Bitcoin is an excellent asset to incorporate into your portfolio to avoid inflation, especially if you are living in the United Kingdom. However, the UK does not have any regulatory framework for cryptocurrencies. The nation has confirmed that crypto assets are property but has no specific cryptocurrency laws. Also, the country does not recognize Bitcoin and altcoins as legal tender.
This guide will cover everything you need to know about how to buy Bitcoin in the United Kingdom. We’ll discuss the best cryptocurrency platforms to buy Bitcoin, in the UK tax laws in regarding Bitcoin profits, and how to store coins safely after you buy Bitcoin in the UK.
Best Brokers To Buy Bitcoin In The UK in 2023
There are several cryptocurrency platforms that you can use in the United Kingdom to buy Bitcoin. These cryptocurrency platforms provide great coin selections, staking opportunities, and multiple trading pairs for Bitcoin.
Trading and buying Bitcoin are two very different things. Yes, both involve a Bitcoin UK purchase but the ongoing treatment of the investment is what makes trading and buying Bitcoin UK unique from each other. We’ve analyzed the best brands to buy Bitcoin and placed them in the table below.
|Partner Name Label||Label||CTA||Disclaimer|
|1. eToro||4.8||Visit Websiteetoro.com||This ad promotes virtual cryptocurrency investing within the EU (by eToro Europe Ltd. and eToro UK Ltd.) & USA (by eToro USA LLC) which is highly volatile, unregulated in most EU countries, does not fall under EU protections & is not supervised by the EU regulatory framework. Investments are subject to market risks, including the loss of principal.|
|2. Pepperstone||4.5||Visit Websitepepperstone.com||Spread bets and CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 80.9% of retail investor accounts lose money when trading spread bets and CFDs with this provider. You should consider whether you understand how spread bets and CFDs work, and whether you can afford to take the high risk of losing your money.|
|3. Eightcap||4.4||Visit Websiteeightcap.com||CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 79.04% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money.|
|4. Coinbase||4.2||Visit Websitecoinbase.com|
|5. Changelly||3.7||Visit WebsiteChangelly.com|
|6. Trading 212||4.0||Visit Websitetrading212.com||CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 83% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money.|
Key Takeaways for Buying Bitcoin In The UK
UK residents can use various tax break programs to limit the amount they will pay in capital gain tax.
The top method to store coins in the UK is with a cold wallet since they provide better security than cryptocurrency exchanges. The best hardware wallets are Ledger Nano X and Trezor One.
The top platforms to buy Bitcoin UK are eToro, Coinbase, Crypto.com, and Coinbase.
The UK Treasury has announced that they are in the process of making stablecoins a form of accepted digital currency.
UK investors can purchase Bitcoin anonymously by using a decentralized crypto exchange or a centralized crypto exchange that does not require a KYC process.
What Options Do I Have When Buying Bitcoin In The UK
UK residents have access to multiple types of platforms to buy Bitcoin. Let’s examine each option in greater detail.
Brokers: Bitcoin brokers allow investors to speculate on the price of Bitcoin while not conveying ownership. Instead, these platforms offer derivative products like CFDs, futures, and ETFs. The top Crypto brokers are eToro and Interactive Brokers.
Centralized Exchanges: CEXs like Crypto.com and KuCoin are perfect for those that require ownership of their cryptocurrencies since they allow investors to withdraw coins to a private Bitcoin wallet. Moreover, decentralized exchanges provide multiple services like staking, various trading tools, and informational resources.
Decentralized Exchanges: DEXs are not regulated by government authorities and require no ID verification, making them excellent for purchasing Bitcoin anonymously. The top decentralized exchanges are Uniswap, SushiSwap, and 1inch Network.
P2P Marketplaces: Peer-to-peer platforms connect buyers and sellers to participate in real-world trading activities. They facilitate the time and location of where the transactions will take place and apply a fee for their services. They are a good option when for example you want to sell Bitcoin or sell cryptocurrency.
Global Exchanges: These platforms operate globally and provide services in multiple jurisdictions. The biggest global exchanges that operate in the UK are Coinbase and Binance.
In fact, all the platforms above will let you buy top cryptocurrencies in the UK. If you want to know more about buying other tokens in the UK, check out these guides:
How To Buy Bitcoin In The UK?
