Buying cryptocurrencies may be a confusing process, especially if you’re a beginner. You don’t know where to start, where to buy, what to buy, and the best way to buy. Moreover, with so many options now available in the market, it may be pretty challenging to find which will suit you best.
Over the last few months, the process of buying and selling digital currencies has been made less complicated. Buying cryptocurrencies can now be broken down into three easy steps, and here’s how you can start voyaging into the cryptocurrency world.
Whether you already have a coin in mind or still thinking about it, researching which coin you should buy should be given some of your time.
Surely, it is tempting to buy coins that are currently on hype but don’t just ride on and use your money just because others are doing it. Some coins on hype in the market may appear to be a good investment, but once you thoroughly research its functionality and ideology, you will see it’s not worth putting your hard-earned money into.
You could do your research on Google, but aside from it, CoinMarketCap and CoinGecko are also good places to start. These platforms list down all available cryptocurrencies, as well as information regarding those.
STEP 1: Get A Wallet
A cryptocurrency wallet is an application intended to keep and retrieve an individual’s digital assets, keeping it all in one place.
Crypto wallets could be applications just like those you run on computers and smartphones, the aforementioned type of wallets is called “software wallets.” It could also be in the form of a physical device that runs a wallet application, called a “hardware wallet,” providing you a tactile experience.
In terms of security and usability, hardware wallets have an edge compared to software wallets. However, it may cost you a few bucks to buy one, while software wallets can be accessed for free.
You need to consider certain things in choosing a cryptocurrency wallet—software or hardware— which include company reputation, technologies used, crypto conversion, platform, and other essential aspects. And most important of all, check if the wallet supports the cryptocurrency you have in mind. What’s the sense of having a wallet if you can’t store your crypto in it, right?
After getting your wallet, you need to locate your cryptocurrency address which you will use for receiving payments. Cryptocurrency address will be essential for the next step.
Each crypto coin has its own address format.
STEP 2: Buy Coins
In order to buy Bitcoin, or other coins or tokens, you need to look for an exchange that, of course, has the coin you want.
Exchanges are similar to currency exchange shops that you could find at an airport. The only difference is, instead of exchanging currencies of different countries, you can exchange your local money for cryptocurrencies.
This is the easiest means to buy a cryptocurrency— moreover, it can be done even from your smartphone!
It is rare to find all market-listed coins in exchange, so you need to find an exchange with your desired coin/s. Keep in mind to only use popularly considered exchanges as there are a lot of fake exchanges currently.
Disclaimer: The exchanges that will be mentioned are from thorough researched and are not sponsored.
Here are some popular exchanges to buy cryptocurrencies from:
Coinbase
This exchange stands as the most popular and biggest crypto broker exchange, accepting credit/debit, bank transfer, and PayPal as payment methods. The fees are based on the method you choose for payment, so make sure to check which asks for the least pay. The card fees are the highest, about 3.75%.
There are restrictions on Africa, Asia, and South America, so you can’t probably access Coinbase in those areas. Coinbase is primarily available in Australia, Europe, and North America.
Bitcoin, Bitcoin Cash, Ether, and Litecoin are available on Coinbase.
Bitstamp
Bitstamp was among the oldest crypto exchanges worldwide. There is a greater number of cryptocurrencies listed on Bitstamp compared to Coinbase. However, this may not be suitable for beginners because of its complicated features that newbies might find confusing.
The exchange accepts credit/debit with USD and EUR and bank transfer. However, you should expect high fees when you buy using a credit card.
The charge for using a debit card is about 2% if you deposit an amount bigger than $1,000 and $10 if you put down less than $1,000.
Famous cryptocurrencies like Ether, Bitcoin, Bitcoin Cash, Ripple, and Litecoin are available on Bitstamp.
Kriptomat
This exchange might have opened its doors recently in 2018, but it has shown great potential. Kriptomat’s primary operation hub is located in Slovenia, but the actual company is in Estonia, a legal framework for cryptocurrencies like licenses for Crypto Wallets and Exchanges.
Kriptomat set its eyes on providing the safest fiat gateway in the crypto space, acquiring operating licenses by the Estonian Anti-Money Laundering Authority.
Other exchanges require a vigorous process in verifying identities, but this was made simple on Kriptomat, taking only 5 minutes of your precious time to upload all required documents. Some countries even allow doing this process through mobile.
Kriptomat braces 21 languages and provides reliable customer support. The buy/sell fees are about 1.45% without requiring any fees to send or withdraw cryptos.
You can find Bitcoin and Ether on Kriptomat.
These are just some reliable exchanges you can start with. You can do your own research before deciding which one will suit you best. The location, availability of cryptocurrencies, and security are the most critical factors you should consider in choosing one.
What You Should Know Before Buying
Before finally clicking the “buy” button at your end, you should keep these five important things in mind.
Take Your Time
You can’t just tell yourself, “I want to invest in cryptocurrencies!” and then do so on a whim. Knowledge is an important weapon, and one cannot win a fight without it, so you should invest in knowledge.
Take time to study cryptocurrencies, their goal, purpose, ideology, and price fluctuations to make wise decisions in buying one.
List Down Your Goals
How much do you desire to invest each month in cryptocurrencies? Are you going for a short-term or long-term crypto investment? Determine all your goals while sitting down, sipping your favorite beverage, and thinking through why you want to invest in cryptocurrencies.
Invest Intelligently
If you want to buy cryptocurrencies through credit or loan, you might end up having tons of debts in case something goes wrong in your investment. Cryptocurrencies are profoundly volatile and are highly risky. So, not investing an amount you cannot afford to lose is a golden rule in buying cryptocurrencies.
Diversify
One of the financial lessons Monopoly teaches is diversification. Victory changes become higher once you spread out your properties all throughout the board.
The same goes for cryptocurrencies.
In case one of the cryptocurrencies you put your money into faces a terrible situation, you will have an alternative investment that will redeem that one drop.
Financial Fitness
Lastly, before buying a cryptocurrency, you should consider the status of your finances. Do you have enough savings that could cover three to six months’ worth of expenses? Do you have debts to pay off?
It doesn’t make any sense to invest if you haven’t paid off all your loans and credit cards balances.
