Cryptocurrencies can be bought from exchanges, friends, family, colleagues, strangers, locally or globally, with cash or via third-party cryptocurrency trading apps. Before purchasing cryptocurrency, it is crucial to determine which type you would like to buy from the various options available. It is also vital you observe prices and exchange rates to decide on when to buy. This article will provide a guide on where to buy cryptocurrencies, how to research before a buy and methods for making the actual purchases.
Considerations to make before buying cryptocurrencies.
- Type of currency to buy. Although the most common cryptocurrencies available on the market today are Bitcoin and Ethereum. Numerous others are coming up, and they include Litecoin, Cardano, Ripple, Dash, and Monero. The more common the type of digital currency, the more accessible it is. Some types of cryptocurrencies are challenging to find or purchase.
- Transaction costs. If buying from an exchange, there is usually an exchange fee that ranges between 0.2% to 3%. However, most people overlook deposit and withdrawal fees that are charged on the exchange which can significantly impact the net buy price.
- The legitimacy of the Cryptocurrency. While most cryptocurrencies in the market are legit, there have been cases of some that close down without paying their users. It is essential to do your due diligence on the type of digital currency you are considering before making a purchase.
- Purpose of buying. If you intend to purchase with a long-term view to build a portfolio, investing in more than one cryptocurrency would be your ideal approach. On the other hand, if your aim is to sell when the value of the currency appreciates to a certain level, you should be more interested in price charts and in the short-term horizon.
- The value of cryptocurrencies fluctuates from time to time. Sometimes the price hits new highs while at other times, it takes an unexpected dip. You should consider which phase a currency is going through and and how this fits with your own preference. Some people prefer purchasing when the price is at a low, believing the price will not fall much further and so that when the value appreciates, they make a significant profit. Others prefer to buy when price is at a high as this could signal that the asset is on an upward trend and may go much higher.
Where to buy cryptocurrencies
- ATMs and Kiosks. Numerous cryptocurrency ATMs and kiosks are emerging across the globe. These cryptocurrency trading outlets accept fiat currency of the user’s country in exchange for cryptocurrency value. Buyers can find information on such stores by doing an online search for cryptocurrency ATM maps and listings to identify a store nearest to them. The listings and map should provide details of the location of the shop, trading hours and trading rates.
- Person to person. One can buy cryptocurrencies from another person either friends, family, or strangers. The transaction can be made face to face or via an app. If dealing with strangers, it is critical to transacting in public places. For apps, buyers should remain vigilant of phishing sites that maliciously acquire individual’s personal information.
- Exchanges are digital marketplaces where users can buy and sell cryptocurrencies using authorized currencies. Online exchanges act as intermediaries between buyers and sellers. They can be centralized or decentralized.
Payment Methods for buying bitcoins
- Cryptocurrency wallet. Wallet providers allow users to buy directly from their wallets at a fixed rate. Some Cryptocurrency wallet providers include Blockchain.info and Xapo. This method of payment requires a user to link their bank out to their cryptocurrency wallet. Although it is a fast means of making a trade, it puts the user’s privacy at risk due to the link to their bank account. Cryptocurrency wallets are available in the form of apps, websites, and software programs.
- Credit cards. Initially, it was perceived a risk for buyers to use their credit cards to buy cryptocurrency. Nowadays, use of credit cards to purchase cryptocurrencies is becoming increasingly popular.
- Bank transfer. Cryptocurrency exchanges allow buyers to make bank transfers into their exchange account to purchase digital currency. If buying from another person, buyers can agree with the seller to be able to make a bank transfer.
- Cash can be used transact among peers or at cryptocurrency ATMS.
- Some individuals may be reluctant to accept payment through payment in avoidance of cumbersome dispute resolution procedures of the service provider.
Actual process of buying
The primary process of buying bitcoins is simple. You determine the type of cryptocurrency you want to purchase and identify either an exchange, ATM, or person to buy from. You use your preferred and the seller’s acceptable method of payment to transfer currency to the seller. The seller then transfers bitcoins to your cryptocurrency wallet or exchange account.
Buying cryptocurrencies is not complicated. With a basic understanding of the factors in play, methods of purchasing, and avenues of purchasing, you can begin to get great value from investing in cryptocurrencies.