How to Buy Cryptocurrency in the UK (2024)?

If you’re wondering how to buy cryptocurrency in the UK or whether it’s even legal, you’re not alone. As cryptocurrency becomes more popular, many UK citizens are looking for secure and easy ways to invest. Fortunately, buying crypto in the UK is both legal and regulated by the Financial Conduct Authority (FCA), giving you peace of mind. 

In this guide, we’ll walk you through the process of how UK investors can invest in crypto safely, from choosing a trusted exchange to understanding the steps involved.

Key Takeaways:

1. The best crypto exchanges in the UK to buy Bitcoin are OKX, Coinbase, and eToro due to their FCA compliance, user-friendly platforms, and advanced trading features.
2. You can buy cryptocurrency in the UK by choosing a regulated exchange, creating an account, verifying your identity, funding your account with GBP, and making your crypto purchase.
3. In the UK, cryptocurrency is subject to Capital Gains Tax, and you must report any profits over £3,000 to HMRC, with tax rates ranging from 10% to 20%.

Where to Buy Crypto in the UK?

OKX

OKX is the best cryptocurrency exchange in the UK to buy Bitcoin and altcoins, and it stands out for both its features and compliance with UK rules. Due to regulations from the Financial Conduct Authority (FCA), the exchange also removed certain privacy-focused coins like Monero and ZCash.

If you’re in the UK, OKX offers over 40 different cryptocurrencies, including popular ones like Bitcoin and Ethereum. Its fees are competitive—maker fees start at 0.08%, and taker fees at 0.1%. If you trade a lot or hold OKB tokens, you get discounts on these fees. UK users also benefit from advanced trading tools, like TradingView integration, which offers better charts and insights.

For security, OKX uses things like multi-factor authentication and cold storage (where your crypto is stored offline) to protect your funds. Plus, they regularly publish Proof of Reserves reports to show your assets are fully backed. You can check our detailed guide in “Is OKX safe” for more information. The exchange also has a Web OKX wallet for users who are interested in DeFi services.

Coinbase

Coinbase is another top crypto trading platform in the United Kingdom. It’s easy to use, with a simple interface, and supports over 200 different cryptocurrencies.

It offers some great features for UK users. You can apply for a Coinbase Visa debit card, which lets you spend your cryptocurrency like normal money anywhere a Visa is accepted. It’s free to use for transactions but might have a small spread on prices. Another benefit is the Coinbase Wallet, which supports over 4,000 digital assets, including cryptocurrencies and NFTs.

Coinbase is regulated by the UK FCA and is also regulated for its e-money services. To buy crypto in the UK, you can add your payment method, such as a bank account or debit card. UK users also benefit from Faster Payments for free deposits, while withdrawals cost just £1.

However, it does come with some higher fees compared to OKX UK. If you’re using a debit card to buy crypto, expect to pay 3.99% in fees. On the other hand, bank transfers are free for both deposits and withdrawals. When buying or selling crypto, there’s also a 1.49% fee plus a 2% spread, which means you might pay slightly more or get slightly less than the market price.

eToro

eToro is one of the best cryptocurrency brokers in the UK. It’s regulated by the Financial Conduct Authority, meaning it adheres to UK financial laws. What makes eToro stand out is its CopyTrader feature. This lets you follow and copy the trades of other users, which is particularly helpful if you’re new to crypto trading. It also offers a good range of 100+ cryptocurrencies. The platform allows you to start trading with as little as $10, making it beginner-friendly.

In terms of costs, eToro is transparent. You’ll pay a 1% fee when buying or selling crypto. Withdrawals cost $5 (around £3.90), and there’s a $10 monthly inactivity fee if you don’t log in for a year. 

In addition to its cryptocurrency offerings, eToro provides access to a wide variety of investment options such as stocks, ETFs, commodities, and currencies. For UK investors, one of the highlights is the ability to buy fractional shares with as little as $10. This is a great way to get exposure to high-priced stocks without needing a large upfront investment.

The platform also has an educational hub known as the eToro Academy, which offers free resources like webinars, tutorials, and courses to help improve your trading skills.

How to Buy Crypto in the UK: Step-by-Step Guide

Investing in cryptocurrency in the UK can seem complicated at first, but it’s easier than you might think when you break it down step-by-step. The key is choosing a platform that works well for UK residents, is secure, and follows the rules set by the Financial Conduct Authority. In this guide, we’ll walk you through how to buy cryptocurrency in the UK:

Step 1: Choose a UK Cryptocurrency Exchange

The first thing you need to do is select reliable crypto trading platforms. In the UK, this is particularly important because you want to make sure the platform you use is secure, offers good fees, and complies with UK regulations. The FCA regulates crypto exchanges in the UK, so choosing an FCA-compliant platform is essential for peace of mind.

