most cost-effective way to fund your account.
3. Buy Bitcoin
After starting your first purchase, Coinbase completes the buy and delivers your bitcoin. The price changes constantly, so they show you the current exchange rate before you confirm. Sells work the same way in reverse.
That’s the basics of it. The current referral program gives you 30% of spot fees earned when friends you refer start trading – details on the Coinbase referral terms page.
Beyond Bitcoin
As an alternative to Bitcoin (BTC), the two most established alternative coins are Ethereum (ETH) and Litecoin (LTC). After your first BTC purchase, you can diversify into other coins through the same platform – but start with Bitcoin to get familiar with how it works.
As with any financial endeavor, there is risk involved. Never invest more than you can afford to lose.
Worth Knowing
When this article was first published, Bitcoin was trading at under $10,000 per coin. It has since surpassed $100,000 – making it one of the best-performing assets of the past decade by a significant margin. That doesn’t guarantee future performance, but it does suggest the technology was worth paying attention to when most people were still skeptical.
Source: CoinDesk – Bitcoin Price Index
