Bitcoin exchanges happen in Bitcoin trading markets. Yes, there are several trading markets that allow people to buy bitcoins. The most famous among these bitcoin sites is Mt.Gox which is considered the world’s largest bitcoin exchange. It handles about 54% of all bitcoin transactions as of July 2013. Moreover, Mt.Gox has been in the bitcoin domain for almost 3 years since its establishment in 2010. Other popular sites include Bitstamp, Intersango, as well as BTC-E.
There are simple processes you must follow in order to acquire these digital currencies through bitcoin exchange. First thing you must have is bitcoin address. In order to get one, you must have a Bitcoin wallet. You can check our page about bitcoin wallets to know the sites where you can get them as well as the kind of wallet suitable to your needs and wants.
After getting a bitcoin wallet, you can now go to the Bitcoin Trading Market of your choice like CEX.io–which can be instrumental in promoting Bitcoin gambling in Latin America–and make an account and order for bitcoins. Then, you have to make a payment in the bank and within 3 to 4 days, you will receive your bitcoins. However, you must take note that the bitcoin exchange you have chosen is reliable since you will be entrusting your money to them.
Exchanging is done by placing “buy” or “sell” orders, which the exchange system software then matches with each other. “Buy” orders (or “bids”) are offers to buy bitcoins in exchange for another currency at a maximum price-per-bitcoin which is set by the offerer. “Sell” orders (or “asks”) are offers to sell bitcoins at a minimum price-per-bitcoin. If the bid price of a buy order is higher than the ask price of a sell order, an exchange can be performed and either the bid order, the sell order or both can be removed from the “order book”. Thus, at any given time, there is a Bitcoin price above which there are no more buy orders and a slightly higher price below which there are no more sell orders.
While it has become easier to buy and sell bitcoins with the influx of bitcoin exchanges across the world over the past couple of years, the availability of access to the currency has been one of the greatest sources of variability in its exchange rate. Because of looming government regulations, most notably the U.S., it has been a challenge to convert your local currency into Bitcoin, which has led to highly variable prices based on geography, which, for a currency which is designed to be borderless, has proven to be an issue, given that so many bitcoin users treat their bitcoins more like an asset than a currency. That is to say, they intend to hold onto their BTC until they decide to convert back into their local currency, rather than spend it online for anonymous transactions or Bitcoin games.