How to Buy Bitcoin in
Making Crypto Simple
If you are looking for a quick way to buy bitcoin in Canada you can find our easy step-by-step below. Check our list of the best crypto exchanges in Canada if you want to compare the different exchanges you can trade on. For the below guide we’ll be showing the process on our most recommended cryptocurrency exchange.
How To Buy Bitcoin in Canada
- Register an account on Bitbuy
- Verify your identity/account
- Choose a payment method
- Deposit CAD
- Click on “Express Trade” in your dashboard
- Click “Buy” on Bitcoin
- Enter the amount of CAD you want to spend or how much BTC you want to buy
- If you have any trouble with the above steps, you can reach out to their support team 🙂
If you are looking for more detailed guides, you can find them below.
Where To Buy Bitcoin
We’ve reviewed over 100 exchanges across the globe and have been doing this for many years. We are confident that Bitbuy is the best exchange in the world for people in Canada to use.
Learn More About Bitcoin
In the last couple of years, Canada has become a true leader in cryptocurrency innovation. Even though the Canadian government was slow to recognize the potential of the industry, it has managed to make up for the slip in its own way. Toronto, for example, has an entire institute dedicated to blockchain research.
The attention and excitement around cryptocurrencies in Canada make this country a strategic place for Bitcoin traders, and that’s exactly what has motivated us to create our guide.
Not only are we going to talk about buying Bitcoin, but we’ll also cover the history, characteristics, and shortcomings of this asset. In the end, we’ll let you decide whether Bitcoin is something worth your time and money.
Bitcoin (BTC) is the world’s first and most popular cryptocurrency to date. The technology used to create Bitcoin is what makes it stand out from other forms of digital coins. Bitcoin’s integrity is enforced with cryptography which controls the engendering of these tokens, their validity, and security.
The History of Bitcoin
Developers first started contemplating the idea of creating digital coins back in the late 80s. The disintegration of the financial system and its centralization, the disappointment in financial institutions, and finally, the global financial crisis in 2008, were their biggest motivation.
However, it took them over 20 years to devise solutions to challenges such as how to vouch for the coins’ authenticity and prevent anyone from double-spending them, or how to make the system secure without installing a central authority in charge.
On October 31, 2008, an individual (or maybe a close group of individuals) using the pseudonym Satoshi Nakamoto, published a white paper on Bitcoin and its technology, called Bitcoin: A Peer to Peer Electronic Cash System. The paper introduces the digital asset and discusses its place and importance in the future decentralized electronic financial system as imagined by the crypto community.
It defines the mechanisms of blockchain technology, a new technology for recording and permanently storing transactions on a digital ledger in chained blocks of data, and the timestamp server that prevents their double-spending.
Users can volunteer to become Bitcoin “miners” who have special mining hardware on their computers (also known as nodes) that allows them to generate new coins and verify transactions. This proof of work process consists of solving a complex mathematical problem by hashing the incoming data and then timestamping it.
Bitcoin was officially launched at the start of 2009 as open source software for anyone to download and improve. The first “Genesis” block was mined on January 3, 2009, by Nakamoto himself, who also made the first-ever Bitcoin transaction by sending 10 BTC to Hal Finney on January 12.
The next major step forward took place in October 2009, when the New Liberty Standard set an exchange rate that priced Bitcoin against the US dollar for the first time. At that time, you could purchase around 2,300 BTC for only 1 US dollar! This rate was determined in relation to the electricity costs for mining bitcoins.
Investing in Bitcoin was getting more and more attention, so the first Bitcoin exchanges appeared in 2011, together with some new cryptocurrencies. The crypto industry was gaining traction, driving Bitcoin’s price to new heights. At the end of 2017, 1 BTC was worth an incredible $20,000!
The price eventually climbed down, but it proved that Bitcoin was just starting to gather momentum and more and more traders were having their go.
Why Was Bitcoin Created?
If it wasn’t for Bitcoin and the rest of the cryptocurrencies, the only way in which we could make transactions and send money locally or internationally would be through centralized financial institutions (i.e. banks).
The problem with this level of centralization is multilayered. First of all, for your transaction to be accepted by the institution, you need to provide details about yourself and the person or company you’re sending money to. Often, you need to specify the reason for sending that money.
