What are the ways to buy crypto by bypassing an exchange and store them? Enthusiasm and fascination for crypto, especially Bitcoin, is growing with each passing day so much that it has almost become a craze now.
And it is not hard to deduce the reasons behind it.
Due to the pandemic panic, the US Federal Reserve and central banks started printing trillions of new dollars which resulted in the corruption of currency on an industrial scale.
This released elemental forces that are hard to ignore, and there are lots of incidents of it. As a result people started looking for an alternative investment asset.
Bitcoin, and other crypto coins that followed its launch, offered people that chance and it immediately created a storm in the financial market.
However, investing or buying cryptocurrencies has not always been easy for an average crypto investor.
Due to the imposed regulations not long ago, it became quite difficult and tedious to open a crypto account at any crypto exchange or a crypto broker.
The process was frustrating and took as long as five to six weeks to complete.
Fortunately, things have improved a long since then and now the crypto exchanges have become a lot less intimidating.
What more, you may not even need their services at all sometimes while buying or selling crypto coins.
This is one specific aspect that is causing disasters to the crypto exchanges which is fueled by the notion of Bitcoin that is supposed to be a value of exchange or a decentralized currency.
This makes storing crypto coins on a centralized exchange quite ironic.
However, if you still want to trade crypto profitably by bypassing an exchange, this article will tell you all about how to do it.
Ways to Buy Crypto by Bypassing an Exchange and Store Them
There are some easy ways to buy crypto or Bitcoin bypassing a broker exchange or without needing to deposit or withdraw your crypto assets.
There is nothing to be surprised about because the working process is pretty simple and similar to using a crypto exchange account.
Ideally, while dealing with crypto and to be safe, there are two specific steps in general to follow.
- Getting yourself a proper software or hardware crypto wallet to hold your private keys and
- Choosing a reliable platform, which in this case is the one that allows buying crypto without depositing your coins.
However, no matter what, you should be very careful during the entire process so that you do not end up losing your coins and having no recourse.
Typically, these specific crypto platforms follow a very simple process which involves giving your public key to the exchange for it to use to send the coins that you bought to your digital wallet.
However, at this point you should keep one thing in mind – no matter whichever method you choose, make sure that you buy some Bitcoin.
Moving a part of your savings to Bitcoin is a good move because, at the rate things are turning out, it may not be long when paper money will go to zero.
If you do not move your savings to Bitcoin right now, you may wake up one fine morning only to find that the greenbacks you hold in your bag are no longer worth the paper these currencies are printed on.
However, also keep in mind that this is still quite a risky asset class and therefore you should not go all out and invest your last dime on it.
And, do not expect to get rich overnight or any instantaneous gratification. It will take some time.
With all that said, here are the ways to go ahead with crypto bypassing an exchange and storing them safely.
Start with selecting some of the most reliable and secure platforms to buy crypto without trusting an exchange.
To make things easier for you, here are a few secure places that you may choose.
- Coinmama– This is one of the most reliable and oldest platforms that you can use from anywhere in the world
- Changelly– This is a crypto exchange that will allow you to buy and sell crypto coins instantly and have total control
- Swapzone– This is a place where you can buy or swap crypto from anywhere in the world and pay lowest fees for it and
- PayBis– This is a modern crypto exchange that is specially designed to allow the transfer of funds very quickly by using your credit card or debit card.
However, remember, this is not an exhaustive list.
Therefore, do research well to find one that is most suitable for your crypto trading needs.
Through a Do-It-All Digital Wallet
If you are apprehensive of the above method, you can also choose a do-it-all digital wallet.
A digital wallet typically is an encrypted location to store your crypto coins.
However, a do-it-all wallet will not only store Bitcoin and a lot of other crypto coins but will also allow you to purchase the Bitcoin you want to put in it. Usually, you will need to use a charge-card for that.
Apart from that, you can also swap your Bitcoin for any other types of coins that the wallet supports, if you are itching to trade.
You can do this at the current market prices, and all inside the wallet itself.
A few specific types of do-it-all wallets that you can choose to use are as follows.
Atomic Wallet – Suitable for All Types of Crypto Users
This is a multi-currency software wallet and is quite a popular desktop/laptop wallet.
It supports Bitcoin and several hundreds of other types of crypto coins and comes with a built-in exchange that allows you to buy and sell crypto coins.
However, this will come at a cost because this feature uses the service of a third party, Changelly.
The additional fee charged is 2% at a bare minimum of $10 each.
