Bitcoin is the most popular cryptocurrency around the world and it’s only increasing in popularity. As the platform’s popularity increases, so too does its user base. Consequently, it’s become more and more important to ensure that the proper safety mechanisms are put in place to protect both buyers and sellers.
So, when you go to purchase Bitcoin, there are certain things that you need, generally speaking, in order to be able to complete the process:
Without these things, you won’t be able to proceed with your purchase.
Although it may seem like a tiresome process – you may even be concerned about giving away copies of your identification documents – proving your identification is a really important part of safeguarding the buying and selling of Bitcoin, as well as protecting the reliability and integrity of the cryptocurrency as a whole.
Indeed, the reason identification verification is required to purchase Bitcoin is to be able to avoid fraudsters. By obtaining access to your ID, crypto companies are able to quickly and effectively weed out fraudsters in such a way that the scammers aren’t allowed access to the markets and innocent consumers aren’t affected.
The short answer is yes, there are ways to buy and sell Bitcoin without having to go through the identification verification process. However, there are several catches, most of which will speak more about a bit later. Essentially, it often ends up being more expensive and you’ll have fewer options.
If you’re dead set on not sharing your identification with anybody via the internet and want to conduct your cryptocurrency business anonymously, there are ways. Namely:
P2P marketplaces are a specific kind of cryptocurrency marketplace that allows buyers and sellers to have direct contact and make the sale between themselves. Different users can select their preferred payment methods and sometimes, but not very often, you may find somebody selling Bitcoin that is willing to accept cash.
Now, it’s important to understand what a cash purchase entails. Firstly, it doesn’t require identification verification because the sale isn’t going through online. However, it means that you’re going to need to meet up with the seller in person in order to verify the sale yourself.
Meeting up with a stranger you met online always has its risks and it’s really important that you’re careful about how you do this. Meet in a public place, tell someone where you’re going and just be aware and alert – you don’t want to be scammed. Essentially, when you choose to go the cash route, you’re forfeiting the safeguards that the marketplace offers both buyers and sellers when you choose to go with other payment methods, so you’ll need to decide for yourself whether anonymity is more important than this.
A few of the most popular and most reliable P2P Marketplace platforms that work with Bitcoin are Paxful and LocalBitcoins.
Here’s a step-by-step guide for how to purchase Bitcoin anonymously on a P2P marketplace:
We’ve spoken about how you can get around the identification verification requirement by making use of a P2P marketplace, and that certainly is a viable option. However, as we explained, it comes with its own issues.
Luckily, there’s one other way – via Bitcoin ATMs.
So, what is a Bitcoin ATM?
Like a standard cash automated teller machine, a Bitcoin ATM is a little kiosk that allows users to buy and sell Bitcoin, and other selected cryptocurrencies too, using a debit or credit card. Some of these ATMS only allow the selling of Bitcoin, some only allow purchases but if you’re lucky, you may even find one that offers bi-directional functionality – that is, buying and selling of Bitcoin.
These ATMs are becoming more and more popular and are starting to pop up all over the world in shops and other public areas. It seems as though this number is growing, and one of the reasons for this is that in order to buy or sell Bitcoin at one of these ATMs, you don’t need to verify your identification. Thus, for all intents and purposes, the process is far easier and doesn’t require as much time, effort and paperwork – and you can maintain your anonymity if that’s your preference!
Here’s how you can buy Bitcoin from a Bitcoin ATM:
It’s as easy as that. But let’s look a little deeper into all sides of this option. We’ll start with the pros and move onto the cons.
Thus, we’ve provided you with two very plausible options when it comes to finding ways to buy Bitcoin without verification. But even so, there are a few additional considerations that you really ought to bear in mind when contemplating purchasing Bitcoin in one of these ways.
Firstly, while nobody can predict the future, it’s plausible to believe that in the future, it won’t be quite as easy to purchase Bitcoin without verifying your identification first. Indeed, tighter regulations are being introduced in an attempt to put a stop to money laundering and other legal activities. Understandably, Bitcoin and other cryptocurrencies have the potential to become the targets for certain types of shady business.
The other point, and this may or may not affect you depending on how much Bitcoin you’re wanting to purchase, but there are limits on how much you can buy without verifying your ID. Now, if you’re only wanting to stick to the small leagues, this may not seem like a problem for you. However, once again, it’s possible that these limits may change in the coming years, allowing users to purchase less and less Bitcoin before verifying identification. Thus, this is a factor to consider.
Now that we’ve looked at a few different ways to purchase Bitcoin without identification verification, it’s a good idea to properly analyse all the pros and cons of each, in a general sense (and in addition to the specific ones we’ve already covered).
Now, if the reason you don’t want to go through the identification verification process is because you want to maintain your online privacy, there are a few other ways that you can accomplish this. They’re not quite the same as not having to provide your ID at all, but they specifically aim to protect your privacy.
Here are a few alternative ways to maintain privacy while buying Bitcoin.
There are a select few platforms out there that are able to help you improve your privacy even though you provide them with your identification. Essentially, they break the link between the source and recipient address. An example of one of these platforms is Blender.
By using multiple different wallets to store your coins, you bring to life the “don’t put all your eggs in one basket” metaphor. This will simply make your Bitcoin assets more secure and if you’re concerned about your identity being compromised online, or hackers gaining access to your private accounts.
You may have heard of a VPN and it’s something that can be very useful in this scenario. By using a VPN when conducting your Bitcoin transactions, you’ll prevent hackers from being able to trace your computer using your IP address, making you more secure.
Well, there you have it. It most certainly is possible to buy Bitcoin without having to verify your ID – namely via a Bitcoin ATM or by using a P2P marketplace. But these options come with their own pros and cons. So make sure you consider everything before you decide how you’re going to buy your Bitcoin.