Buy Crypto & Bitcoin in the UK
Bitcoin and cryptocurrency are growing rapidly but can be intimidating to those unfamiliar. This article outlines the best crypto exchanges and wallets and current UK laws about how to buy Bitcoin in the United Kingdom.
Coinbase is our recommended option for those who want to buy cryptocurrency in the United Kingdom. Coinbase has been around for several years and consistently ranks as one of the best and safest exchanges to buy Bitcoin.
Best Crypto Exchanges in The United Kingdom
Summary of Best Crypto Exchanges in UK
Best Social Platform
The State of Bitcoin in the UK
Bitcoin, and cryptocurrency in general, has become one of the fastest-growing phenomena in recent years. Many believe it will, or already has, revolutionize the way we handle our finances.
The UK has quickly integrated Bitcoin into its economic culture and has become one of the largest markets for crypto in the world. As its popularity grows, buying and selling cryptocurrency will become easier, more common, and more accessible.
According to Cryptonews, 28 cities in the UK already have Bitcoin ATMs.
As it stands, there are lots of options for buying and selling Bitcoin. One of the safest and most frequently used is the Xcoins platform, where purchases can take place using a Visa or Mastercard bank card.
There is no legislative regulation on cryptocurrency in the UK because the government has now reached a unified agreement on it yet. Still, UK residents can legally buy and sell Bitcoin as they please.
Best Crypto Exchanges in the UK
UK crypto exchanges are an excellent medium for you to buy your Bitcoin safely and securely from a website or app. Many of these platforms offer high-security standards, proof of reserve, high liquidity, low fees and more.
Coinbase - Best Overall
Coinbase is the #1 crypto exchange and platform where you can buy, sell, and exchange digital currencies such as Bitcoin, Ethereum, and Litecoin. Coinbase fees vary based on your payment method. Coinbase offers U.K. customers bank, credit card, and debit cards.
Bank Account transfer fees are relatively low at about 1.5%, but it takes five days to get your coins. Credit/Debit Card purchases will cost you about 4%. The advantage to this is that you get your crypto instantly.
You can trade over 100 cryptocurrencies in Coinbase with over 9,400 digital assets listed.
eToro - Best Social Platform
eToro is a global investment platform that allows users to invest in Stock & ETFs, Cryptocurrencies, and C.F.D. Trading. Fees vary depending on if you're funding your account with fiat or cryptocurrencies.
Customers in the United Kingdom pay a spread of 0.75 percent to 5.0 percent on assets. Conversions from fiat to crypto will cost a 5% fee. There are zero fees charged on withdrawals, but the drawback is you have to withdraw at least $30.
eToro supports the trading of more than 40 crypto assets.
Binance - Largest Exchange
Binance is my favorite cryptocurrency exchange with a focus on crypto-to-crypto trading. The platform has a token called BNB to pay fees at a discounted rate.
You can also participate in their quarterly BNB token burn to generate additional value for all the coin holders. Binance can process fast orders, has multi-language support, and has over 60 crypto pairs available for trading.
Binance charges a 0.1% fee for spot trading and a 0.5% fee for quick buy/sell trades. You can also buy crypto via a free A.C.H. transfer or a credit/debit card transfer at 4.5%.
A wire transfer has a fixed $15 fee for buying tokens.
Gemini - Best Security
Gemini is probably the most secure regulated Bitcoin and Ether exchange, operating in the US, Canada, UK, Hong Kong, Japan, Singapore, and South Korea.
It also operates a dark ether pool, which enables investors to trade large blocks without revealing the underlying trade until they are ready. Gemini's fee schedule stipulates free deposits via wire transfers, but credit/debit cards get a 3.49% fee.
Bitpanda - Best All Around
Bitpanda is a company that aims to make investing in crypto accessible and easy for everyone. Cryptocurrency seems complicated from the outside, but Bitpanda creates a safe and straightforward process to make buying Bitcoin in the UK hassle-free.
Specifically, Bitpanda allows users to buy, sell, and trade over 100 digital assets, including crypto, stocks, precious metals, etc. They create savings plans and automated investments for their users for easy saving.
Bitpanda accepts a wide range of providers and payout methods to accommodate anyone with their current banking situation.
Best Crypto Wallets in the United Kingdom
Crypto wallets are like bank accounts, except they don't hold your currency. They store your private key, giving you access to the blockchain corresponding with the wallet.
