One has several options today when it comes to buying Bitcoins. First you choose among mining and buying this cryptocurreny. I will focus on latest in this blog post.
Here in Slovenia there are number of way about how to buy Bitcoins. You can do it on gas station, even on ATM. What I would like to war people thinking about this possibility is that you will probably pay very high fees (around 4% in the time of writing). With huge upward trend in Bitcoin price and if you are a long-term investor, this might not be an issue for you, but if you plan to step in and out of Bitcoin regularly, to trade it, than you might want to search for a more cost-effective solution.
One possible way is by using a wallet, which has an exchange functionality integrated. That means nothing else but Wallet is in cooperation with one or more exchanges, to covert fiat money into crypto and vice versa when necessary. You can usually also convert one crypt into another. In this case a wallet offers you more or less most of the exchange features, except trading platform. Such a wallet if for example Coinbase. You can expect around 1.5% fee on your transactions.
And finally, the cheapest way for trading Bitcoins is directly on the exchange. What you get with exchange is low fee and a trading platform. As one could expect, exchange differ among each other and you need to do your homework and check which one suits you best. While some exchanges offer number of cryptocurrencies to trade, others will offer you only few most popular ones. Next you will see that some of them have very powerful trading platforms with number of trading possibilities, while others are week in this area. And so on and so forth.
One of the best exchanges for trading Bitcoins, at least for Slovenians and Europeans, is definitely Bitstamp. Trading fee is 0.25%, you don’t pay anything extra but your banking fee for depositing and withdrawing the money to the exchange, and most important, their trading platform is just superb. I have been working for over 10 years in brokerage business and must say that a platform like that for trading stocks was just something we just a wish idea. I suggest you to give Bitstamp a try…
What I would not recommend for trading Bitcoins is using Forex, CFD and other types of derivatives brokers. They will offer you margin accounts, which will further increase the Bitcoin huge volatility and expose you to an even greater risk. Besides, you have to report and pay taxes on derivatives, at least here is Slovenia and the tax rate is 40%. Trading Bitcoins directly is tax free.