As one of the most popular and most valuable cryptocurrencies in the world, Bitcoin has become highly sought after. People are buying Bitcoin for a plethora of reasons, including investments, saving plans, and sheer interest in using digital currencies. As the popularity of this currency grew, governments in all major English-speaking regions introduced stricter laws and rules regarding the exchange of Bitcoin.
In other words, most exchange platforms and sources require users to provide a valid form of ID in order to make a purchase of Bitcoin. However, there are still a few ways you can buy Bitcoin without identification in countries such as the UK, US, Canada, Ireland, Australia, and New Zealand. In this brief guide, we are going to cover the basics of purchasing Bitcoin, why you need an ID to do so and where you can make a purchase without a valid identification document.
How to Buy Bitcoin
Before we dive into details with ID verification processes, let's cover the generic process of buying Bitcoin for those users who might have not done it before. Essentially, Bitcoin is a digital currency that can be exchanged for assets, other cryptocurrencies or fiat currencies, that is, the money that we use on a day to day basis. Therefore, if you are planning to purchase Bitcoin, you will need an asset or an amount of other currency that is equivalent to the value of this coin.
The easiest and most common way to purchase Bitcoin is through cryptocurrency exchanges. These exchange platforms serve as a matchmaking service between sellers and buyers who are offering or seeking the same assets. One of the most popular examples of crypto exchanges is Coinbase. Headquartered in San Francisco, California, Coinbase makes for one of the largest and most reliable cryptocurrency exchange platforms in the world.
However, it is definitely not the only option on the table. According to Forbes, there are around 200 active crypto exchanges that allow Bitcoin trading in the world. Therefore, there are plenty of other options to look into before you settle for your final choice. We will cover the essentials on how to choose the best crypto exchange for your needs further down in this guide.
Once you've settled for an exchange platform, you have to create an account and make a deposit to get started. While this is usually a very generic process, some platforms might require more or less steps to reach your first Bitcoin transaction. For more in-depth instructions, look for a detailed guide made specifically for the exchange you chose.
Generally speaking, purchasing Bitcoin through these platforms is quite simple. Once you place a deposit in your account, you can request an order of Bitcoin and place an offer that states how much you are willing to pay for your order. The platform will connect you to the most suitable seller by matching your offer with their asking price. Once you settle for a specific seller, follow the steps on the platform to confirm and finalize the purchase.
Do You Need ID Verification to Buy Bitcoin
While Bitcoin in itself does not require any form of ID, crypto exchange platforms and services might request you to go through a verification process for several reasons. The most reputable exchange platforms require ID verification in order to maintain high levels of trust and security. This is what allows them to keep their reputation as trustworthy and reliable services. Therefore, it’s no shock that they will require a detailed verification procedure.
Another reason why ID verification might be necessary is your location. Namely, governments in some of the largest countries of the world have introduced stricter rules when it comes to Bitcoin purchase and exchange. Depending on where the exchange platform is registered, they might be required by law to implement KYC procedures. KYC or Know Your Customer procedures include standard identification processes designed to keep financial transactions secure and prevent money laundering.
How to Buy Bitcoin without ID
Even though the majority of exchanges do follow KYC procedures, there are still ways to purchase Bitcoin anonymously in 2020. You might want to skip the verification process for several reasons - either to protect your privacy, purchase Bitcoin when you don’t have identification documents, or simply use the cryptocurrency for what it was intended to be - an anonymous and open-source asset. Here are some of the best methods for purchasing Bitcoin without an ID!
#1 Use the Right Platform
Purchasing Bitcoin anonymously can be as easy as choosing the right platform. Exchanges such as CEX and CoinMama are great places to make your first anonymous transaction. CEX.io is one of the few US registered crypto exchanges that allows buyers to purchase up to 100$ worth of Bitcoin per day without any ID verification. CoinMama, on the other hand, adds a bit more room to your options by allowing you to purchase up to 150$ of Bitcoin per day. While these are easy ways to accumulate Bitcoin without ID, it might take awhile for you to get to the exact number you are looking for given all these limitations.