This wallet is suitable for all types of crypto users and provides a simple and convenient way to store the crypto assets.
This decentralized online crypto wallet is quite safe and secure to use because it is you, and only you, who will have total control of the entire proceedings and hold the private keys to access it.
However, when you purchase Bitcoin by using your VISA or MasterCard, you may be charged a fee of about 5% for every transaction and also trade them for other coins at the prevailing market prices.
If you are using an Android or an Apple smartphone, you may use the Atomic app.
This will sync with the desktop installation. By using this app you can also trade crypto coins or check prices.
You simply need to have an internet connection to use this app from anywhere.
Exodus – Good for Beginners
This is another good laptop/desktop digital wallet to use for sending, receiving, exchanging, and storing Bitcoin and more than 180 other types of crypto coins.
It is pretty much similar to the Atomic wallet in features and functionality allowing you to have sole possession and control of the private keys and trade with the supported crypto coins inside the wallet.
The wallet offers advanced and strong security since all your crypto assets will be stored safely offline on Trezor hardware.
It also comes with an app to use in Android and iOS smartphones that will sync with your desktop installation.
You can monitor the movements in the market on the go and exchange crypto coins with just a couple of taps.
By using this wallet, you can buy crypto coins with currencies of your choice such as with USD, GBP, and EUR and pay 0% fees for that.
You can make payments by using different options according to your convenience which include credit cards, debit cards, or bank transfer for 0% fees on Bitcoin and other select coins for a limited period.
In addition to that, another useful feature of this wallet is that it allows you to use the Apple Pay option to purchase Bitcoin.
Offering professional-level control over your wealth and crypto coins, this is one beautiful app that allows earning easy interest.
This is a good wallet to use for beginners especially since it offers live charts, portfolios and 24/7 human support.
However, the service available for this specific do-it-all wallet is available in only 43 US states as of now.
Approval for services in Connecticut, New Hampshire, New York, Hawaii, North Carolina, Virginia, and Vermont are awaited.
Ledger Nano – Bluetooth Connectivity
This offline crypto hardware wallet allows buying new crypto coins through its built-in app without needing you to move your assets.
It is done through a third party exchange, Coinify, and comes at a cost of 4.5% when you use your credit card or 1.7% for using bank transfers.
You will have full control of your crypto assets when you use this USB storage wallet that comes with Bluetooth connectivity.
And, since it is offline, it is considered to be one of the most secure wallets.
In addition to that, the wallet will allow you to perform different types of functions such as sending and receiving Bitcoin from blockchain networks, running third-party apps, and more on the device, apart from storing your asset safely.
Trust Wallet – Popular and Easy to Use
This is another good multi-currency, multi-functional, decentralized software wallet that allows safe storage of your crypto assets.
This also uses a built-in exchange to allow you to buy crypto coins instantly by using your credit card by paying an additional fee of 5% for every complete transaction.
You can download this app for your desktop computer or for mobile devices.
Both are easy to use across different blockchain networks.
It can hold more than thousand tokens which is one significant factor for its popularity among users.
Apart from storing your coins, Trust Wallet also allows staking them.
If you do not want to buy crypto coins by any of the methods mentioned above, you can visit one of the numerous Bitcoin ATMs that have been growing like mushrooms.
You will find one in almost every nook and corner, and even in a bar!
However, if you cannot find one in your locality, you may download and use a free app such as the CoinATMRadar or CoinFlip in your smartphone to find one nearest to you.
The Bitcoin ATMs function just like any traditional ATMs of a bank with the only difference that these machines do not move dollars in or out of it.
Instead, the Bitcoin ATMs redeem Bitcoin in your crypto wallet for dollars.
Depending on the features of the machine, you may even convert the dollars you insert into it into Bitcoin in your digital wallet.
The good thing about these ATM machines is that they support any type of Bitcoin wallet, though it is suggested that you use the mobile versions of Exodus and Atomic wallets for that matter if you want added convenience.
This is because both of these allow you to convert the wallet address displayed in a long string of characters that may look like garbage into a bar code on the screen of your smartphone.
This means that you will not have to type the long character string.
All you have to do to communicate the address of your wallet to the Bitcoin ATM is hold the device in front of the scanning window and you are done.
Well, all these conveniences offered by the Bitcoin ATMs come at a cost which may vary depending on the location and the type of the machine.
Usually, the fees charged for converting your crypto coins to cash via a Bitcoin ATM is about 4% to 5%.
