If you are a beginner in the crypto world and figuring out how to buy cryptocurrency like bitcoin, dogecoin, ethereum, cumrocket cryptocurrency or some other. It might be bit confusing for the cryptocurrency beginner but don’t worry you landed exactly at correct place where I will elaborate the said topic in simple words.
Once you understand these steps you can easily start investing in cryptocurrencies. Before we start It’s necessary to understand that cryptocurrency is a highly risky market and you may lose your all money.
So it is advisable to invest only that money which is your extra income winning your family law or you are not dependent of that money for survival. Instead you should invest such money which you utilize for junk foods like burgers, watching movies or unnecessary travelling purpose.
Select a broker or cryptocurrency exchange
To buy your first cryptocurrency first you need a broker or crypto exchange. Before you buy your first cryptocurrency you need few basic things to understand.
What is a cryptocurrency exchange
Currency exchange is a platform where buyers and sellers use to trade there crypto’s. You can use cryptocurrency exchange for low fees but they have a complex interfaces, multiple trade types and advance performance charts, all of which often confuses new crypto beginners.
Binance.US, Gemini, Coinbase are some of the well known cryptocurrency exchanges. Business without having any trading experience may overwhelm. However, they also offer user-friendly purchase options.
Platforms with standard interface are more cheaper then user-friendly options, this shows convenience comes at a cost. An important point for beginners is that you should make sure your brokerage or exchanges allows fiat currency transfer and exchange made with US dollars. You should always use multiple wallets due to availability of different features.
Some exchanges don’t accept dollars instead they only allow users to buy crypto using another crypto. The meaning is very clear you have to find another exchange to buy your preferred crypto token for your first trading.
What is cryptocurrency broker
Currency brokers removes the difficulty for purchasing the crypto. These brokers offers easy to use interface that interacts with exchanges for you. Some brokerage charges higher fees whereas other do not charge any money from you. However, they earn money by selling your information that what you and other traders are buying/selling cryptos on large scale. When it comes to best crypto brokers; Robinhood and SoFi are two best cryptocurrency brokers that are very popular among traders globally.
With brokers you may face some restrictions while moving your cryptocurrency holding of the platform. You cannot transfer your group to holdings out of your account while using Robinhood and SoFi exchanges. For extra security advanced crypto traders prefer to hold their crypto coins in crypto wallets. For more security some crypto investors even choose hardware crypto wallets that are not connected to the internet.
Create and verify crypto account
After deciding the preferable cryptocurrency broker or exchange you can sign up to open a new account. You may have to verify your identity and required kyc/documents depending on the exchange or broker you have picked. It’s an essential step to meet the federal regulatory requirements and avoid fraud.
However, you have opened a new cryptocurrency account but you can only sell or buy cryptocurrency until you complete the verification process. Well might want to know what happens and verification process and to stop your curiosity the platform may ask you to upload a selfie to verify your appearance, it may ask you to submit a copy of your driver’s license or passport.
deposit cash in cryptocurrency exchange to trade
To buy your first crypto make sure your account contains sufficient fund. There are various options to deposit money into your crypto account; you can pay with linking your bank account authorizing wire transfer, pay with debit/card credit. You might have to wait for few days to use the money deposit in your Crypto wallet, depending on your crypto exchange/ broker or your funding method.
Is it safe to buy cryptocurrency via credit cards
Some exchanges allows users to deposit money using their credit cards actually it is very risky and expensive. Let’s understand how! Cryptocurrency purchase with credit card has been processed by credit card companies as cash advance amount. It means they are subject to higher interest rates in comparison to regular purchases. Resulting in you also have to pay additional cash advance fees. While making a cash advance you may have to pay a 5% of the transaction amount. Apart from your crypto-currency brokerage fees this is extra fees that you have to pay and you might lose 10% of your purchase.
Pace your first cryptocurrency order
After putting money in your account now you are ready to purchase your first cryptocurrency. Without any research you may get confused while buying cryptocurrency so it is recommended to research first. There are plenty of cryptocurrencies to choose like Bitcoin, Ethereum, Ripple coin, Dogecoin, Holo etc. You just need to type the name or symbol of cryptocurrency in the search box of your exchange. In order to help you out symbol of some popular cryptocurrencies based on market capitalisation are given below.
Biggest currency symbols
- Bitcoin (BTC)
- Ethereum (ETH)
- Cardana (ADA)
- Dogecoin (DOGE)
- Uniswap (UNI)
- Tether (USDT)
- Binance coin (BNB)
- XRP (XRP)
- USD Coin (USDC)
- Polkadot (DOT)
Cryptocurrency storage options
Federal Deposit Insurance Corp (FDIC) is not responsible to give the backup protection to your cryptocurrencies. More importantly cryptocurrencies are always suffering from the risk of hacking. Crypto users can loose their all investment if they forgets the credentials or codes to access the account. This is already happened and number of crypto investors has lost their millions dollars bitcoin. This is why it becomes more important to have a secure storage for your cryptocurrency.
If you are purchasing your 22 currencies through brokers then you have very little or no options to store your cryptocurrencies. Whereas, if you are purchasing cryptocurrency through crypto exchanges then you have good options to store them as well.
Leave your crypto currencies in exchange – When you buy any cryptocurrency it automatically stored in a crypto wallet attached to the exchange. You can always transfer your cryptocurrencies to hot or cold wallets by paying some fees. The transfer fees depend on your wallet and the size of your transfer.
Cryptocurrency Hot wallets – These are such crypto wallets that are stored online on the internet and you can always access these wallets by using tablets, computers and your phones. However hot wallets are convenient to use but they are always under the circumstances of risk.
Cryptocurrency Cold wallets – Cold crypto wallets are such wallets which are not connected to the internet. Instead they are in the form of external devices like USB device or hard drives. Challenges are everywhere and you have to be careful with cold wallets as well. The reason is if your cold wallet device gets damaged, fails or you lost key codes then you can loose your all crypto Investments.
Big investment companies connected to crypto currencies
Cryptocurrencies are becoming popular day by day and big investment companies are also showing there interest in cryptocurrency trading by allowing people to purchase to confuse from there platform. You can buy cryptocurrency from some of the popular cryptocurrency companies which are given below:
- Nvidia (NVDA)
- Paypal (PYPL)
- Square (SQ).