A more recent guide to buying bitcoin can be found here.

The Flying Frisby

How to buy bitcoin in the UK (and elsewhere)

Listen now (12 min) | The bitcoin price has been quietly moving up and, almost inevitably, I am getting messages from people asking how to buy it. Bitcoin should make up a core part of your investment portfolio. Never mind the noise, the doubts, the FUD (fear, uncertainty and doubt), the “but I don’t understand how it works”, bitcoin is an incredible computational breakthroug…

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a month ago · 2 likes · 2 comments · Dominic Frisby

Today we consider bitcoin - how, where and when to buy it.

I wrote the first (and many say the best - who am I to disagree?) book on bitcoin from a recognised publisher back in 2014. So I know a thing or two about it.

“A great account. Read and glimpse into the future,” said Richard Branson. Though it’s not clear he actually read it.

Bitcoin seems to go through four phases with every cycle.

1. There’s the Quiet Accumulation. Few outside of the bubble of ardent bitcoiners take notice, as it discreetly creeps up. 

2. The Frenzy and Blow-Off Top. The price rises accelerate. There is a rush to buy. The media is all over it. Everyone on social media is crowing. There’s a huge row about whether bitcoin is in a bubble or not. I get invited onto the BBC to talk about it. You get a phonecall from your mate’s nan asking how to buy it. Dean from up the flats starts holding court in the cafe about irresponsible monetary policy at the Federal Reserve. Bitcoin has one of its blow-off tops. See 2013, 2016 and 2021 for more details.

3. The Monster Correction. Bitcoin loses over 50% of its value. Economists who missed the boat go on telly and declare they were right, ignoring the fact that the price to which bitcoin corrected to is several hundred percent above where the quiet accumulation phase began. Earlier in bitcoin’s evolution these corrections could be 90% or more. Now they have “scaled back” to more like 60%.

4. The Frustrating Consolidation. Bitcoin goes into a period of range trading, consolidating the gains of the previous bull market. This is a period of relative quiet, at least by bitcoin standards. There are rallies that get many excited, but prove to be false dawns. Investors get frustrated by the grinding action. The media loses interest. Many forget about it, and so we gradually drift into another Quiet Accumulation phase.

We have just had classic-of-the-genre Monster Correction, during which bitcoin lost almost 80% of its value, going from around $68,000 back to just under $16,000.

Since December it’s been quielty rallying and today we sit around $21,000.

Bitcoin should make up a core part of your investment portfolio. Never mind the noise, the doubts, the FUD (fear, uncertainty and doubt), the “but I don’t understand how it works”, bitcoin is the money of the future. In fact, it’s the money of the present. It’s an incredible technological breakthrough with enormous implications for the world. Own a share of the pie - it is in limited supply.

It might go back and re-test $16,000. It could fall another 80%. Then again it could go up and up and up from here. Nobody knows. But the best time to accumulate is during the Frustrating Consolidation or the Quiet Accumulation, and we are in one of those two phases.

The best ways to buy bitcoin.

There are three ways to get hold of bitcoin: you can earn it, you can buy it or you can mine it. 

Forget mining for now. Bitcoin mining is beyond the scope of this article.

Earning is simple. All you need is a wallet. As long as the buyer of whatever product or service you are selling is happy to pay you in bitcoin, you just send them your wallet address on your invoice, instead of your bank details, and they can pay you in bitcoin, just as they would any other form of money.

There are countless wallet providers. I like Exodus, because it works on both your phone and your desktop, and Muun, because the interchange between bitcoin and the lightning network is very user-friendly.

Follow the instructions they give you to get started. They have videos to help you. Keep a note of your seed phrase and store it somewhere safe. Put aside an hour to have a play, and familiarise yourself with how it works.

So that’s how to earn bitcoin. What about buying it?

To buy bitcoin, you need to go through an exchange - the equivalent of a broker or bureau de change.

So which are the best exchanges?

There are so many exchanges now, and they all have their pros, cons and idiosyncrasies. The best for UK investors are probably any of Coincorner, Gemini, Kraken, Binance, Bitfinex, CEX.Io, Bitstamp, Poloniex, Bittrex and eToro.

The one I use the most is Coin Corner. I have an affiliate deal with them.