Step-by-Step Guide to Purchase Bitcoin Using Paytm

Although you can buy BTC using Paytm in any P2P crypto exchange, the payment process across all platforms is similar. So I’ve chosen LocalBitcoins as an example to guide you through the trade process.  

If this is your first time buying bitcoin with Paytm, don’t worry – I got you covered! Just follow the step-by-step instructions on how to make your first purchase. 

Step 1: Register your account with LocalBitcoins 

Head over to LocalBitcoins and register your account through your email. Once you register, go to Settings > Security and enable the two-factor authentication (2FA). This adds an extra layer of security to your LocalBitcoins account. 

Your LocalBitcoins account comes with a free secure bitcoin wallet where you can store your bitcoins. 

Note: If you don’t have an authenticator app, you can install Microsoft Authenticator or Google Authenticator on your mobile device.

Step 2: Select payment method as Paytm 

Navigate to the main page (or click the Buy bitcoins menu). You’ll see a Quick Buy option on your screen. Select Paytm from the “All online offers” dropdown and click Search. 

This will list all bitcoin traders in India who accept Paytm as a payment option. 

Note: Make sure the location is India, as the payment dropdown lists options based on the country. 

Step 3: Pick a trusted seller 

You need to choose a trader with a good reputation and high amounts of trades. Here’s where you need to pay close attention. 

The user profile in the below screenshot has made over 3000 confirmed trades with a 100% feedback user from peers – which is great! You can also see the selling price per bitcoin and the minimum and maximum trade limits on the advertisement listing. 

To know more about the user, you can click on the username. Take the time to go through multiple seller profiles before deciding on a candidate. 

Note: Take a look at the seller’s previous feedback and trading history. Check whether the seller’s real name has been verified by other buyers. 

Step 4: Send trade request 

Once you pick a potential trader, click the Buy button. Here you’ll see more information about the advertisement. 

Enter the INR amount you wish to purchase bitcoins. And, pay close attention to the Terms of trade section, as this varies from user to user. For example, some sellers might request you to provide your Paytm-registered mobile number in the comment section for additional verification.

You can input your comments based on the instructions in the terms of trade. Click the Accept terms and send trade request button – this will notify the seller. 

Note: If you don’t agree to the terms mentioned by the user, you can go back to the advertisement listings page and choose another user. 

Step 5: Pay the seller 

As soon as you initiate the trade, LocalBitcoins will hold the seller’s bitcoins in escrow for 60 minutes. The escrow is a method to safeguard the buyer from scams. This means, even if the seller doesn’t release the bitcoins, LocalBitcoins support can release them to you. So, you don’t have to worry about the seller running away with your money. 

Transfer the amount to the seller’s Paytm number. 

Note: If you have any doubts or need more information on the payment process, you can send a message to the seller. 

Step 6: Confirm your payment status 

Once you’ve made the payment to the seller’s Paytm number, include the reference number and attach the screenshot of the payment confirmation. Then click the I have paid button. 

When the seller verifies the receipt of your payment, their bitcoins will be moved from escrow to your LocalBitcoins wallet. 

Note: You should mark the payment complete within 60 minutes, else the trade will cancel automatically. 

Although your trade is complete at this point, there’s still one more step: to provide feedback to the seller. This is important as the reputation system helps the community to filter trustworthy trading partners. 

Verification Level  

Almost all crypto trading platforms follow a verification system to comply with legal requirements and to prevent money-laundering and terrorist funding activities. 

LocalBitcoins has verification levels from T0–T3 based on the user’s level of activity on the platform. This increases the overall trust of the users and ensures a safe trading environment for all parties. 

You can receive bitcoins in your LocalBitcoin wallet, only if you have a T1 verification level. This level is to verify your identity. 

To complete T1 verification, go to Settings > Verification and click on Proceed to the next level button. To verify your identity, you need to upload original images of your ID proof. This process is quite easy and fast. You will also be asked to take a selfie for cross verification. 

Note: Check the supported identity verification documents for India.  

Things to Consider When Buying Bitcoin Using Paytm

Here are a few things you’ll have to keep in mind when buying bitcoin using Paytm.

Finding a trading partner 

Before choosing your trading partner (seller or buyer), do your research on the user profiles. Look through their completed transactions, verification details and feedback. This will give you an overview of the trader’s reputation. 

Bitcoin price 

Paytm offers a quick and easy way to buy bitcoins. But, this convenience comes with a price. The traders in P2P platforms who offer Paytm as a payment option typically charge 5–10% above Bitcoin market price. So if you are planning to trade regularly, you should consider other buying options like bank transfer and debit card which are more economical. 

Storing your Bitcoin 

While it’s safe to store your bitcoins in your LocalBitcoins wallet, it is recommended to move your bitcoin (or any other cryptocurrency) from web wallets to more safe private wallets. Storing your bitcoins in your mobile, desktop or hardware wallets, gives you complete control over your bitcoins. 

If you need any clarifications regarding the buying process, go through LocalBitcoins’ FAQ section.  

How to Transfer Bitcoin to Paytm

You can also cash out (sell) your bitcoins to your Paytm wallet. Similar to the buying process, this bitcoin transaction is not a direct BTC to INR conversion. 

When selling bitcoins, you’re essentially transferring your bitcoins to a buyer’s LocalBitcoins wallet, who will then transfer the agreed INR to your Paytm wallet. 

To sell bitcoins using Paytm, you have to navigate to the Quick Sell page and choose Paytm from the payment method dropdown. Then, select a trusted advertisement from the listing and open a trade. 

Once you click on the Accept terms and send trade request button, your bitcoins will be moved to the escrow. Release your bitcoins once you receive the buyer’s payment in your Paytm wallet. 

And that’s all there is to buying and selling bitcoins using Paytm!