How to Buy Bitcoin UK: A Beginner’s Guide

Find out the best methods for buying bitcoin in the UK as well as the top platforms to do so.
Kane Pepi
Author: Kane Pepi
Last Updated: 22 July 2020

There are number of online platforms and methods to buy Bitcoin in the UK and figuring out where to get started can be daunting. In this beginner’s guide, we explain the ins and outs of how you can buy Bitcoin in the UK, as well as the best platforms for doing so. We also explain some the factors that you need to look out for prior to parting with your money – such as regulation, fees, spreads, and withdrawals.

Our recommended UK Platform

Don’t have time to read through our guide and simply want to buy Bitcoin right now?

If so, we would suggest the broker listed below. Our top-rated platform is regulated by the UK’s FCA, so your funds are safe at all times. You can also deposit funds with heaps of everyday payment methods, and you won’t pay any fees other than the spread.

eToro: Best UK Platform for 2020

our rating

  • Buy physical bitcoins or trade Bitcoin CFDs
  • Copy trading available
  • CySEC, FCA and ASIC regulated
75% of retail investors lose money when trading CFDs with this provider. Crypto assets are highly volatile unregulated investment products. No EU investor protection.

Bitcoin in the UK

Consumer demand in the UK for Bitcoin took off in late 2017 when the cryptocurrency went on a parabolic run to $20,000. This amounts to an all-time high of around £16,000. To put this into perspective, Bitcoin was worth less than 1p back in 2009. Those that were fortunate enough to jump on the band-waggon early are now looking at unprecedented profits.

In terms of availability, the UK is home to a number of popular cryptocurrency brokers. Moreover, a number of regulated CFD brokers now offer markets on Bitcoin – including heavyweight firms like Plus500, eToro, CMC Markets, IG, and even City Index. Some brokers even offer a dedicated Bitcoin market against the pound sterling.

This is unusual, as the vast majority of the industry is marked-up against the US dollar. Outside of the traditional brokerage space, there are also a number of Bitcoin ATMs scattered around the UK. This allows you to insert cash into the machine, and in return, Bitcoin will be transferred to your digital wallet.

What is the Best Way to Buy Bitcoin in the UK?

There are heaps of way to invest in Bitcoin – such as a Bitcoin ATM or peer-to-peer exchange. With that said, the easiest way to get your hands on cryptocurrencies as a first-time buyer is to use an online broker.

The process works largely the same regardless of which platform you sign up with. You’ll need to open an account, deposit some funds, and then specify how much you wish to buy. After that, most brokers allow you to withdraw your newly purchased Bitcoin out to a private wallet.

This operates much like a bank account, albeit, you retain full control over your private keys. When it comes to payments, most UK brokers allow you to fund your account with an everyday payment method. This includes the likes of a debit card, credit card, or an e-wallet such as Paypal or Skrill.

You can also deposit funds via a local UK bank transfer. Finally – and perhaps most importantly, UK brokers must hold a regulatory license. As noted above, this will usually be with the UK’s FCA. As such, client funds will be held in segregated bank accounts. This means that were the broker to collapse, your funds should be protected.

Where to Buy Bitcoin in the UK

1. eToro - Best Bitcoin Social Trading Platform in the UK

Visit etoro

  • Offers to buy bitcoin directly via exchange or via CFDs
  • Offers a wide selection of digital assets
  • eToro provides the CopyTrade feature that allows you to copy trades of other investors
  • eToro charges an inactivity fee
  • High BTC/USD spread
75% of retail investors lose money when trading CFDs with this provider. Cryptoassets are highly volatile unregulated investment products. No EU investor protection.

2. Changelly - A Simple to Use Platform for Buying Bitcoin

Changelly is a popular cryptocurrency exchange providing investors to buy bitcoin and other 140 cryptocurrencies instantly without having to deal with a complicated trading platform and market execution. Changelly simply offers an easy to use exchange platform with a 0.25% cryptocurrency trading fee that is below the industry average. Further, the verification process is straightforward as this exchange requires a digital wallet and email address to make a bitcoin purchase.

Founded in 2015, Changelly has gained more than 2 million users worldwide, and the exchange processes about 15k transactions per day. But what makes Changelly different than most crypto exchanges in the market is the fact that it supports both crypto-to-crypto and fiat-to-crypto exchanges. However, unlike eToro that offers an instant execution, transactions at Changelly are processed and converted within 5-30 minutes

The bottom line; Changelly is an ideal crypto exchange for investors who want to make a simple to use anonymously bitcoin purchase. It is also among the best exchange for crypto-to-crypto conversions.

