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How to Buy Bitcoin Through Your Local Bank (and Coinbase)

By Edited May 22, 2015 0 0

The Time is Now

In the aftermath of the Mt. Gox debacle (see "Can Bitcoin Survive?"), bitcoin seems to be taking a breather. Prices for the volatile cryptocurrency have been remarkably stable in recent weeks, and are currently hovering around half the historical highs of late 2013. If you believe in the future of crypto and have been waiting to buy in, this might be an excellent time. (Standard investment disclaimer: if it crashes tomorrow, don’t come looking for me!)

The Dark Ages

In the early years of bitcoin, buying in was a challenge, though it certainly paid off for the very early adopters, some of whom picked up huge quantities at a fraction of a penny! Before the exchanges, you had to buy or barter directly from someone who already had them (e.g., a miner).

Coinbase to the Rescue

When proper exchanges came along, things got easier – but not by much, at least not for U.S. citizens. Restrictive banking and securities regulations effectively kept exchanges from operating in the U.S.; even today, all the major exchanges are on foreign soil – and it is difficult to fund accounts at these foreign exchanges with dollars.

Though there is still no major exchange in the U.S., there is a fully compliant, well-established, and very professionally run bitcoin broker. Based in San Francisco, Coinbase allows you to buy and sell bitcoin directly, through ACH transfers to and from your U.S. bank account.

Instant Bitcoin

Full compliance with banking regulations requires some identity verification steps, but once you’re fully qualified, you can buy or sell up to $50,000/day in bitcoin. Even better, at the highest level of verification you can buy up to $1,000/day instantly. 

That means your bitcoin are available immediately, instead of several days later when the ACH withdrawal goes through. So if you want to buy the hottest new alt coin at your favorite exchange – but are out of bitcoin – you can instantly get more on Coinbase, then transfer the bitcoin directly to the exchange. (You still have to wait for the blockchain, of course; that’s unavoidable.)

Let's Get Started

The documentation is excellent, and it’s very easy to get started. Follow the link below to Coinbase.com, create an account, connect your bank account, and get in on the cryptocurrency revolution.

(Note: using this referral link gets you $5 in free bitcoin when you complete a purchase of $100 or more, about 0.15 BTC at current prices.) Sign up with Coinbase

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Bibliography

  1. "Bitcoin Historical Charts." Coinbase charts. 17/03/2014 <Web >
  2. "Mining." Wikipedia. 17/03/2014 <Web >

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