This is not a paid endorsement
This article shows you how to buy bitcoin from an exchange, using Bitaroo as an example. There are, however, many different ways to get bitcoin. Below are all the ways that I could think of, each with different trade-offs and levels of privacy:
How to GET bitcoin:
- Buy it from an exchange (Most common)
- Buy it from a broker (Easy but costs more)
- Get a friend to buy for you (Messy for tax reasons)
- Buy it directly, face to face (If from strangers, risk to personal safety)
- Earn it (A really good way to get bitcoin. Very private generally)
- Mine it (Don’t – Mining is not profitable for the little guy)
- Steal it (Don’t)
- Create your own Bitcoin (Don’t be a scammer – Find out why Bitcoin can’t be copied)
Buy from an exchange
There are many exchanges. Options available to you depend on where you live.
In Australia, I’ve used all the largest exchanges, and the best I’ve used is Bitaroo, which is the largest bitcoin-only exchange. It is an Australian based exchange that I personally use, and the one I recommend, as they focus on Bitcoin only, are cutting edge, and provide an excellent service.
This is the overview of the process:
- Create an account
- Provide some ID information
- Click on a verification email
- Send money from your bank to Bitaroo
- Spend government money (AUD) to buy real money (bitcoin)
- Generate a Bitcoin wallet if you don’t have one
- Withdraw bitcoin from the exchange to your own wallet
Create an account
Click the orange link, “Open Account”
Enter your details, check the “I agree” checkbox at the bottom and click “Create an account”. You will then be logged in, and will shortly receive a confirmation email.
Open the “activate your Bitaroo Account” email and click the link to activate.
You will be logged in to Bitaroo.
Verify your ID
When you log in you will be asked to verify your details.
Near the bottom, select “Passport” or “Driver Licence” and more fields will appear for you to fill in. Don’t forget to check the two boxes at the bottom after reading the text.
You will be taken back to Bitaroo, your deposit page.
Make an AUD deposit from your Bank
On the main page, you will see tabs at the top. Select the “Deposit” tab.
On the left are bitcoin Deposit details. That’s only for people who want to sell bitcoin. The entire left side can be ignored.
On the right are details you need to deposit money from your bank account to Bitaroo’s bank account. Bitaroo’s bank will receive your funds, and when cleared, your Bitaroo Account will be loaded with AUD for you to purchase bitcoin.
The fastest way to deposit money is to use PayID. Most banks would allow that. It is instant, although some banks have a policy to delay the first(s) ever deposit to any merchant you pay for 24 hours. Occasionally, I have seen friends’ deposits go in instantly, perhaps because those payments were under a threshold, eg $100.
A slower, more conventional way to pay is with an electronic fund transfer using the BSB and Account number listed on your deposit page. Enter those details in your banking payment, and send funds. The deposit limit is set to $10,000 for KYC level 1, details here.
I will show a payment from Commonwealth Bank using PayID:
You will need your Bitaroo Deposit page open, and you will need to copy the necessary details when prompted (See red circles below – These are the copy buttons you will use.)
Note: for Commonwealth Bank, PayID is available only with the mobile app as of writing. Open the banking app.
Click “Pay & transfer”
Select “Pay someone”
Select “Email address”
Copy and paste the email address from the bitaroo deposit page to your banking page
My daily limit is $100 million, so I will send just under that (Joking!). In the next window, copy and past the Reference, also found in your Bitaroo Deposit page.
Buy some bitcoin!
Once you are done, you may find that your Bitaroo balance has instantly been credited, minus the small deposit fee. Go back to the browser and click “Trade”
I’ll show you how to buy bitcoin with all the money you deposited, without finessing anything. Just a simple buy at the market price. An even easier way to buy is with “Express”. It ends up costing a tiny bit more, but you may appreciate the convenience. I made a video on how to do that.
For buying in the market, proceed as shown:
On the trade page, on the left, there is a field for you to enter purchase details. Change the “limit” option to “market”
After that, the fields will change slightly. Click the green button to automatically calculate how much bitcoin you can buy with all your money at the current price. Then click “Buy BTC” and accept the confirmation. (Note: the red max button is for selling. I’ve never used it)
Congratulations, you have bought some bitcoin.
Note, sometimes, if the price changes after you press the “max” button, you may have a few cents left in your account. In that case, just repeat the process to buy, to spend the remainder.
Withdraw bitcoin – “Your keys, your bitcoin, not your keys, not your bitcoin”
Next, it is best practice to withdraw your funds to your own personal wallet. See this article I wrote to find out why and how to store bitcoin yourself; you’ll need to make a wallet and the article teaches you how.
Now that you have your wallet, let’s move the bitcoin you just bought to that wallet. Click the “Account” link at the top again, and then click “Withdrawal’
There are 4 steps from here.
- Copy an address from the “Receive” page on your own Bitcoin Wallet.
- Paste that text into the “Withdrawal Address” field on the Bitaroo Withdrawal page (See below, top circle shown).
- Select how urgently you want the funds cleared in your wallet. I’m usually patient and I’m happy to wait a week or two, so I select “Economy”, instead of “Standard” or “Priority” – this saves on fees.
- Finally, click “max” to withdraw all your bitcoin. Then confirm.
If you don’t immediately see some confirmation that funds have been detected in your wallet, it’s usually an issue with the software you are using. You can go to mempool.space, and paste the address that you used into the search bar at the top, and you’ll see some funds in that particular address. Initially, it is “unconfirmed” and later it will be “confirmed”. An alternative is to look in your Bitaroo Withdrawal page and click the transaction link.
Congratulations! You signed up to an exchange, moved government money, purchased bitcoin (free-market money), and stored it in your own custody.
The next thing to do is repeat. Regularly buying and saving in bitcoin is likely to be a good strategy (not financial advice). To might wish to set up an automatic recurring purchase using Bitaroo’s DCA feature (dollar cost average).
This will purchase bitcoin without your ongoing input, provided you maintain sufficient funds in your account. Use the Trade Page and change “limit” to “Recurring Buy (DCA)”, an example is shown below:
If you don’t know why you should continue to accumulate bitcoin, I suggest you urgently learn what bitcoin actually is and decide for yourself. This is a syllabus for learning more.
Eventually, if you have time, you may be interested to run a Bitcoin Node. This explains why it’s a good idea (6 reasons).