Assets: 140+ cryptocurrencies

Demo Account: No

Educational Material: Blog. Free cryptocurrency crash course

Fees: A flat fee of 0.25% per trade, 0.0001 Withdrawal Fee, deposit fees vary depending on the amount of the deposit

Minimum deposit: No minimum deposit

Special Features: Supports crypto-to-crypto and fiat-to-crypto exchanges, more than 140 cryptocurrencies, simple verification process, provide API white label solutions.

Regulation: No regulation

Payment methods: Credit/debit card, any cryptocurrency

  • Changelly supports crypto-to-crypto and fiat-to-crypto conversions
  • An extensive range of more than 140 cryptocurrencies
  • Low fees
  • Not suitable for professional investors
  • Does not offer CFD trading

3. Coinmama - A Safe and Secure Platform to Buy Bitcoin in the UK

  • Available in 188 countries
  • A safe and secure platform
  • Instant execution
  • High trading and processing fees
  • Low selection of crypto coins

4. Binance - Pure Cryptocurrency Exchange

Binance was founded in July 2017 and is one the few pure cryptocurrency exchanges in the market. Unlike Changelly and Coinmama, Binance offers a huge selection of cryptocurrency pairs through a web-based/desktop/mobile advanced trading platform that is quite similar to platforms of other markets such as the forex and stock market.

Binance is available in over 130 countries, including the United Kingdom. This platform claims to have the highest daily trading volume of all crypto exchanges, which makes an ideal crypto trading platform for day/swing traders and arbitrage traders. Users on Binance have the opportunity to choose the most suitable way for them to buy and trade bitcoin: Basic, Classic, Advanced, OTC, and P2P. Additionally, Binance allows users to trade futures with a leverage ratio of up to 125:1.

Further, trading fees at Binance's platform are way below the industry average which is around 0.25%. The only downside of Binance is the complexity of the interface. The interface is quite difficult to understand and requires some time before you get familiar with the platform.

Assets: 150 crypto coins

Demo Account: No

Educational Material: Binance lacks educational material

Fees: A flat trading fee of 0.10%, 0.0004 Withdrawal Fee

Minimum deposit: No minimum deposit

Special Features: Futures trading, leveraged tokens, crypto finance solution, advanced trading platform, and mobile app.

Regulation: Not regulated

Payment methods: Cryptocurrencies, Credit card, and wire transfer.

  • A pure cryptocurrency exchange
  • Offers a great mobile app
  • More than 150 cryptocurrencies are available on the platform
  • Complicated trading platform
  • Not suitable for newbies

5. Coinbase - A Regulated Bitcoin Exchange with Digital Wallet

Founded in 2012, Coinbase is one of the largest cryptocurrency exchanges in the world, with more than 30 million users worldwide across over 100 countries. The US-Base cryptocurrency exchange offers a variety of products and services that include bitcoin and cryptos brokerage service, cryptocurrency storage, cryptocurrency custody for institutions, and a platform for startups to raise capital.

Some of the most interesting features of Coinbase include its own digital wallet, the Pro advanced trading platform, and the fact that Coinbase supports PayPal as a payment method. Further, Coinbase its own stable coin, the USD Coin (USDC). The USDC is a cryptocurrency pegged to the US dollar and allows Coinbase's users to earn rewards (fixed interest rate) for every USD Coin they hold.

Coinbase is an ideal exchange for beginners but also for professionals who are looking for a professional exchange platform, much like Binance. Unlike most crypto exchanges, Coinbase provides 'all in one' platform for anyone who wants to buy, sell, and store cryptocurrencies.

Assets: 50 cryptocurrencies

Demo Account: No

Educational Material: A comprehensive education center that includes crypto guides and a blog.

Fees: Spread margin of 2% for digital currency conversions, different fixed trading fees that range between 1.49%-2%, 4% credit card deposit fee, no withdrawal fee

Minimum deposit: Per transaction

Special Features: Offers the Coinbase digital wallet, Pro advanced trading platform,

Regulation: FinCEN. Coinbase complies with The Bank Secrecy Act and The USA Patriot Act.

Payment methods: Bank account (ACH), debit card, wire trnasfer, and PayPal.

  • Offers users to store cryptos on its own digital wallet
  • Supports PayPal as a payment method
  • Offers professional investors access to the Coinbase Pro trading platform
  • A complicated fee structure
  • Does not offer CFDs

How to Buy Bitcoin in the UK: Step-by-Step Tutorial

Looking to buy Bitcoin today from a UK broker? If so, we would suggest reading our Layman’s step-by-step guide. The steps below are based on our top UK broker pick – eToro. With that said, the guidelines remain constant regardless of which broker you decide to sign up with.