Next, these transfers can take up to a couple of days in cases of cross-border payments. The reason? Unstable online infrastructure, different currencies and their exchange rates, and the need to reach out to foreign financial institutions and get their approval. Still, customers pay hefty fees for these services.
How and why is Bitcoin different then?
To begin with, Bitcoin transactions are conducted online, on digital ledgers operated by a peer to peer network with no middlemen. Transactions are listed publicly, in a transparent manner, but instead of disclosing the names of the senders and receivers, what people see is their encrypted public addresses.
Moreover, users are completely exempt from high transaction fees. They need to add a small amount to motivate the miners to continue doing their job, as their main source of profit comes from the Bitcoin mining reward.
Bitcoin’s Pros and Cons
The first negative thing people hear about Bitcoin is that it can’t be used as a stable store of value due to its volatile nature. Yes, it’s true that Bitcoin had numerous sharp price fluctuations in the past, but that doesn’t make an asset unrewarding.
On the contrary, for a lot of traders, this is the main reason why they’re so attracted to Bitcoin. Like the idea of speculating on its price or investing and then holding onto their coins until the right moment comes to sell them.
Bitcoin might not be the best currency for everyday purchases (at least for now!), but it proves to be a lucrative long-term investment, not only for early birds who bought the coin when it was worth less than a dollar but also for those who decide to start now.
How to Store Your Bitcoin
The best place to purchase Bitcoin from, regardless of whether you’re in Canada or abroad, is through online crypto exchanges.
If you haven’t done this before, you’ll need fiat-to-crypto exchange where you can deposit CAD or another fiat currency if you wish, and purchase your first bitcoins. Otherwise, feel free to use the services on any crypto-to-crypto exchange.
These platforms tend to be centralized, i.e. there are large companies and venture capital firms backing them up. This allows them to invest more in their features and provide spotless user experience for their customers. In Canada, the most reliable crypto exchanges are Bitbuy, Coinberry, and Newton.
So, you found an exchange that you like, registered for an account, and successfully bought your first BTC. But where does one store these coins?
What you need is, of course, a digital wallet. Now, the Internet abounds with options but the most popular one is the software wallet. You get a public wallet address that you insert on the exchange when buying cryptocurrencies. The exchange automatically transfers your coins to the address you’ve provided.
Software wallets are great for storing cryptos short-term because there’s still the risk of thefts and frauds online. An even better option would be to purchase a hardware wallet and keep the key to your wallet address in this USB-like device which remains disconnected from the Internet.
Alternative Ways of Buying Bitcoin
Despite the fact that centralized crypto exchanges remain the number one pick for traders around the world, it’s always best to familiarize yourself with the alternative ways of buying Bitcoin in Canada because it might turn out that they work better for your investment strategy.
Let’s take a look at our three alternative picks:
Peer to Peer Exchanges
The opposite of centralized exchanges, peer-to-peer crypto exchanges have no central authority in charge of users’ transactions. They were designed to allow traders to stay anonymous when completing their transactions and only require an email address to accept your account.
P2P exchanges take no custody of your funds. Instead, their website is open to buyers and sellers to find the best offer among themselves and agree on the trading terms and payment methods that work best for them. Most of the time, transfers happen through smart contracts.
The trick with these exchanges is to find the best offer as sellers add their own fees on top of current market prices.
Bitcoin ATMs, or BATMs, have recently gained traction as a convenient Bitcoin buying alternative. They’re usually located in shopping malls, retail stores, supermarkets, restaurants, and airports.
Imagine you’re traveling to a foreign country and desperately need to cash out some bitcoins but can’t connect to any WiFi in the area. Thanks to BATMs, you can withdraw BTC to your wallet address or even sell them at the current rate.
BATMs connect you to a crypto exchange that sells Bitcoins. They accept payments in cash or using credit/debit cards. However, convenience comes with a price, as these machines charge you with a 5 to 10% fee.
On Coin ATM Radar, a popular site to find Bitcoin ATMs, Canada is the second country by the number of BATMs (770!).
Amazon Gift Cards
The third alternative way of buying Bitcoin in Canada is using Amazon Gift Cards. You can purchase a $10, $25, $50, or a $100 card, or choose a custom amount between $25 and $500. Then, either you or the person you’re getting the card for can swap the card for BTC on platforms like Price or Paxful.