Buying Bitcoin or other cryptocurrencies in the UK is not a straightforward process. This guide will walk you through the basic steps of buying Bitcoin, DASH, ETH or other cryptocurrencies in the UK.
Register With a Trading Platform
Before you begin trading, you’ll need to register with a Cryptocurrency exchange platform such as Coinbase or Kraken. Trading platforms or exchanges as they are often known enable you to
- Buy and sell cryptocurrencies
- Store your purchased cryptos
- Transfer money in or out from your crypto balance to you bank or credit card
Registration is similar to setting up any online account whereby you enter your email address, create a password and enter some personal info. This stage is pretty easy for all of the platforms I’ve tried, but this is where the easy part ends. The next stage is to verify your identify which I’ll tell you about in the next section.
To comply with local financial regulations and to prevent money laundering etc., all trading platforms will require you to verify your identity using various and very personal forms of ID. Most platforms will expect you to upload pictures of your drivers license, your passport, your credit card or even a picture of you holding your credit card. The exchange platform Cubits, carries out ID verification using the IDnow service. IDnow requires that you download their app on to your phone which sets up a live video call with some guy in Germany, who guides you to hold your passport in front of the phone camera while he takes control of your phone to take pictures from various angles!
Top Up Your Trading Account
Buying cryptocurrency obviously means you’ll need to pay out some money. Unlike online stores where you add your stuff to the basket, go to the checkout page and pay using your credit card, trading platforms require that you pay some money in up front. In a way it’s like a bank account which sits on your money until you’re ready to transfer it into a different currency. Different platforms offer varying top-up methods. Some involve registering your bank card, others involve electronic transfers from your bank account. In the UK it gets tricky because of fees and restrictions imposed by some banks.
Most platforms charge fees to accept monies into your account ranging from a minimum of £5 up to £15. Since platforms are often located outside the UK your bank will charge you £8 to £25 for international electronic transfers. In addition, international transfers will probably incur foreign exchange transaction fees which can add around 3%.