Step 1: Open an Account

Firstly, you will need to complete some personal information to open your Bitcoin account.  In order to remain compliant with the FCA – the broker will ask you to enter some questions about your identity.

This includes:

  • First and Last Name
  • Home Address
  • Date of Birth
  • National Insurance Number
  • Contact Details

You will also need to answer some questions about your prior trading experience. This is to ensure that you understand the risks of investing in assets like Bitcoin.

Step 2: KYC & Verification

You will also need to have your identity verified before you can proceed. The good news is that eToro is able to do this automatically.

As such, upload a clear copy of your government-issued ID (passport or driver’s license), and the system should give you the all-clear straight away.

Step 3: Deposit Funds

One of the overarching selling points of using a Bitcoin broker like eToro is that you will have heaps of payment methods to choose from.

This includes:

  • Debit Card
  • Credit Card
  • Local Bank Transfer
  • Skrill
  • Paypal
  • Neteller

Unless you are opting for the bank transfer option, your deposit should be processed instantly. Take note, although there are no transaction fees to contend with, you will need to meet a $200 (GBP-equivalent) minimum deposit requirement.

Step 4: Go to Bitcoin Trading Page

Once you have set your eToro account up, you are then ready tobuy Bitcoin To get the ball rolling, enter ‘Bitcoin’ into the search box at the top of the page and click on the corresponding result. You will then need to click on the ‘Trade’ button.

Step 5: Buy Bitcoin

You will now be presented with an order box. You will need to fill this out correctly to buy Bitcoin, so do tread with caution.

With that said, the order box might appear complex if you’ve never traded before, be sure to review the following points.

  • Buy/Sell: If you want to invest in Bitcoin because you think it will increase in value, make sure the order box is set to a ‘buy’ order. If you want to speculate on the price of Bitcoin going down, opt for a ‘sell’ order.
  • Market/Limit Order: If you want to take the next available price, leave the order box as a ‘market’ order. If you want to choose the price that the trade is executed, opt for a ‘limit’ price.
  • Leverage: If you apply leverage, this means that you can purchase more Bitcoin than you have in your account. However, this means that you will be investing in a CFD, so you won’t own the Bitcoin outright. Leave this blank if you want to retain 100% ownership.
  • Stop-Loss: If you want to mitigate your risks, enter your stop-loss order price.
  • Take-Profit: If you want to lock in your profits, specify the price that you want your trade closed at.

Finally, click on ‘Buy’ to complete your Bitcoin purchase.

What to Look for in a UK Bitcoin Broker

It’s always wise to do a bit of research yourself before joining a new Bitcoin broker. After all, no-two trading platforms are the same. For example, while some are super-competitive in the fees and commission department, others excel by offering a BTC/GBP marketplace.

Either way, be sure to assess the following factors before joining a UK Bitcoin broker.

  • Licensing

If you’re based in the UK and you wish to buy Bitcoin with a credit card or any other everyday payment method, the broker must be regulated by the FCA. Among a number of other safeguards, this ensures that your funds are kept separately from that of the broker’s working capital. Platforms like eToro go one step further by holding licenses with other jurisdictions too – such as Australia (ASIC) and Cyprus (CySEC).

  • Supported Cryptocurrencies

If the UK broker supports cryptocurrencies, then you can be all-but-certain that Bitcoin is listed. With that said, there might come a time when you want to invest in an alternative digital currency – such as Ethereum or Ripple. As such, check to see what cryptocurrencies the broker supports before signing up.   

  • Payment Methods

You also need to check what payment methods the broker supports. Platforms like eToro offer a full suite of options. This includes a debit or credit card, an e-wallet like Paypal, and a local bank transfer. Also, be sure to check what minimum deposits and withdrawals apply.

  • Trading Fees and Commissions

You will need to pay the broker a fee to buy Bitcoin. The specific fee structure will vary depending on your broker of choice. For example, eToro does not charge any commissions to buy Bitcoin, but you will need to take the spread into account. Other brokers will charge you a variable fee, which is calculated against the size of your purchase.

  • Leverage and Short-Selling

If you want to utilize more sophisticated trading tools – such as leverage or short-selling, you will need to use a broker that supports CFDs. Don’t forget, you’ll be capped to limits of 2:1 when applying leverage on Bitcoin.

  • Customer Support

It’s also worth checking to see what customer support channels the UK broker offers. The most convenient option is live chat, although some brokers also offer a telephone support line. If they do, it’s notable if a UK toll number is provided. Further, check what hours the customer service team operates.

Other Ways to Buy Bitcoin in the UK

Although using an online broker is the easiest, safest, and cheapest way to buy Bitcoin in the UK, other options do exist.

