Buy $100 in Bitcoin at Kraken


If you want to know where to buy Bitcoin, this is the place to start.

First, this is the safest place to buy $100 in Bitcoin. You won’t get ripped off.

Second, you’ll learn the process to buy bitcoin from start to finish. No more guessing.

Once you know the buying and selling process, you can sell and buy bitcoins the rest of your life.

And last, your bitcoin will be safe from hackers.

Let’s start.


Stick With American Bitcoin Exchanges

If you want to buy Bitcoin, stick with a cryptocurrency exchange based in the United States. That makes your dealings in cryptocurrency more secure.

The cryptocurrency exchange with the best reputation for security is Kraken. Kraken has never been hacked. Kraken has 100% in reserves to back all your cash and cryptocurrencies. That means you can to take out your cash or digital coins at anytime.

Don’t go dealing with some slick character in Slovenia promising to sell you Bitcoins at a 50% discount. You will get burnt.

The First Level of Protection for Your $100

A cryptocurrency exchange located in the US will agree to operate under a set of rules established by regulators in the federal government. This offers a measure of protection for your investment dollars.

I know…federal bureaucrats have a reputation for bungling even simple matters and getting everything wrong. In many areas of the federal government, that reputation is well-deserved.

Then again, consider the psychology behind digital coins: cryptocurrency is new territory in the regulatory field. As such, it is attracting regulators who are enthusiastic about digital coins and want to see them succeed. Anything new will attract true believers and cheerleaders.

We have not seen front page stories of American cryptocurrency exchanges stealing millions of dollars of investor deposits. That’s because it’s not happening. The regulatory milieu of cryptocurrency is one of the elements protecting your dollars. In the end, it’s all about protecting your dollars and bitcoins from theft, right?

With that in mind, my recommendation is to go with Kraken to buy your first cryptocurrency. You can start with as little as $20. If the world ends, all you’ve lost is a week’s  supply of Starbucks coffee.

Let’s explore Kraken.

An American Company With No Monkeys

Kraken has been located in San Francisco since 2011, so if you want to visit Kraken you don’t need a passport. It’s not located in a ramshackle stall on a two-track road between kumquat growers and donkey rentals, somewhere in the Carpathian Mountains.

The water at the cooler is potable, and rogue monkeys hanging in trees won’t steal your bag of peanuts.

100% Reserves Cover Assets

Besides selling and trading cryptocurrencies, Kraken is a sophisticated exchange that offers margins and futures trading for professionals. It makes sense, then, that when you’re dealing with bitcoin whales and high-rollers, Kraken wants to make these experienced traders comfortable and secure. If you make these people angry or don’t earn their trust, they’ll pull up their stakes and go elsewhere.

That robust security afforded to wealthy players is also given to new bitcoin buyers just starting out. That’s a definite plus and good reason to chose this exchange. Kraken has about 4 million users.

Kraken holds 100% in reserves to cover digital assets. It’s not like a US dollar bank that only holds 10% reserves to cover demand and checking deposits.

Kraken’s reserves serve as a guarantee that customers and traders can withdraw all their digital assets at any time. Kraken undergoes periodic reserve audits that ensure the crypto-coins really are in reserve.

Kraken Has Never Been Hacked

Kraken has a reputation as a company that takes security seriously. Kraken has never been hacked. Other exchanges outside the United States have lost millions and millions of dollars of Bitcoins to hackers.

One of the reasons why Kraken has never been hacked is because all deposits are kept offline in cold storage. That means that hackers pecking on keyboards to gain access to your bitcoins can’t get at them. Your coins aren’t hanging around online waiting to get picked off.

Kraken recommends that coin owners store their cryptocurrencies on cold wallets for additional security.

Signing Up on Kraken

When you click on the Kraken website, you’ll be taken to the welcome page. In the upper right corner is the “Create Account” button. Click on that and the “Create Your Account” screen pops up.

You fill in your email, user name and password. Then agree to Kraken’s terms and click “Create Account.”

(Note: Kraken is extremely security conscience. Kraken will encourage you to create a secure password. Using the word “PASSWORD” just won’t cut it. Specific instructions are provided at the “Buy Bitcoin Here” link at the end of this article.)

You will receive an activation code from Kraken sent to your email address. Click the link. You’re done and now have a Kraken account.

The sign-up process is simple and smooth.

Verify Your Account

Kraken offers three account levels. They are:

1. Starter

2. Intermediate

3. Pro

The Starter account level allows you to begin buying and selling digital assets. You can also deposit and withdraw cryptocurrencies. Note that you can’t buy Bitcoin with fiat currency (US dollars) at this level. In other words, you can’t deposit $100 US dollars and buy Bitcoin.

If you already own cryptocurrency like Bitcoin or Ethereum, you can deposit those digital coins at Kraken on this account level and start trading, buying and selling digital assets on Kraken.

