For almost half a year now, the number of articles, eBooks, press releases and news pieces regarding Bitcoin and their closest cousins have been increasing exponentially. Digital assets have taken the over the internet as regular individuals try to look for efficient payment systems.
Right after this currency crossed the $1000 mark and continued to defy the odds by making its early investors filthy rich, most bystanders decided to climb on board. Even after hitting an all-time high of 20k and flopping back to below 10k, the currency is still attractive to many people.
If you are interested in knowing how you can buy BTC with a bank account, tag along.
How to buy with a bank account
There are several ways for people to get their hands on some Bitcoins (or at least a fractions of them since they have become a bit expensive nowadays). The most common method accepted by many brokers and sellers is through a bank account.
Let’s walk over the exact steps you need to follow in order to get your hand on some bitcoins (sometimes called Satoshis). In the steps below, we will use Coinbase as an example since its friendly to most newbies. The method may actually not vary a lot from that adopted by other exchanges.
Step one: Open an account
Most exchanges won’t allow you to interact with their platform without first signing up. To buy bitcoins, first prep all your official documents from passports, IDs, a recent bill, Social security number, driver’s license (front and back), webcam, email, and phone number.
There are strict laws in the US, UK and other territories so these items listed above should help you smoothly navigate through the account opening and verification stage.
Step two: Verify the account
Verify you email by following instructions sent there by Coinbase (or whichever exchange you are using). Always use the same device you used to open an account; there have been instance where individuals have a hard time verifying from tablets, smartphones and other gadgets.
Step three: Connect a bank account
Link your bank to the account to make it easier to send and receive money from the platform. You can always use your debit and credit cards if you feel uncomfortable using your bank. However, there is an extra fee charged for that alternative option. You will also need to upload documents to facilitate the verification process. Always follow the command prompts and provide any details asked.
If everything went well, you should see a pop up indicating “Identity verified.”
Step 4: Purchasing your coins
Now that you have an account on an exchange, log in using the exact details you provided during sign up. Once inside, check for “buy” and click on it. Then select bitcoin and when redirected to payment method, pick “bank.” Coinbase usually requests you to key in your weekly limit before finishing up the process.
Voilà! You are now a bitcoin owner; well if the coins show up in the next few seconds. The waiting period is anywhere between a few seconds to a week. Buying methods vary slightly from one exchange to another. It’s imperative to check or ask out how the process looks like before opening an account to avoid any frustrations.
Is the process the same if I reside outside US or EU?
No, the process can be different for those who live outside US and EU. Some exchanges have limits to countries they cover and it’s essential you double check if your location is listed on their servers before signing up. Nevertheless, you can still buy bitcoins using your bank account but via SWIFT.
Pre-requisite for buying Bitcoin
Before you begin the earning process, you first need a place to store your virtual currency. You can create your Bitcoin wallet on the internet through different online providers. There are lots of providers out there and they create your wallet for free. There is another way to create your wallet, which is to download a Bitcoin wallet so that you can store your Bitcoins (or fractions of one BTC) on your computer, thus keeping your storage offline.
Be wary which client software you use. The best wallet should be able to interact with a blockchain without necessitating a download. For some, you’ll be needed to download the entire blockchain on your PC and that’s a lot of space and bandwidth no one is ready to provide.
Once your client has the updated blockchain installed, you can proceed to make a new wallet address. At that point, you are now ready to store Bitcoins. Take note of your wallet address, or Bitcoin address, since that will serve as your ID.
Without it, other people (and businesses) won’t be able to send you some BTC. This is the same ID you will use when making other transactions using Bitcoins. Your wallet address is an alphanumeric code that is about 34 to 36 characters long.
TIP: It will be a good idea to keep a copy of your wallet.dat file in a separate storage device, like a thumb drive, SD card, or some other form of external data storage. You should also print it and keep it in a secure and safe location. Do not disclose its contents or the data contained in it. That’s the ticket for other people to steal all your Bitcoins.
While internet-created wallets are easy to create and sometimes free of charge, they are not recommended. Hot (online) wallets can give in to hacks and cost you your precious coins. The best alternative is to buy an offline hardware wallet like Trezor or Ledger. They do provide top-notch security and easy recovery back to your account in case you forget the login credentials.
Exchanges that accept bank wire
Despite facing a lot of issues lately, Coinbase is still one of the best and largest bitcoin brokers. Those in the US can buy some BTCs through bank wire (Usually ACH bank transfer). Europe citizens can do so through SEPA transfer. Americans have the option to add a MasterCard or Visa to their banking details to activate instant bank transfer payments.
Bitpanda is a reliable bitcoin broker that accepts bank wire payments via SOFORT, Online Bank Transfer, and SEPA. Their charges are pretty competitive even though the rates are not openly displayed on their website.
GDAX too accepts bank wire payments for anyone looking to buy bitcoin. They have some of the lowest rates. The problem with this broker is their newbie unfriendly interface. Other exchanges where you can buy bitcoins using your bank account include CEX.io, Gemini, Bittylicious, Coinfloor, Coinfinity, Paymium and a couple others.
The bottom line
There are many methods of buying bitcoin; you can use Paypal, Credit and debit card, Skrill, Neteller, as well as bank account.
With many exchanges being compelled to adhere to “Know Your Customer” rules, providing a bank account has now become mandatory. While this method means your personal details can be tracked, it’s still one of the most reliable ways to buy bitcoin.
If providing an exchange with your bank details gives you Goosebumps then perhaps you can check out other exchanges without bank wire method.