Cryptocurrency exchanges have similar processes to buy Bitcoin UK. Below are step-by-step instructions that you can use as a guideline if it’s your first time buying Bitcoin:
Step 1: Pick a Cryptocurrency Exchange or Broker
Step 2: Begin the Sign Up Process
Step 3: Now, Verify Your Identity
Step 4: Next, Deposit Money Into the Account
Step 5: Navigate to the Trading Platform
Step 6: Finally, Write the Amount of Fiat Currency
Where To Buy Bitcoin In The UK?
British investors have access to dozens of platforms that offer investment opportunities in Bitcoin. Let’s analyze the top options and dive into why they are great for beginners.
Cryptocurrency Exchanges To Buy Bitcoin In The UK
Crypto.com is a cryptocurrency exchange that supports staking, wallets, NFTs, coin trading, and more. The platform has gained huge popularity thanks to its expert marketing team with advertisements in the UFC and NBA. It aims to be a beginner-friendly exchange that makes you buy Bitcoin online or other cryptocurrencies straightforward.
Furthermore, they have a learning section that teaches new investors the basics of trading and storing coins. In addition, Crypto.com has Visa cards that allow you to use cryptocurrency as a form of payment. Also, it provides amazing cashback rewards for everyday purchases.
Crypto.com is the fastest growing exchange with over 10 million active users.
Crypto.com provides multiple trading interfaces for various investment activities.
The platform has long-term sponsorships with the UFC and NBA.
Pros and cons of Crypto.com
Coinbase is known as the most beginner-friendly cryptocurrency exchange due to its educational resources. This section teaches new investors the basics of trading, the risks of cryptocurrencies, and in-depth tips. Also, you can learn about new developments in the crypto market and potential coins you can invest in.
To buy and sell Bitcoin through the online platform, you must verify the details provided when registering. You can register with this crypto platform in less than 10-15 minutes and choose between a debit/credit card or bank transfer to pay for your Bitcoin purchase.
Coinbase features a user-friendly interface that makes it convenient to navigate its platform. All features are easy to find, and the buying process of Bitcoin UK is simple for beginners. Also, Coinbase has an instant buy section, allowing investors to use their credit or debit card to quickly purchase BTC without using the trading platform. Also, Coinbase has recently updated its fee structure, resulting in lower costs when buying coins.
Furthermore, the established cryptocurrency exchange has created a software cryptocurrency wallet where you can transfer coins to hold securely. However, the hot wallet is only compatible with Ethereum and EVM-compatible networks.
Coinbase is the best option for beginners, thanks to the in-depth learning section.
Coinbase has recently updated its fee structure, resulting in lower costs.
Coinbase Earn allows beginners to receive free coins for completing quizzes.
Cryptocurrency Brokers To Buy Bitcoin In The UK
eToro is the most straightforward crypto broker to use when you want to buy or trade Bitcoin, thanks to the simple trading software. Their platform is made for beginners with user-friendly interfaces and easy-to-navigate features. Moreover, new investors can copy successful traders if they’re unsure how to diversify their portfolio.
Furthermore, eToro has multiple deposit methods to provide convenience, such as bank cards, Skrill, Neteller, and Yandex. Also, you can buy Bitcoin with PayPal.
However, the platform sells CFDs, meaning you will not convey ownership of your investments. Instead, you will be buying a derivative product, letting you speculate on the price of BTC.
eToro is licensed to operate in the United Kingdom.
eToro provides over 30 cryptocurrencies on their platform.
eToro is the largest CFD broker with over 24.8 million users.
Regulations and Taxes When Buying Bitcoin In The UK
Unlike many other countries, the United Kingdom doesn’t have short-term and long-term Capital Gains Tax rates. Instead, all capital gains are taxed under the same rates, and the amount you’ll pay depends on your profits.
10% on profits up to £50,270
20% on profits up to £150,000
20% on profits more than £150,000 plus an additional 20% on the first £150,000
Also, the UK has crypto tax breaks allowing investors to keep more profits. Your first £12,570 of income is tax-free by using the Personal Income Tax Allowance program. Moreover, the Trading and Property Allowance program lets investors keep £1,000 tax-free.
The United Kingdom is far ahead than most countries in terms of adopting cryptocurrency. The Treasury has announced that it will regulate some cryptos as part of a wider plan to make the UK a hub for digital payment corporations. The government has stated that stablecoins will become established payment methods giving people confidence in using digital currencies.
Other Considerations When Buying Bitcoin In The UK
When investing in Bitcoin, you should consider multiple factors beforehand. Below we’ve outlined the main things to contemplate when buying BTC in the United Kingdom.