Some factors to consider include whether the exchange accepts GBP payments (so you don’t have to convert currencies), what cryptocurrencies are available for trading, and how much you’ll be charged in fees for transactions. Another important point is the level of security offered by the platform.

For this guide, we will be using OKX exchange that caters to UK users. It offers a good selection of popular coins, great trading tools, and competitive fees.

Step 2: Create an Account

Now that you’ve picked OKX, the next step is to create your account. Signing up on OKX is straightforward. Head over to the OKX website and click the “Sign Up” button. You can use either your email address or phone number to register. After that, you’ll need to set a strong password. You can also use our OKX referral code “12554491”, which offers a sign-up bonus of up to 10,000 USDT.

Now, you’ll be asked to go through a Know Your Customer (KYC) process. This means you’ll have to verify your identity. You’ll need to provide documents like a driving license or passport to confirm who you are. For UK users, OKX also has a short questionnaire to test your knowledge of cryptocurrency risks, ensuring you understand what you’re getting into before you start trading.

Note: After completing the verification process, OKX will activate a 24-hour cooling-off period. This waiting period ensures that you’re aware of the risks before jumping into crypto trading. While it might feel like a delay, it’s designed to protect new users.

Step 3: Fund Your Account with Crypto or GBP

To deposit GBP, head over to the “Deposit” section, and select GBP as your preferred currency. OKX offers various deposit methods, including bank transfers and debit or credit cards. There are no fees for depositing GBP on OKX, although your bank might charge you depending on your payment method. You can also choose “P2P trading” which offers more third-party payment methods like Wise, Payoneer, Revoult, Zen, and more.

If you already own cryptocurrency, you can also deposit that into your OKX account. Simply choose the crypto you want to transfer, and OKX will give you a deposit address to send it to. Make sure to double-check the wallet address carefully before transferring any crypto, as transactions are irreversible. 

OKX doesn’t charge for crypto deposits, but withdrawal fees depend on the blockchain network.

Step 4: Buy Cryptocurrency

To buy or invest in crypto, go to the “Trade” section on OKX. Here, you can choose the cryptocurrency you want to buy and how you want to pay for it. OKX offers two main ways to buy using USDT:

Convert: This is the easiest way to buy. You simply swap USDT or crypto for another coin in a few clicks, with no trading fees. It’s quick and ideal for beginners.

Spot Trading: If you’re a more experienced trader, you might want to use the Spot Market. This option gives you more control over your trades, letting you set specific buy or sell prices.

You can also directly invest in crypto in the UK using GBP through “Express Buy”. You just need to select the amount of GBP you are willing to spend and the cryptocurrency in exchange. Click on “Buy” and OKX will send your crypto to your exchange wallet.

Step 5: Store Your Cryptocurrency in Non-Custodial Wallet

Once you’ve bought your cryptocurrency, the next step is deciding where to store it. You can leave it on the OKX platform, where it’s protected by high-level security measures like two-factor authentication and cold storage. OKX frequently publishes Proof of Reserves reports, ensuring users that their funds are fully backed and safe.

However, if you want complete control over your assets, you can transfer them to a non-custodial wallet. It offers its own non-custodial OKX wallet, which is part of its Web3 ecosystem, allowing you to manage your crypto independently of the platform. If you prefer, you can also use third-party wallets, including hardware wallets like Ledger Nano X, which provide even greater security. Just go to the “Withdrawal” section and initiate the transfer. 

It’s generally recommended to move your Bitcoin holdings or other assets to a personal crypto wallet, especially if you’re holding it long-term or have a significant amount of assets.

Alternative Methods to Buy Cryptocurrency in the UK

If you’re learning about how to invest in cryptocurrency in the UK but want to try out alternative methods to traditional exchanges, you’ve got a few good options like crypto ETFs, peer-to-peer (P2P) exchanges, and cryptocurrency ATMs.

1. ETFs (Exchange-Traded Funds)

Crypto ETFs (Exchange-Traded Funds) are one of the easiest ways to invest in cryptocurrency without actually having to deal with the technical stuff, like setting up a wallet or managing private keys. Think of them like regular stock market investments, but instead of stocks, they give you exposure to cryptocurrencies like Bitcoin.

In the UK, while crypto ETFs are not as widespread as in the U.S., there are still options available, especially in European markets. ETFs like 21Shares or WisdomTree track the price of cryptocurrencies. You can buy them through regular brokerage platforms that support European ETFs.

The cool part about crypto ETFs is the convenience: they’re safe, traded on regulated exchanges, and you don’t need to worry about managing the cryptocurrency yourself. However, they do come with some fees (usually a small percentage) and may not cover all the cryptos you’re interested in.