However, if you do the opposite, that is feed paper dollars to the machine to convert them into Bitcoin in your digital wallet, the fee for it could be between 7% and 8%.
Through an Ordinary Stockbroker
You can also buy Bitcoin, or any other crypto coin for that matter, by using a regular stockbroker that allows doing so.
For example, a closed-end publicly listed fund GBTC or the Grayscale Bitcoin Trust holds Bitcoin.
Anyone can buy or sell coins without any limitations through their regular stockbroker.
The good thing about it is that the price actions follow Bitcoin very closely.
This means that GBTC is almost the same as investing in Bitcoin itself.
This is a very good option for newcomers to the crypto world who want to spend as little time as possible to get familiarized with this peculiar new investment asset class.
However, the most significant drawback of this approach is that the shares may be traded consistently at a price that is more often than not 20% to 35% above the actual worth of the underlying Bitcoin.
Therefore, as you can see that there are several ways in which you can buy Bitcoin and other crypto coins by bypassing an exchange.
Now the question is how you are going to store them.
Well, there are a couple of ways to store your coins. One, you can leave them where you have bought the coins from.
For example, you can hold the coins you bought through Cash App as long as you want in the Cash App account.
On the other hand, you can also store the Bitcoin or other crypto coins in your own digital wallet.
However, both these come with significant security risks as you will see in the detailed discussion that follows.
Reading it will help you to determine whether or not you actually need to have a separate crypto wallet at all.
If you want to leave the Bitcoin at the exchange or brokerage you bought it from, it will usually be a very safe option.
However, you will need to consider the security protocols of each because it may vary from one platform to another.
Typically, there are three types of security that most major crypto exchanges use to ensure the safety of the crypto assets of their users.
- Cold storage – Most exchanges store the major part of Bitcoin in their customers’ accounts in cold wallets. This means that the storage is not connected to the internet and therefore the coins are free from the risks of being hacked.
- Hot wallets – A small part of the coins may also be stored in the hot wallets, or the ones that are connected to the internet. This ensures proper and adequate liquidity when a customer wants to buy, sell, or transfer their digital assets. Reliable exchanges usually have adequate insurance coverage for the same to protect the funds of their customers in case there is any unlikely event where the coins may be stolen.
- Custodial accounts – A few exchanges also hold the funds of their clients in custodial accounts that are usually at any FDIC-insured bank. This protects the cash balances in the accounts.
However, none of these methods of storing your crypto coins is free from the risks of being hacked or someone transferring the funds without authorization, if you do not keep your password safe.
It is also recommended that when you store your crypto coins at an exchange you should safeguard other authentication measures as well.
Remember, if someone is able to transfer your coins out of your account, it is gone, forever.
You can use your own wallet to store your crypto coins, Bitcoin or any other.
This will ensure that no third party has the custody of your keys and funds.
Typically, using your own wallet will give you total control over your funds as well as the security keys or private codes that will prove your ownership of the coins.
While selecting a wallet to store your crypto wallet, you should research well and make sure that you choose one that will meet all your needs.
Ideally, you can choose from the following three variants.
- Software wallet – This refers to a wallet that is on your computer just like any other software installed in it. When you store your coins in a software wallet, you surely do own your coins but these coins are still susceptible to hacking when you connect your computer to the internet.
- Hardware wallet – This refers to a separate physical device, which often looks like a USB flash drive, where you can store your coins. Since these are portable, it is easy to carry and also eliminates the risks of being hacked virtually.
- Paper wallet – This refers to the traditional paper form. Though it is a good option, it comes with the risks of being lost or damaged due to fire or water.
Ideally, if you have a small amount of crypto coins in your possession then it is good to leave them at the exchange.
The crypto wallets are quite expensive and may not be worth spending for an insignificant number of coins.
However, make sure that you take proper measures to protect the password and authentication methods.
Also, be sure about the safety and security measures of the exchange itself.
On the other hand, if you have a large amount of crypto in your possession, it is always better to invest in a crypto wallet to store your Bitcoin and other coins as safely and securely as possible.
Remember, it is always good to be very meticulous and organized when you deal with crypto right from the very beginning till the end of making a transaction.
This is important because there is no central authority to fall back on looking for recourse should any untoward incident happen in which you lose all your coins.
So, these are some of the best ways to buy Bitcoin and other crypto coins. You will not have to trust a centralized exchange or be a trader for it.
Now that you know about the ways, it is entirely up to you to decide which way you want to go and have full control of your crypto.