Ledger Nano X
The Ledger Nano X is a multi-currency, Bluetooth-enabled hardware wallet that allows you to store Bitcoin securely, Ethereum, and many other supported coins. The device also supports Lightning Network payments for instant transactions between devices or friends without miner confirmation.
The Ledger Nano X costs $149 before tax, and you can buy it directly from the official website here. Supported Currencies: BTC, ETH, ETC, Dash DOGE, Zcash (ZEC), Ripple (XRP), and more.
Trezor Model T
The Trezor Wallet is a hardware cryptocurrency wallet designed to keep your currencies safe. The device also supports the technology of smart contracts, which allows you to create transactions on the Ethereum blockchain that are self-executing, self-enforcing, and impossible to rescind.
You can buy the Trezor Wallet for $215 directly from here. Supported Currencies: BTC, ETH, Litecoin (L.T.C.), E.T.C., B.C.H. (and all ERC20 tokens).
The Coinbase Wallet is a user-friendly online wallet that allows you to store over 4,000 assets. The app also provides access to Dapp's decentralized exchanges and offers the ability to create your token within seconds.
Coinbase has two versions of their wallet, one for mobile devices (Android & IOS) and one for computers (Browser Extension), which are all free. You can find the mobile wallet guide here and the browser extension guide here.
Supported Currencies: BTC, ETH, LTC, and all ERC20 tokens.
Crypto Laws & Rules in the UK
The UK is still currently developing laws regarding the purchasing and trading of cryptocurrency. The Taskforce Report has listed three sub-categories of crypto with the following explanations:
Exchange tokens - Also called “cryptocurrencies” like Bitcoin or Litecoin, a central bank or entity does not issue these. They can be used for exchanges or investments.
Security tokens - Security tokens fall under the Financial Services and Markets Act of “specified investments” and can be owned or used to pay money or investments in future profits. They can also be transferred to financial institutions.
Utility tokens - These can be exchanged for products or services using a DLT platform.
There are many benefits of using cryptocurrency, including:
Ease of Transaction - Cryptocurrency can be transferred digitally from a smartphone or computer
Public Records of Transaction - Transactions get displayed on a list called the blockchain, which allows people to see the history of Bitcoin exchanges prevents people from copying Bitcoins or spending crypto that they do not have.
Removal of “Intermediaries” - During UK crypto exchanges, banks or digital markets that oversee transactions are not involved, which cuts out processing fees.
Bitcoin is growing and becoming more prevalent. Many large companies now accept it, and buying Bitcoin in the UK is becoming much more popular.
Crypto Tax Laws in the UK
Tax rates for Bitcoin in the UK vary depending on the amount of crypto you have. Percentages range from 0-45%, with the normal being between 19-20%, as reported by Solicitors Guru.
There are some circumstances in which crypto gets taxed. For example, if you sold crypto at a higher rate than it was bought. Switching cryptocurrencies warrant taxation, as well.
If you receive payment in crypto, regardless of which cryptocurrency it is, you will have to pay taxes. Mining Bitcoin is also taxable. Income gained as a “hobbyist” or mining for business purposes will count towards your trading profits.
Airdropping crypto, however, is not taxed if it was not received from a mining exchange. If it was compensation for something, it must be reported as income.
Inheriting crypto, according to UK tax laws, is taxable. We view it as property. Defi, which encompasses lending or staking Bitcoin, can also be considered taxable income.
Should You Invest in Bitcoin or Crypto in the United Kingdom?
Bitcoin is a safe and easy way to invest and earn money. It can also be used to pay for products or services and is an excellent way of portfolio diversification.
Buying Bitcoin in the United Kingdom is only going to keep growing. With the help of companies like Coinbase, everyone who is able should invest in Bitcoin.
UK Crypto FAQ's
Here are some of the more common FAQs around UK crypto:
Yes, it’s effortless. All you need through a company like Coinbase is to create an account, and you will be walked through each step.
VISA and Mastercard bank cards are acceptable methods.
There are no territorial bans on cryptocurrency in the UK.
Yes, it is possible to buy Bitcoin in the UK anonymously through various exchange companies.
Yes, Bitcoin can be sold at any point.
Yes, you can invest in crypto in your SIPP