How do Exchange Exchanges Work?
Bureaus are essentially the intermediaries who play the role of converting from one currency (euro, dollar, etc.) to another (bitcoin, Litecoin, etc). The way operation is quite simple to them. First we need to create an account on an exchange. Once we've done that, we'll get instructions on how to send money to it via banks (SEPA or SWIFT although the former is by far more economical). The money we send will be credited to our exchange account and we will be able to use it to buy bitcoins. The bitcoins we bought, we can then send to our wallet.
If we have bitcoins and we want to convert them into euros, we send our bitcoins to the exchange and they are credited to our account. Then we can sell them to receive euros, which will be credited to our account at the exchange. Then we can request the transfer of the euro in our account to the exchange office to our bank account.
What should we take care of?
First of all, we should bear in mind that banking transactions above a threshold are controlled. If we produce bitcoins and choose to liquidate them at a bureaus and therefore there is a constant flow of money from a bank abroad to ours, we will be asked to explain the origin of the money.
Banking, from our bank to the exchange and vice versa, is not immediate and can take many days. It is also good to avoid banking transactions that are not SEPA, since they are highly charged.
Due to the recent settings, most bureaus now identify the user to follow the instructions KYC and AML. In order to remove some trading limits or, in some cases, to make transactions to and from the exchange, we will have to send a copy of our ID or passport to us in electronic form. Some bureaus also ask for a copy of a utility bill, which is also in our name. Finally, we will have to send money from a bank account in our name to the exchange, but also in order to be able to receive money in the account we will declare, it should also be in our name. Otherwise, the money may be blocked.
Where do I find the bureaus?
The most common bureaus where you can buy and sell bitcoins are:
- Mt.Gox - Supports multiple coins
- Bitcoin Central - Supports transactions to and from the euro. To use the service it is necessary to send the required supporting documents such as a copy of identity card, a copy of a second identification document, a bank document where your bank account will appear and proof of permanent residence.
- Bitcoin.de – Shopping and sales directly between users, with transaction security. The seller sends the bitcoins they want to sell to the service. Once he receives payment from the buyer, he posts it to system and then the coins are sent to the buyer. 1% transaction fee, split equally between buyer and seller. Supports Liberty Reserve and Banking transactions.
- BitStamp - Collapsible transaction charges with a maximum of 0,5% for a monthly trading volume of less than 500 dollars and a minimum of 0,2% for a monthly transaction volume greater than 150 of thousands of dollars. SEPA transfers are charged 0,9 € per order with a minimum order amount of 10 dollars.
A complete list of all Bitcoin bureaus can be found here.
What other ways are there?
A very useful service also to get Bitcoins is and GetBitcoin, through which you can find the fastest "road", depending on what you have (from Linden Dollars, up to coupons and Moneygram). Finally, for transactions with cash, you can also use the LocalBitcoins.