Information, Please

To get verified in the Kraken Starter account, you must provide the following information:

1. Full name

2. Email address

3. Primary address (Where you live)

4. Phone number

Kraken will verify that information in a few minutes. You’re done. As stated above, you can deposit cryptocurrencies into Kraken at the starter level. However, you can’t buy cryptocurrencies with US dollars. You need to sign up for the Intermediate account. You’ll need to go to the next step.

Signing Up for the Intermediate Account

This portion of setting up your Kraken account requires verification of who you are. Our dear Uncle Sam requires this as part of its Know Your Customer (KYC) regulations. This regulation exists to ostensibly thwart crooks from laundering money.

Regardless of which exchange you go to buy Bitcoin with US dollars, identification will be required. If you go to a source that doesn’t require this verification, you will be placing your money at risk.

Smile For the Camera

To get verified at the Intermediate level, you will need to submit the following information:

1. Employment

2. Social Security number

3. The front and back or your drivers license

4. A photo of yourself holding your drivers license and a hand-written note with your signature and the date

5. A copy of your utility bill, credit card statement or phone bill to confirm your address

Detailed, illustrated instructions about the verification process are available at our “Buy Bitcoins Here” article.

The process to verify this information will take one to five hours. Kraken will send affirmation to your email account.

The Pro account is designed for institutions, bitcoin whales, corporations, brokerage houses and other high rollers. You need not concern yourself with this.

Set Up Two Factor Authentication (2FA)

If you’ve never used 2FA before, this is the most daunting task in signing up for a Kraken account. You need to decide which app you’ll use for 2FA. You need to understand how it works. You can run your 2FA app from either your mobile phone or your desktop or laptop computer. Kraken recommends using YubiKey. This is a device that generates 2FA security codes.

Kraken requires the use of 2FA for your account. This exchange has never been hacked, and 2FA is part of its impenetrable security wall.

2FA is explained in detail at Kraken’s support page under the Account Security section. You can read about 2FA at the Kraken website here.


Kraken offers various levels of security, including two factor authentication (2FA) through a Goggle app and YubiKey.

YubiKey is a physical device, much like a tiny thumb drive, that generates 2FA codes to secure individual accounts. This hardware key is more secure than a password because it can’t be copied. You can read about YubiKey here.

YubiKeys range in price from $20 to $70.

Kraken also offers other levels of security that govern deposits and withdrawals.

Quite simply, Kraken’s dedication to security make this exchange one of the safest exchanges in the world.

Kraken also has $100 million in insurance to cover potential losses.

About Kraken Support

A couple of years ago, people slammed Kraken for poor support. Since then, the exchange has upped its game and offers a ton of support, especially for beginners starting their cryptocurrency journey.

Kraken has detailed and extensive support pages that cover everything a beginner needs to know about buying and selling cryptocurrencies on Kraken. If you get stuck, click on the “Chat” button.

The 24/7 Chat Button

Online help at Kraken is only a click away. Simply click the chat button, and a live person will pop up to answer questions. The 24/7 chat button is located on the lower right corner of Kraken’s screens. A Kraken employee is available 24 hours a day, seven days a week. That’s all cool. It saves time from fishing around for answers on the web or from the Kraken website itself.

The help people seem to be set up in compartments. If one helper can’t answer a question, you’re passed along up the chain to another person until your question is answered. They will help you through the whole process until you’re signed up. The people at Kraken answered all questions to my satisfaction.

This service is far above what other exchanges offer. Other exchanges may operate via email exchanges. And asking and answering questions via email can slow everything to a crawl.

The chat button is a big plus and earns five stars.

In Depth Support

At the top of every page is the support button. Clicking that button will take you to all of Kraken’s support articles. These articles cover the following:

1. Getting started

2. Mobile Apps

3. Account Security

4. Account Verification

5. Fiat Funding

6. Cryptocurrency Funding

7. Staking Funds

8. Instantly Buy Crypto

9. Trading

10. Kraken Terminal & Cryptowatch

11. API

12. Account History

13. Futures

14. Futures – API

15. Other resources

These support articles give you the complete toolbox to understand how Kraken operates. If you wish to read these support articles, this link will take you to the Kraken support page.

Let’s Dive Into a Support Page

For example, the Account Security article explains the following:

A. Security Basics

This section includes information on how to secure your Kraken account. It details how Kraken protects your data and alerts you to common phishing scams.

B. Login Trouble

Includes instructions if you can’t sign into your account.

C. Two Factor Authentication (2FA) Troubleshooting

This section includes information on authenticator apps, using the YubiKey and backup codes.

D. Email Security

This explains how to secure your email, how PGP encryption works and setting up encryption for your email.

E. Security of Funds

This explains how Kraken holds your money and digital coins.

