Buy Bitcoin Singapore : 2020 Guide For Buying Bitcoin (BTC)

2020 Guide For Buying Bitcoin (BTC) in Singapore

What You Need To Know About Buying Bitcoin in Singapore

Introducing you to Bitcoin

Bitcoin is referred to as a decentralized digital currency that can be transferred from a user to another via a peer-to-peer Bitcoin network without the need of any intermediaries or central bank.

A network of nodes authenticates transactions involving Bitcoins via a concept called cryptography.

These transactions are then registered on a public distributed ledger known as Blockchain.

Bitcoin was invented by an anonymous person or group of persons under the name Satoshi Nakamoto in 2008 and became operational in 2009 with the release of its open-source software.

Since Bitcoin’s introduction in 2009, its price has increased from cents to SGD26,500 at its peak in December 2017.

The meteoric rise of Bitcoin price in 2017 was fueled by a sudden large influx of investors due to the massive amount of attention Bitcoin was receiving in that year.

While Bitcoin has not yet returned to its peak (it is currently SGD12,500 at time of writing), the consensus is that it is only a matter of time before Bitcoin returns to its peak and surpasses it.

(Here’s why)
This article will provide you a guide on how to buy Bitcoin from 3 sources:

  1. Cryptocurrency Exchanges
  2. P2P (Peer to Peer) websites
  3. OTC (Over the Counter) Traders

Now let’s dive right in to how to buy Bitcoins in Singapore from each source!

Buying Bitcoins in Singapore
Other than mining, which is not what we will cover in this guide, the only other way to obtain Bitcoins is to purchase them.

Bitcoins can be purchased from either Cryptocurrency Exchanges or P2p (Peer to Peer) Websites.

Cryptocurrency Exchanges
There are plenty of Cryptocurrency Exchanges to choose from.

According to a 2018 Bloomberg News report, Binance is considered as the biggest cryptocurrency exchange in the world in terms of trading volume and has, in the author’s opinion, the cheapest overall trading fees (sign up with this link https://www.binance.com/en/register?ref=SSPZUH4A and get 25% off trading fees).

However, Binance does not have a function to deposit fiat currencies (SGD, USD etc.) so you will not be able to purchase your first Bitcoin through Binance.

The silver lining is, once you have obtained your first Bitcoin, you can transfer them to your Binance account and have access to trade numerous other Cryptocurrencies that Binance has to offer.

Some of the exchanges that do accept SGD are Coinbase and Liquid (formerly known as Quionex).

Before deciding on which Exchange to register with, consider the fees that these exchanges charge on deposits, withdrawals, and execution of trades.

These are the common charges a Cryptocurrency Exchange typically have:

Deposit Fees: Fee for receiving funds (SGD) into your account. Typically, around $10-$30.
Conversion Fees: If the Exchange only execute trades in a foreign currency, for example USD, the Exchange will convert your SGD into that currency and the comes at a 1-3% conversion fee.
Trading Fees: Exchanges charge a fee for each buy/sell trade executed on their platform. These fees can cost up to 3.99% each trade.
Withdrawal Fees: After selling your Bitcoin, you will want to withdraw the funds into your Singapore bank account. Most exchanges will charge a fee for processing your withdrawal. Liquid for example, charges 0.1% of the withdrawal amount (minimum of 15 SGD) on top of a bank processing fee of 35 USD.

The registration and verification process are similar across most of the Cryptocurrency Exchanges.

Here are the steps to follow:
Step 1 – Have these items ready
Government issued identifications (passports, driver licenses etc.)
Proof of address not older than 3 months (utility bills, bank statements etc.)
Camera (either on your phone or on your computer)
Piece of paper and a pen

Step 2 – Decide on an email address which you will use for the registration. Make sure that your email account is secured. A good way to secure your email account is to switch on the 2FA authentication option if available (I use Gmail).

Also make sure that your email account is logged in to any other devices that is not owned by you.

Step 3 – Sign up with your preferred Exchange.

After creating a new account on an Exchange, you will be subject to that Exchange’s identity verification process (to combat money laundering!).

This is where you will need the items in Step 1. Follow the website’s instruction and you will be good in no time!

Step 4Fund your account and buy your first Bitcoin!