#2 Check out LocalCryptos
If 100 to 150 dollars worth of Bitcoin per day is not enough to satisfy your needs, here's another method to look into. Sign up at LocalCryptos for a chance to exchange Bitcoin anonymously. This is a peer-to-peer marketplace that does not require any legal verification whatsoever. The platform allows you to connect with buyers and sellers to perform transactions both online and offline. It is important to mention that the LocalCryptos platform has its own pre-defined fees you should keep in mind, including a 0.25% fee for the market maker and a 0.75% fee for the buyer.
#3 Person to Person Transaction
Everyone knows that the easiest and sometimes the fastest way to purchase Bitcoin without an ID is to make a person to person transaction. This offline, in-person transaction allows you to trade as much Bitcoin as you want without needing legal documents. All you need is a fiat currency or any other asset that the seller is requesting. What many beginner Bitcoin users don't realize is that purchasing Bitcoin in person might even be cheaper than using a platform. For instance, you do not have to deal with transaction fees or any other additional costs, as the transaction is completely up to you and your chosen seller.
Many sellers who perform Person to Person transactions also sell Bitcoin at a lower price compared to the market. They can do so because they save money on the taxation and all the fees they avoid. Therefore, an in-person transaction might be a great option if you manage to find a good seller in your area.
#4 Use a Bitcoin ATM
As Bitcoin is becoming more and more popular in daily use, companies have started to put out Bitcoin ATMs at some of the most popular locations across English-speaking countries. These machines operate similarly to regular ATMs, except that they allow you to purchase a valuable cryptocurrency without any ID. All you have to do is scan your public address and deposit an amount of fiat currency equivalent to the amount of Bitcoin you are looking to purchase. Keep in mind that not all Bitcoin ATMs operate the same way but all of them allow you to make anonymous purchases and transactions.
#5 Use Bitsquare
Bitsquare is another peer-to-peer marketplace that allows you to exchange cryptocurrencies in a fully decentralized environment. It does not require any legal documentation or verification procedures. You don’t even have to state your real name when making transactions. As a completely anonymous exchange platform, Bitsquare uses Tor for additional safety. They also never hold any currencies on their servers. Everything from start to finish of your transaction is completely decentralized and anonymous. We won’t go in depth on how Bitsquare operates but we do recommend looking into this solution if in-person transactions or Bitcoin ATMs are not an option.
#6 Use Mycelium
Mycelium is a very popular Bitcoin wallet that offers a few extra features including anonymous Bitcoin exchanges. One of its best features is the Mycelium Local Trader that allows you to trade Bitcoin through a mobile app. This feature is available globally and all it needs is your phone’s location so it can connect you with nearby sellers. Once you’ve made that connection, you can agree with the seller to meet in person and complete the transaction in a way that suits both parties. When you meet the seller, make sure they confirm that they have received cash in front of you. That way, the transaction will be completed automatically and there won’t be any risk of scams or fraudulent activity.
#7 Wall of Coins
Wall of Coins is another interesting marketplace you can look into for anonymous purchases of Bitcoin or any other cryptocurrency. This marketplace, however, operates a bit differently compared to the other options we’ve listed. As a cash-based system, the network requires you to make a deposit in a bank in order to complete the transactions. The system matches you with the right seller who provides their bank account details. You then have to deposit cash to their account in the bank and provide a proof of that transaction. The network will then release the agreed amount of Bitcoin that was held in Escrow. It is important to address that Wall of Coins is currently available in the USA, Brazil, Germany, Canada, the Philippines, Latvia, and Poland.
#8 Additional Exchange Platforms
If none of the options we’ve listed above sound like a suitable solution for you, you can check out other platforms such as ShapeShift and Changelly. Even though both options don't require any legal documentation, Changelly does require an email ID. However, you can easily use an alias here and avoid revealing your true identity. Even though both options provide quite competitive exchange rates, you will need altcoins such as LTC, ETH, or DASH to exchange for Bitcoin, as you cannot do so with a fiat currency.