F. Two-factor Authentication (2FA) Basics

This lays out the 2FA process to protect your account. It looks scary at first, but setting up 2FA is easy. And remember, if you have a question, hit the Chat button.

You don’t need to read all this stuff. Questions concerning things like setting up 2FA for your account will be answered as you go through the sign-up process. The point is, if you want to completely understand how Kraken operates, you can read through the support articles.

The support library completely lays out how Kraken operates, including instructions to navigate through the Kraken site.

You can also fill in a support ticket for detailed answers to your questions.

Support gets five stars.

Depositing US dollars Into Your Kraken Account

Now, the fun part begins – buying Bitcoins. With your Intermediate account approved, you’ll need to move dollars from your bank account to a custody service. It’s similar to opening a brokerage account in order to buy stocks. A custody service holds dollars on behalf of a client.

You can open an account with either Etana Custody or MVB Bank. Open the account with MVB Bank. It’s much easier. Etana Custody requires clients to jump over more verification hurdles.

The process to select MVB to deposit your dollars is easy.

You will select the deposit button on the screen and choose MVB Bank in the drop-down menu. A screen will appear with all the information you need to wire money to MVB Bank. The information will include a reference code, an account number and bank routing information.

Print this information out. It has routing info and account numbers needed to wire money from your bank to MVB.

Take the info to your bank.

Tell your bank the amount you want to send.

The name on your bank account must match the name you entered for your Kraken account. If the names don’t match, you will be subjected to needless hassles.

Get a receipt from your bank.


Detailed instructions to buy bitcoins are included on our Bitcoin Colosseum website in this “Buy Bitcoins Here” article.

Choose MVB Bank

You can also send money to Etana Custody. This is an additional hassle that requires you to go through another lengthy verification process. My recommendation is to avoid this option.

Be aware that funding your Kraken account is literally changing by the hour.

The state of Wyoming recently approved a charter for Kraken to operate a cryptocurrency bank. Kraken will operate this bank under a subsidiary called Kraken Financial. Further information on this development is forthcoming.

In the meantime, fund your Kraken account with MVB Bank. It’s simple to use, and it works.

Credit and Debit Cards

You cannot buy crypto at Kraken with credit or debit cards in the United States. You can buy cryptocurrencies at Kraken using a credit or debit card issued by a European bank.

For some reason, credit and debit cards issued by US banks cannot be used to buy bitcoins at Kraken. I’m guessing this will change after Kraken’s new cryptocurrency bank in Wyoming becomes operational. Also be aware that you must have an intermediate account before you can buy bitcoins with a card.

Buy 44 Crypto-Coins

Kraken currently offers 44 digital coins you can buy. You can also swap/trade different digital coins. For example, you can trade your Bitcoins for Ethereum and vice-versa. For an up-to-date list of trading pairs, click here.  This link will take you to the Kraken web page. The list will include the different fiat currencies you can use to buy cryptocurrencies.

The other list shows which cryptocurrencies you can trade. For example, you can exchange Litecoin for Bitcoin, but you can’t exchange Litecoin for Dai.

Be aware that various cryptocurrencies can be added to or dropped from Kraken’s trading board at any time.

Mobile Apps

Since many people access Kraken via mobile phones, I want to cover this support article briefly. This mobile apps support article will teach Kraken users the following:

A. App Setup

Why the Kraken Pro mobile app runs on API. Generating QR code and API key on the Kraken mobile app.

B. App Troubleshooting

Covers troubleshooting steps for the app. Learn how to clear the cache in the app.

C. App vs Web Differences

Explains how to deposit and withdraw funds with the mobile app.

Get Started on Kraken Now

Do you feel you have enough information and want to get started now with buying bitcoins?


Here is a link to an illustrated article on Bitcoin Colosseum that explains, in detail, how to buy Bitcoins from Kraken.

Kraken Summary

The design of the Kraken website is pretty straightforward. All you’re doing is clicking on buttons and filling out forms. As you finish one screen, the next screen pops up with instructions.

Essentially, you’re popping from page to page, clicking buttons and filling in information.

For a person who never bought Bitcoin on an exchange before, the whole process went smoothly.

There are no pop-up ads to distract you. That’s good.

As for the verification requirements, yes, it’s a pain in the butt. Know Your Customer (KYC) is designed to stop money laundering by crooks. If you’re buying bitcoin on an American bitcoin exchange, you can’t escape this requirement. It’s called the verification process. If you go through some route that doesn’t require verification, you will risk losing your money.

Why You Should Stick to Kraken

Quite simply, buying bitcoin outside of US exchanges is not recommended for beginners.

Citizens of other countries have Bitcoin exchanges where they can buy bitcoins. Avoid these. In total, there are nearly 200 cryptocurrency exchanges in the world. When starting out, stick to the US exchanges.

