When it comes to bitcoin trading, you need a cryptocurrency broker you can trust. We’ve compared all your options to help you make the right choice.
Where can I find the best bitcoin brokers?
Right here. We have reviewed all the best and most reliable platforms out there to help you find the right one for you. Have a read through our reviews and see what you think. If you’re not ready just yet, scroll down and continue reading our helpful guide.
What is a bitcoin broker?
A bitcoin brokerage is a middleman for buying and selling bitcoin. In the same way that you’d use a bureau de change at an airport to exchange your currency to another, a broker is a company that will buy and sell bitcoin at a fixed price. Bitcoin brokers are also one of the only options that allow you to buy a very large amount of bitcoin at a time (for instance if you want to invest £50,000 or more).
How do brokerages work?
Brokers or trading platforms allow you buy bitcoin at a set value, which the platform or broker holds for you. Technically, using this method you do not own the coin itself, rather you own the value-change of it. Therefore, its a trade. If you buy bitcoin at £1,000 and it goes up to £1,100, you could sell it and keep the extra £100. Simple really.
How do I use a bitcoin broker?
It’s easy. Just go to the broker site and it will have the current rate at which they’re selling bitcoin displayed. If you’re happy with the price then set up an account, select how much you want to buy, then enter your payment details and get moving.
What should I look for in a broker?
Design and ease of use
The purpose of a broker is to make the process of buying bitcoin easier. You want to make sure the site is designed in such a way as to make it as simple as possible for you to navigate through and make your purchases.
Different brokers will charge a different amount for buying bitcoin, as any commission charged by a platform will be included in the price listed, referred to as spread. To find the best rate it’s a good idea to compare multiple platforms.
You want to make sure you’re getting a good deal on your purchase. Depending on the platform and your chosen payment method, there could be fees of 0% to 5% of the purchase amount, with credit card being the most expensive option.
You will want to be sure you are sending your money to a company that will not disappear with your cash. In the UK, brokers must be regulated so look out for this when reading reviews. There are many platforms that have been around for a while and have good reputations. Some of the common options you should consider include eToro and Coinmama.
Variety of coins
If you want to buy more than just bitcoin, you can find brokers with a range of cryptos. Platforms will usually offer all the top coins, and will often be more than happy to assist you in buying.
Do I have to verify my identity?
Yes, you have to verify your identity to register with a bitcoin broker. Usually you’ll have to provide proof of your ID (such as a passport and a driving license) and address (such as a utility bill or bank statement). Typically you’ll have to provide a selfie of you holding your photo ID to prove it’s yours.
What’s the difference between a bitcoin broker and an exchange?
On a Bitcoin exchange you buy and own bitcoin directly from other people, it’s peer-2-peer, whereas with a broker you’re buying the value of the coin from the platform. Exchanges are much more complicated to use as they have cryptocurrency price charts and constantly refreshing order lists; there’s a huge learning curve. A broker platform however handles the whole process for you and provides a fixed price.
Do brokers charge commission or fees for buying bitcoin?
Yes, but these are included in the price displayed. The price advertised is the price you pay, without any percentage commission being added when you’re entering your details. The only additional fees will be if a platform charges a fee for specific payment methods (e.g. credit cards).
Can I buy multiple cryptocurrencies through a broker?
Yes, most brokers sell a variety of cryptocurrencies, including the major coins such as Bitcoin, Bitcoin Cash, Ethereum, Litecoin, and Ripple at the very least.
Do I need a wallet to use a bitcoin broker?
No, as the platform holds all values for you.
Should I use brokers to buy and sell bitcoin?
Well, it depends. If you want an easy and seamless way to capitalise on the growth and price fluctuations of bitcoin, this is the best and most simple option. If however you’re looking to hold your own coins personally; to use, spend or otherwise – then an exchange is the better option.
Can I transfer from a bitcoin broker to my PayPal account?
Yes, however you must first sell your bitcoin value back to fiat. Many brokers allow payments to and from PayPal – so check this before deciding which one to sign up for.
Are bitcoin brokers available 24/7?
Yes, you’ll be able to buy bitcoin through a brokerage at any time through their website. However, customer service may be limited to office hours. Check the platform and learn about their working hours.
Can I use other cryptocurrencies to buy bitcoin through a broker?
No, this isn’t usually possible. Some platforms may accept cryptos as a form of payment, but most currently accept fiat currency such as GBP or USD.
Can I use multiple brokers?
Yes, you can – it’s your choice. Some people do this as a method to spread risk, or because some platforms have different benefits versus one another.
Are bitcoin brokers legal?
Yes, in the UK bitcoin brokers are legal. However, this may not be the case in all countries, so check the legal status of platforms in your home country before buying bitcoin through one.
Are brokers regulated?
Yes, however only go with the reputable brokerages that we have reviewed. Some slip through the process.
Do I have to pay tax on the profits I make on my coins through a broker?
In the UK cryptocurrencies are classed as an asset. This means you have to pay capital gains tax of between 10 and 20% (depending on your income) on any money made over £11,700 a year. In other countries this varies, especially depending on whether bitcoin is legal or not. Check the tax requirements of bitcoin in your country before initiating any transaction.
Can brokers hold my coins for me?
Brokers such as Coinbase usually have an integrated wallet where you can keep your bitcoins, but that’s not the case with most other brokers out there. Most others will not allow you to see a wallet, as technically you are holding a ‘trade’ rather than the coin itself.
Can I access my full trading history with a broker?
Yes, you’ll be able to see all the transactions you have made through your account. You will see the completed orders, and pending ones if you have any waiting on price fluctuations.