How to Choose the Right Exchange for Buying Bitcoin
With dozens of crypto exchanges available globally, it might be difficult to choose only one platform to perform your transactions. Since you’re reading this guide, we will assume that anonymity is one of your top priorities when choosing the right exchange. However, you cannot base your choice solely on whether or not there is ID verification involved. There are other factors that play a crucial role in determining whether an exchange is safe and worthy of your assets. Here are some of the factors you should keep in mind:
- Good Reputation - To begin with, you should choose an exchange that has a good reputation that they try to maintain. Make sure to read multiple reviews on each exchange you’re interested in to learn more about the way they are perceived as well as how good the actual transaction experience is.
- Security and Insurance - Choose an exchange platform that invests into security protocols. Since they’re dealing with financial assets, crypto exchanges are a common target for hackers and cyber criminals around the globe. The exchange you choose should include the basic safety measures, as well as an insurance fund to cover any losses due to potential security risks.
- Fiat Exchange - One of the mistakes new traders often make is that they forget to check whether the exchange they sign up for accepts fiat currencies. Some exchanges allow you to only trade crypto for crypto, which means you cannot use a regular currency such as dollars to make a transaction. Look for exchanges with a variety of fiat and crypto options for both deposit and withdrawal.
- Leverage Trading - If you are interested in leverage trading, finding a good exchange that offers this service will be crucial for the quality of your experience. This feature allows you to make trades with borrowed money as long as you have a certain amount of assets in your account. Leverage trading is only provided by secure and trustworthy platforms so it can be a good indication of value and reputation.
- Fees and Prices - Lastly, look for exchange services with favorable prices and reasonable fees. While nearly every service will take a certain percentage off your transaction, there are platforms that offer lower fees than others. Finding those can help you save some money and perform better trades.
Frequently Asked Questions
Here are some of the most commonly asked questions when it comes to purchasing Bitcoin without ID verification.
#1 Is Purchasing Bitcoin without ID Legal?
The number one concern most new buyers have is whether it is legal to purchase Bitcoin without an ID. While presenting fake or incorrect IDs to services that require such verification is highly against the law, there is nothing wrong with purchasing Bitcoin without an ID on platforms that allow such anonymity. Therefore, the short answer is no, purchasing Bitcoin without an ID is not illegal, as long as you are doing so at the correct place.
#2 Is It Legal to Buy Bitcoin in Person?
Yes, in most countries it is completely legal to perform in-person transactions of any crypto currency. As long as you made a fair agreement with the seller and you both stick to the plan without any fraudulent intent, it is completely legal to perform such a transaction.
#3 Are Person to Person Transactions Risky?
Naturally, there is always a certain level of risk involved with person to person transactions, especially if you don’t know who you’re meeting in person. However, as long as you find your buyer or seller on a reputable platform or source, and can check out their history, this can provide a level of comfort. Always be on high alert though!
#4 Can You Sell Bitcoin without ID?
Yes, you can sell Bitcoin without an ID the same way you would buy it either through in-person transactions or via platforms that allow this level of anonymity.
#5 Do You Need a Wallet to Buy Bitcoin without ID?
Yes, regardless of which option you choose when purchasing Bitcoin without an ID, you will need a wallet to finalize the transaction. That is because the wallet is essentially the only place your Bitcoin can be sent to.
Conclusion
Regardless of why you’re purchasing Bitcoin, there are many good reasons why you should want to keep your privacy intact. .
However, keep in mind that no method is completely clean in terms of leaving a trace. Experienced users can always track you down using advanced methods such as tracking your phone location or vehicle data they collect during an in-person transaction meeting. If you require full anonymity, we recommend taking the extra steps to protecting your identity, such as using a VPN or agreeing to meet at a neutral physical location.