First off, most bitcoin exchanges in other countries are not open to US citizens. If you go to these other exchanges, you’ll be politely told to buzz off; you can’t buy bitcoins there. So why waste your time reading about other exchanges that don’t want your business?

Be aware that any exchange outside of the United States accepting your dollars could rip you off. If you don’t want a really sad day, avoid traveling down this road. Some of these fly-by-night exchanges outside the United States are run by real dirtbags.

The Mt. Gox Warning

Security problems also are persistent in exchanges not based in the United States. These exchanges get hacked – a lot. When these exchanges get hacked – including your account – your bitcoins are lost . You’ve been robbed. And an internet bloodhound to track down these hackers to get back your bitcoins hasn’t been invented yet.

For example, Mt. Gox, then the largest bitcoin exchange in the world, lost 850,000 bitcoins in a 2014 hack. The bitcoins had a value of $473 million. That hack from this Tokyo bitcoin exchange remains the largest bitcoin theft ever. The exchange closed operations and former customers are still waiting for compensation.

The Cotten Tale

In Feb. 2019, the CEO of the QuadrigaCX exchange, located in Canada, unexpectedly died while building an orphanage in India. Yes, an orphanage.

Founder Gerald Cotten held all the cryptographic keys to the cold crypto-wallets where all the users’ bitcoin were stored. Exchange users lost about $200 million in bitcoins. The coin owners are still waiting for a resolution. Read the complete telling of the QuadrigaCX tale on our site here. It’s titled “200 Million in Bitcoin Vanished in the Land of Cobras.”

( Note: Cold wallets are used to store bitcoins offline, protecting bitcoins from online hackers. Cold wallets are one of the safest means to protect your bitcoins from theft by hackers. )

Bitcoin ATMs

Stay away from these. Bitcoin ATMs are kiosks that allow people to buy Bitcoin from a machine, similar to a cash ATM. You feed your C-notes in, and the machine fills up your crypto-wallet. These machines populate large cities.

Be aware that these kiosks are currently under investigation by the IRS. It appears that various shady characters are using Bitcoin ATMs to launder cash. Why take the chance of being the subject of an IRS investigation? Read about Bitcoin ATMs on our site here. The article is titled “IRS Wants to Know Your Bitcoin.”

Using Gift Cards to Buy Bitcoins

The brokerage fee for buying bitcoin with gift cards can be as much as 30%. That means that if you order $100 US dollars of Bitcoin, you only get back $70. The guy on the other end selling the Bitcoin pockets $30. Why screw yourself out of $30? The fees on bitcoin exchanges like Kraken are small.

Plus, you’re dealing with a people-to-people exchange, and those little darlings on these websites may not be angels. The brokerage fees on legitimate bitcoin exchanges are much less. Just don’t do it. It’s another scammer’s paradise.

Go look for yourself. Paxful arranges Bitcoin deals for buyers and sellers. Trust Pilot rates Paxful at 2.3 stars out of five stars. Lots of unhappy campers post their experiences there. Here’s a 2.3 star review of Paxful at Trust Pilot.

P2P Bitcoin Exchanges

P2P bitcoin trading is two people negotiating to sell or buy Bitcoin. P2P bitcoin exchanges are all over the web – hundreds of them. These P2P exchanges are attractive to buyers and sellers seeking anonymity.

You can even set up your own P2P exchange. For example, you run an ad on Craigslist advertising that you want to buy $100 of bitcoin. Sellers answer the ad and offer some fraction of the current Bitcoin price for that $100. The buyer chooses the seller who offers the most Bitcoin for that $100.

The buyer and seller agree to meet next Tuesday at the police station to carry out the transaction. The dollars are exchanged for the Bitcoin and everyone goes home happy. The buyer and seller don’t know each other, so anonymity is achieved.

People-to-people (Peer-to-peer) Bitcoin exchanges were popular when Bitcoin first rolled out. Sellers would post coins for sale on forums and chat boards and buyers would arrange to meet and carry out the transaction.

The P2P bitcoin exchanges offer some measure of anonymity but it comes at price. Normally, the spot price for Bitcoins is established by thousands of traders buying and selling the cryptocurrency throughout the day. P2P exchanges will see sellers adding a fee to insure a profit.

That fee can be excessive. The fee, also called the premium, can be as high as 15%. In other words, the Bitcoin buyer may only receive $85 of Bitcoin for that $100. Fees are much lower at the large, established Bitcoin exchanges.

If P2P bitcoin exchanges appeal to you, check out Bitcoin clubs. Many operate in large cities throughout the world. You’ll be working with people who have been around the bitcoin block a few times and can assist in getting the best deal for your dollars. Click here for a site to find Bitcoin clubs near you.

Ready to Buy Your Bitcoin?

Click on the picture below to start buying Bitcoin. The link will take you to an article on our website that will show you the entire bitcoin buying process at Kraken.

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