This includes:

Bitcoin ATMs

Bitcoin Depot Claims to Add 500 Bitcoin ATMs on Its Network

If you’re looking to buy Bitcoin with cold-hard cash, it might be worth considering a Bitcoin ATM. There are now over 300 machines dotted around the UK, with more being installed on a frequent basis.

  1. Once you have located an ATM, you will then need to specify how much Bitcoin you wish to buy in pounds and pence. The machine will then let you know how much Bitcoin you will get in return – including fees.
  2. If you’re happy with the figures, you will then be instructed to insert the required amount into the ATM. Once you do, the machine will print a receipt. This contains a unique Bitcoin wallet address, which is where your newly purchased coins are stored.
  3. Alternatively, you can have the coins transferred straight to your private wallet.

Take note, buying Bitcoin from an ATM can cost as much as 10% in fees, so do bear this in mind.

Peer-to-Peer Websites

An alternative option that you might wish to consider is that of a peer-to-peer (P2P) website like LocalBitcoins. In a nutshell, the platform allows you to buy and sell Bitcoin directly with the other party.

  1. For example, let’s say that you want to purchase £500 worth of Bitcoin. You will be presented with a list of sellers based in the UK, alongside the payment methods that they are happy to support. The most popular method is that of a local bank transfer.
  2. Once you agree on terms, the seller will deposit the Bitcoin into the escrow wallet of the P2P site. You will then be instructed to transfer the agreed amount. If it’s a bank transfer, proceed to transfer the funds.
  3. Once the funds have been sent, you need to notify the seller. They will then check that the payment has been received, and release the Bitcoin from the escrow wallet.
  4. You will then need to withdraw your newly purchased Bitcoin to your private wallet.

Conclusion

In summary, the Bitcoin phenomenon is getting more and more widespread in the UK. Not only are there hundreds of online brokers that allow you to buy cryptocurrencies at the click of a button, but there are also a number of physical Bitcoin ATMs, too.

With that said, the safest, and the most cost-effective way of buying Bitcoin in the UK is to use a regulated broker like eToro. The platform is licensed by the FCA, and it allows you to buy and sell Bitcoin without paying any commission. You are also offered the option of going short, and you can apply leverage of up to 2:1.

eToro: Best UK Platform for 2020

our rating

  • Buy physical bitcoins or trade Bitcoin CFDs
  • Copy trading available
  • CySEC, FCA and ASIC regulated
75% of retail investors lose money when trading CFDs with this provider. Crypto assets are highly volatile unregulated investment products. No EU investor protection.

FAQs

Is Bitcoin legal in the UK?

Yes, Bitcoin is perfectly legal in the UK. With that being said, the UK government is yet to install a dedicated legislative framework to cover cryptocurrencies. In fact, there is still an ongoing debate between policymakers as to whether Bitcoin should be classed as a currency or a commodity.For example, HMRC views Bitcoin as property, so naturally, capital gains are liable if you sell your holdings for more than you paid. In terms of regulation, there is no single authority that is responsible for governing Bitcoin transactions. However, if you're using a traditional broker to invest in Bitcoin, the platform will need to be regulated by the Financial Conduct Authority (FCA). As such, you are best advised to stick with FCA-regulated Bitcoin brokers, as your money will remain safe at all times. Unfortunately, a number of UK-based cryptocurrency exchanges still operate without a license - so you should avoid these at all costs.

What payment methods do UK Bitcoin brokers support?

If you're using a regulated broker that accepts fiat currency, then you will likely to get to choose from a debit/credit card, e-wallet, or local bank transfer.

Can I buy Bitcoin anonymously in the UK?

Licensed brokers in the UK are required to identify users before allowing them to buy Bitcoin. The only way around this is to use a Bitcoin ATM or a peer-to-peer site.

What is the minimum amount I have to invest to buy Bitcoin?

This depends on the broker you sign up with. Nevertheless, minimum deposits average £50-£200 in the UK.

Can I buy Bitcoin with leverage in the UK?

If you're based in the UK and you wish to apply leverage, cryptocurrency trades are capped at 2:1. You can only get a higher limit if you are a non-retail trader.

Kane Pepi

Kane holds academic qualifications in the finance and financial investigation fields. With a passion for all-things finance, he currently writes for a number of publications in the online space.

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eToro: Buy and Sell Bitcoin with 0% Commission

eToro: Buy and Sell Bitcoin with 0% Commission

eToro: Buy and Sell Bitcoin with 0% Commission

Visit eToro

75% of retail investors lose money when trading CFDs with eToro.

eToro: Buy and Sell Bitcoin with 0% Commission
Visit eToro

75% of retail investors lose money when trading CFDs with eToro.

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