Buying Bitcoins (the newbie version)
This page aims to be the best resource for new users to understand how to buy Bitcoins. The existing Buying bitcoins page is too complex, and not transparent enough for new investors. Be extremely careful when buying bitcoins from not accredited websites or individuals. Like in the real world there are many scammers around.
Warning: Please be careful with your money. When sending money to an exchange or seller you are trusting that the operator will not abscond with your funds and that the operator maintains secure systems that protect against theft -- internal or external. It is recommended that you obtain the real-world identity of the operator and ensure that sufficient recourse is available. Because Bitcoin services are not highly regulated a service can continue operating even when it is widely believed that it is insecure or dishonest and webpages recommending them (including these) may not be regularly updated. Exchanging or storing significant amounts of funds with third-parties is not recommended.
Intro
You can't reliably buy Bitcoins using PayPal or credit cards, because it is risky for the seller, and therefore few sellers will offer this. There are basically 4 reasons for that:
- The TOS of PayPal actually prohibit buying digital currency with it
- The buyer of bitcoins can always perform a chargeback and there is no way for the seller to contest that
- There are many hacked accounts and when PayPal realizes that such an account has been fraudulently used, they will also perform a chargeback
- PayPal doesn't like bitcoin, as the bitcoin network is in direct competition to it
There are several ways, depending on your location. Many sellers online will trade bitcoins for moneypak codes. See http://www.moneypak.com/
Via Bank Transfer (US)
Coinbase allows you to buy and sell bitcoin by connecting any U.S. bank account. Unfortunately, the site only sells a limited number of bitcoins each day. When demand for bitcoins is high, most purchase attempts return a message which indicates that you have hit the system-wide (not per user) limit on total bitcoin sales and suggests that you try again around 6am EST the next day.
Via Bank Transfer (EU)
Bitcoin-24.com charges very low fees for SEPA transfers within the EU.
Finding a direct seller online
If you can find another person that is willing to sell them to you, you can transfer him money via whatever method (including PayPal), and he'll send you the Bitcoins. The following websites can be used to find direct sellers online Bitcoin OTC, Bitcoinary or the Currency Exchange Forum Section. Be extremely cautious when using those methods, the best way is to ask an admin, moderator or a trusted person.
Physical Trading
You might be able to find an individual you can Buy bitcoins locally. Always choose somebody with many reviews.
Bitinstant
You can buy Bitcoins via cash deposit or bank transfer using BitInstant. Here is a video tutorial explaining BitInstant: http://vimeo.com/44849463
Exchanges
The largest and most trusted exchange is MtGox. For a list of other major exchanges see Major Exchanges
Blockchain (UK)
UK users can use Barclays PingIt or Bank Transfer to purchase bitcoins from blockchain.info.
Instant bank transfers within the EU and UK
Buy bitcoins via the instant Sofort network through Bitcoin-24. It is a very fast, easy and secure method to deposit Euro instantlly.
Avoiding Scams
Before using any service it is a good idea to look for reviews and feedback from previous customers. This can be done by simply googling the name of the website or company. The bitcointalk forums are also a good place to find discussions and reviews about services.