Volatility: The cryptocurrency market is highly volatile, so prices often dip and rise significantly. Before you buy Bitcoin UK or other digital currency, you should consider if you can mentally cope with your portfolio taking a huge hit. Perhaps implementing an investment strategy is ideal for preventing panic selling and other mistakes.
Security: You should be wary of how secure your coins will be after purchase. Keeping them on an established exchange is excellent since most platforms have incorporated advanced protection technologies. However, keeping them on a private hot or cold wallet is still a far better alternative.
Transactions Can’t Be Reversed: Withdrawing cryptocurrency to a private wallet can be a nerving experience since one mistake can lead to losing all your coins. Therefore, you should ensure that the withdrawal address is 100% correct. Also, be wary of hidden viruses programmed to replace your copied wallet address with their own.
Privacy: Centralized crypto brokers and exchanges require users to verify their identity to access their services or lift restrictions. This is to comply with government laws like Know your Customer. However, this means that you lose privacy when buying Bitcoin, and the crypto platform can share your investing information.
Taxes: The cryptocurrency market is still in its infancy, and governments like the United Kingdom are adapting. The tax regulations are generous to current investors, but new laws can change this in an instance. Therefore, if you go for a long-term strategy with Bitcoin in the UK, consider the potential changes in regulations and taxes.
What Payment Methods Can I Use To Buy Bitcoin In The UK?
UK investors have access to multiple payment methods when buying Bitcoin such as a UK bank transfer. Below are the most popular and convenient deposit options.
Credit/Debit Card: These cards are widely available and convenient to use. To buy Bitcoin with debit card, simply write in your details, deposit amount, and hit send. To buy Bitcoin with credit card, the process is the same. Also, some platforms allow you to buy Bitcoin instantly without using the trading interface.
Bank Transfer: Buy Bitcoin with bank transfer or depositing via bank transfer is great if your credit or debit card is not accepted. The processing time to buy Bitcoin with bank transfer depends on your banking services, but most bank transfers are complete within a day. Also, double-check the reference code to ensure the funds will reach your bank transfer account.
Cryptocurrency: All crypto exchanges accept cryptocurrency as a deposit method. However, the fees and processing times depend on the coin you are sending. Therefore, we recommend using stablecoins or payment coins like XLM since they have ultra-low costs for transfers.
eWallet: Online banking services like PayPal are brilliant for depositing because some exchanges provide integrations. This lets users deposit quickly since the payment method doesn’t require typing in lots of information. Also, some eWallets allow investors to connect their bank cards to the system, making it more convenient to use.
How To Store Coins After You Buy Bitcoin In The UK
Understanding where to store Bitcoin is important, as is comprehending why Bitcoin storage is such a critical part of successful and safe Bitcoin investing. Once you buy Bitcoin on a cryptocurrency exchange, you’ll want to withdraw it to a private wallet. This is because they are safer and provide much better security than exchanges. However, you may find it difficult to decide which Bitcoin wallet to go for or if you should use a hot or cold wallet. Let’s examine each option and go over its pros & cons.
Hot wallets are great for small portfolios because they allow quick transactions and deposits to cryptocurrency exchanges. They provide better security than crypto exchanges because your coins are not pooled with other investors. Therefore, an exploit in an exchange system will not affect you by keeping funds in a hot wallet. Also, you have more control of your coins and can access various dApps. The best hot wallets for Bitcoin are Exodus, Coinbase Wallet, Luno Wallet, and Trust Wallet.
Cold wallets provide the best protection because they store your keys offline after you buy Bitcoin in the UK. Therefore, the only point of vulnerability is someone obtaining your written keys physically. Although they require an initial investment, they are highly recommended for those with large portfolios. The best cold wallets to store BTC are Ledger Nano X and Trezor One.
Apart from Bitcoin wallets, users can store some other crypto assets in some other specific crypto wallets. We show some examples below:
Buy Bitcoin In The UK. Final Thoughts
Buy Bitcoin in the UK is convenient due to the multiple available cryptocurrency exchanges and Bitcoin brokers. The platforms we’ve mentioned have user-friendly interfaces that make the Bitcoin buying process easy for beginners. Overall, the best way to buy Bitcoin BTC is through Coinbase since its system is tailor-made for novice investors. Buy Bitcoin with this platform provides educational resources, instant buying methods, and multiple trading pairs for Bitcoin.