P2P (Peer to Peer) Websites
There are multiple P2P Websites where you can buy Bitcoins.

The largest P2P Websites for buying Bitcoin is without a doubt www.localbitcoins.com. It is based in Helsinki, Finland, and has been operating since June 2012.

Its services almost all countries, Singapore being one of them.

On the website, you can simply browse through traders’ advertisements and select the advertisement that you want to purchase from. There is no fee when you buy and sell Bitcoins from the traders’ advertisements on Localbitcoins.

However, the traders do sell their Bitcoins at a premium (the Trader’s fees) usually between 3% to 4%.

Here are the steps on how to sign up:

Step 1 – Register for an account with just an email address. Again, please ensure that your email account is secured.

Step 2 – Complete additional verification. There are 4 Tiers of accounts in localbitcoins. All new users start at Tier 0, which limits you to buy only GBP 1,000 (equivalent to SGD 1,500 at time of writing) worth of Bitcoin. If you wish to buy more than SGD1,500 which is most likely the case, you are advised to complete additional verification first. You can upgrade your account Tier by clicking on the profile icon on the top right-hand corner of your Localbitcoins page, then click settings, and click verification.
Similar to the verification process on Cryptocurrency Exchanges, you might need these items:
Government issued identifications (passports, driver licences etc.)
Proof of address not older than 3 months (utility bills, bank statements etc.)
Camera (either on your phone or on your computer)

Step 3 – Search for advertisements. On the top left-hand side of the website, click on Buy. You should be able to then see a list of traders available in your region, and the price that they are selling Bitcoins at.

Step 4 – Select a Trader that you wish to buy from. After you start a trade with a Trader, it is common practice for the Trader to do his or her own verification on you. This may require you to provide photo of an ID and also a video call (because IDs can be stolen). Once the Trader has verified you, he/she will instruct you how to make payment.

Step 5 – After making the payment, remember to click on “I have paid” and the Trader will release the Bitcoin to you. Congratulations! You now own your own Bitcoin.

OTC (Over the counter) Traders
OTC Traders are business or individuals that are in the business of selling and buying Cryptocurrencies like Bitcoins. There are currently only a handful of OTC Traders that are operating as a registered business.

OTC Traders charge an execution fee of about 1.5% to 3% which can be significantly less than what you will be paying on P2P website and some Cryptocurrency Exchanges.

OTC Traders generally prefer payment to be made in cash and will also need to verify your identity to comply with anti-money laundering laws.

Here’s how to buy Bitcoin from an OTC Trader

Step 1: Find an OTC Trader. Finding a reliable and honest OTC Trader can be challenging especially if you are not in the Cryptocurrency industry. To help you find one, fill in this contact form and we will get an OTC Trader to contact you directly!

Step 2: Contact the OTC Trader and arrange for a meeting (should be in their office) to perform the transaction. If you don’t have your own Crypto wallet to securely store your own Bitcoin, the friendlier OTC Traders will even advise you on how to set it up.

Conclusion

In conclusion, there are several factors to consider when choosing where to purchase Bitcoins. We list out the pros and cons of each source:
Cryptocurrency Exchanges
Pros – The websites are available 24/7 for you to execute trades yourself.
Cons – Cryptocurrency Exchanges are a popular target for hackers and as a result, users’ Bitcoins and personal information can be stolen. Many hidden fees that can come up to 6% on some Exchanges (3.99% for credit/debit card buys and another 2% for converting currencies). Withdrawal fees when you want to cash out. Exchanges may occasionally experience difficulties in processing funds withdrawal due to bank issues.

P2P Websites
Pros – Available in almost every country. There is a huge range of payment options other than the traditional bank transfer (from Itunes gift cards to Alipay).
Cons – Traders may not respond promptly. When buying Bitcoin, there is a risk of you being an accessory to a money laundering operation. When selling Bitcoins, there is a risk of you receiving stolen money.

OTC Traders
Pros – If your OTC Trader is friendly enough, you get yourself a free advisor on Cryptocurrency matters. Can have the lowest overall fees. Accepts cash payments.
Cons – May not be available 24/7. Depending on the OTC Trader, you may have to travel to them for each trade. The limited number of OTC Trader that are operating as a registered business makes it hard to find one.

Register to get a bitcoin account today!