2. Peer-to-Peer (P2P) Exchanges

Peer-to-peer (P2P) exchanges let you buy and sell cryptocurrency directly from other people. Instead of relying on a company to set the price and handle the transaction, you deal with individuals. It’s a bit like using eBay but for crypto. Platforms like OKX P2P and Paxful are popular for this.

One of the biggest advantages of P2P exchanges is the variety of payment options. You can use bank transfers, PayPal, or even cash in some cases. This flexibility makes it easy for people to find methods that work for them. Plus, sellers often offer better prices than traditional exchanges.

Most P2P platforms protect users by holding the cryptocurrency in escrow (a safe place) until both the buyer and seller confirm the transaction. But it’s still a good idea to check the reviews and ratings of sellers to avoid getting scammed.

3. Cryptocurrency ATMs

Cryptocurrency ATMs are another way to buy crypto in the UK, and they’re as simple as using a regular cash machine. These ATMs let you deposit cash and receive Bitcoin (or other supported cryptos) straight to your digital wallet. If you don’t have a wallet, some machines can even print a paper wallet for you.

However, there are a few downsides to keep in mind. First, cryptocurrency ATMs charge pretty high fees—anywhere from 5% to 20%, which is way more expensive than online exchanges. Also, there aren’t a ton of these machines around in the UK. You’ll mostly find them in countries like the United States. 

You can check the details of Bitcoin ATMs near you using platforms like CryptoATMRadar.

Is Cryptocurrency Trading Legal in the UK?

Yes, trading and cryptocurrency investing in the UK is legal, but it’s regulated. The Financial Conduct Authority (FCA) oversees the crypto market to ensure firms comply with laws designed to protect consumers. 

Although cryptocurrencies like Bitcoin (BTC) aren’t considered official money (like pounds or euros), the businesses that deal with crypto – such as crypto exchanges and wallet providers – must register with the FCA. This is primarily to prevent illegal activities like money laundering.

Cryptocurrency Taxes in the United Kingdom

Investing in cryptocurrency in the UK isn’t tax-free. The HMRC (Her Majesty’s Revenue and Customs) treats crypto as an asset, like stocks, so if you sell, trade, or use it for profit, it’s subject to Capital Gains Tax (CGT). For the tax year 2024-2025, you can make up to £3,000 in gains tax-free, but anything above that is taxed. If you’re a basic rate taxpayer, you’ll pay 10%, but if you’re in the higher tax bracket, it goes up to 20%.

However, if you earn crypto through activities like mining, staking, or getting airdrops, it’s counted as income. This means you’ll be taxed based on your regular income tax rates, which range from 20% to 45%, depending on how much you earn annually.

To stay compliant, you need to report your crypto activities when filing your yearly tax return. For paper returns, the deadline is 31st October, but if you file online, you have until 31st January. HMRC requires you to keep clear records of all your crypto transactions, including dates and values. Not reporting these activities can lead to fines or extra charges.

Final Thoughts: How to Invest in Cryptocurrency in the UK

In conclusion, learning how to buy cryptocurrency in the UK is easier than it seems. Start by choosing a regulated crypto exchange like OKX, Coinbase, or eToro, which comply with UK laws. After creating an exchange account and completing identity verification, you can fund it with GBP via bank transfer or debit card. Once your funds are available, you can purchase popular cryptocurrencies like Bitcoin or Ethereum. 

Make sure to keep your crypto holdings safe by using reliable crypto wallets, and always stay informed about UK crypto regulations and taxes to ensure a smooth and secure experience. Also, you shouldn’t put all the money into investments unless you’re prepared for the risks involved.

FAQs

Is Binance available in the UK?

Binance has faced regulatory challenges in the UK. The FCA has imposed restrictions on Binance, preventing it from offering new services to UK users until they find a new FCA-approved financial partner. While existing users can still use Binance for some services if they complete necessary investor declarations, new sign-ups and access to new products are temporarily halted.

What are the best crypto exchanges in the UK?

Some of the best crypto exchanges available in the UK include OKX, Coinbase, eToro, and Uphold, all of which are registered with the FCA and comply with UK regulations.

Which banks allow crypto in the UK?

Several UK banks allow transactions with cryptocurrency exchanges, though policies can vary. Major banks like Barclays, Revolut, and Monzo generally support crypto-related transactions, but with some limitations, such as blocking transfers to high-risk or non-regulated exchanges.

How do you buy Bitcoin in the United Kingdom (GB)?

To buy Bitcoin in the UK, start by choosing a reputable and FCA-registered crypto exchange such as OKX, Coinbase, or eToro. After creating an account, verify your identity as required by UK regulations. You can fund your account with GBP fiat currency using a bank transfer, debit card, or even services like PayPal, depending on the platform. Once your account is funded, you can purchase Bitcoin directly on the exchange. Now, you can transfer it to a secure Bitcoin wallet.