It is no secret that the cryptocurrency world of investment is booming at this point and that many investors regularly trade with all kinds of digital currencies. Whether you are interested in trading with Bitcoin, Ethereum, Doge, or any other currency at the beginning, this whole process can seem confusing and overwhelming. Nevertheless, don’t worry getting familiar with the crypto world has never been easier, and it is something that is available to anyone. Let’s see how to buy cryptocurrency for beginners.
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First, You Need to Choose a Crypto Exchange Platform Where You Will Be Trading
In order to buy your first crypto, you need to pick a broker or exchange platform where you will find make a trade. A cryptocurrency platform is an online place where people meet to sell or buy cryptocurrencies. There are numerous platforms you can use. Which one you will pick depends on your needs. Here are some of the most popular exchange platforms:
- Coinbase
- Uphold
- Binance
- Crypto.com
What Is a Cryptocurrency Broker?
Crypto brokers are also platforms that use user-friendly interfaces that interact with a market for you. We could say that brokers are mediators between the market and investors and traders. Another difference between brokers and exchange is that you don’t actually own the asset you are trading with brokers. These platforms are easy to use and are usually commission-free on trading. However, this doesn’t mean they will not charge you some other fees. The most popular brokers are:
- Robinhood
- Webull
- Tradestation
- eToro
Once You Choose Your Platform, You Need to Create an Account
When you decide which platform you want to use, the next step is to open an account. The process is pretty simple, you will have to leave your name, e-mail. Once you open an account, you will have to go through a process of verification. This way platform protects each trader from fraud. You will have to submit some identification documents and take a picture of yourself to confirm your identity.
Depositing Money Is the Next Step
To answer how to buy a cryptocurrency for beginners, you first need to deposit the money you plan to spend on the platform into your account. Naturally, you can not buy anything without money. Depending on the platform you are on, money can be transferred by linking your bank account, credit debit card, or wire transfer. The amount you need to deposit also depends on the platform you are at. Once the transaction is complete, you will be able to make your very first trade.
You Are Ready to Make a Trade
Once you have money in your account, you can make a trade. Most platforms are similar in design and have easy navigation. You have to search for the cryptocurrency you want to buy in the search bar, and the list of coins available will appear. So if you are interested in purchasing some of the most popular coins like Bitcoin(BTC) or Ethereum(ETH), you can also just type their symbols in the search bar. As you may know, one BTC is around $44,000, and buying one whole coin can be difficult, especially for beginners. This is why most of the platforms have an option to purchase a fractional share of the coin. So once you find a coin you wish to buy, click on the button trade. An option to make your bid will appear. Put the amount you wish to purchase then click buy.
Choose Your Storing Option
Crypto exchange is not the same as buying stocks. Crypto doesn’t fall under usual regulations that protect investors from hacking or thefts. For this reason, it is crucial to store your coins in a safe place. There are three options you can choose from:
- Keep your coins on the exchange – If you are trading through a broker, there is a high chance that this will be your only option, but if you are trading through an exchange, you can transfer coins somewhere else. You can also leave the coins on your account, but you will be at risk of losing that money due to hackers attacks. And even though most of these platforms have excellent protections against hacker attacks, you can never be certain.
- Hot wallets – You can open an online wallet that works only when connected to the internet. With these wallets, you can store your crypto online and have access to them through phone, tablets, or computer. And even though wallets are pretty convenient, they don’t offer full protection for your coins.
- Cold wallets – These wallets are not connected to the internet. This is probably the most secure way to hold your crypto. They usually come in the form of external devices you connect to the computer when needed. Usually, these devices are USB or hard drives. The downside is that if you break this device or lose the access codes, you may never be able to get to that crypto again. And even though with hot wallets, you can get locked out the same way (by forgetting the codes), you can contact customer service and maybe get access to the wallet.
Get Familiar With Market Trends
Crypto trading is very similar to stocks and bonds trading. There will be a lot of charts, predictions, and other features you must learn if you want to make smart investments. Most of the platforms have learning tools and a lot of educational content for people interested in crypto trading. So before you start trading, make sure you read as much as you can so you don’t end up losing money. There are demo versions of crypto trading you can try out before you start trading with real money. So try that and get some practical knowledge before you start trading.
