Cryptocurrency has become one of the most popular forms of investment in recent years. Whether youve heard about it from a friend or have been following the growing trend of digital assets, many beginners are eager to get started with crypto trading. However, it can be overwhelming at first because of the vast number of options and unfamiliar terms involved. If you’re looking to enter the world of cryptocurrency but aren’t sure where to start, this guide may help.
In this article, we will walk you through everything you need to know about buying cryptocurrency, from choosing a platform to making your first purchase.
Before diving into buying cryptocurrencies, it’s essential to understand what they are. Cryptocurrencies are digital or virtual currencies that use cryptography for security. The most popular cryptocurrency is Bitcoin, but there are thousands of others, including Ethereum, Litecoin, and Ripple. These digital assets are typically decentralized and operate on a technology called blockchain, which ensures secure and transparent transactions.
Understanding how cryptocurrencies work can help you make better decisions when it comes to buying and investing in them. You may want to start by researching the most popular coins and their use cases.
Key takeaways
Knowing how to buy crypto starts with knowing which asset you want to buy or invest in. Many beginner cryptocurrency investors start with established options like Bitcoin or Ethereum.
The crypto broker or exchange you use to invest is just as important as the asset itself. Make sure the platform is user-friendly, transparent, and trustworthy.
To buy crypto, fund your account with cash. Then, you can start buying full or fractional cryptos of your choosing.
Avoid buying crypto with a credit card at all costs. It’s risky and expensive, and ultimately not worth the leap.
Take stock of what you’re trading, who you’re trading with, and who you’re listening to for crypto trading guidance. All of this and more can contribute to a safer crypto-buying experience.
How to invest in cryptocurrencies?
Buying cryptocurrency may seem complex at first, but it’s a straightforward process once you understand the steps. Here’s a quick guide to help you get started:
#1. Research which crypto you want to buy
Before making any purchase, it’s essential to research and decide which cryptocurrency you want to invest in. While there are thousands of options, beginners often start with well-known cryptocurrencies like Bitcoin (BTC) and Ethereum (ETH). Here’s how you can go about your research:
Track performance: Look at the historical performance of the cryptocurrency. This will help you understand its volatility and price trends over time.
Understand the blockchain: Every cryptocurrency is powered by a blockchain, which is the technology that supports it. You should research how secure and scalable the underlying blockchain is, as it can affect the asset’s long-term viability.
Community and team: Investigate who is behind the cryptocurrency. Established projects usually have reputable teams, and a strong community can signal trustworthiness. Research the founders, any partnerships, and the project’s long-term goals.
If you decide to explore altcoins (alternative coins), due diligence becomes even more critical. Altcoins are often less stable and more risky than Bitcoin or Ethereum.
When youre ready to buy crypto, the platform you choose to trade on plays a significant role. For beginners, it’s often easier to use a broker rather than an exchange, as brokers typically offer a more user-friendly experience.
Here’s what to consider when choosing a platform:
Ease of use: Look for platforms that are intuitive and easy to navigate. As a beginner, you’ll want a platform that doesnt overwhelm you with too many options. Public.com offers a beginner-friendly interface, making it easier to explore and invest in popular cryptocurrencies like Bitcoin, Ethereum, Solana, Dogecoin, Avalanche, and more alongside other assets like stocks, ETFs, and Bonds.
Transparency: The platform should be transparent about its fees and security measures. Always check if the broker provides detailed information about how they secure your investments.
Security: Ensure that the platform has solid security measures like two-factor authentication (2FA) to protect your investments from hacks and theft.
External wallet compatibility: Some brokers allow you to transfer your crypto to an external wallet for extra security. While this might not be a top priority for beginners, its worth considering.
#3. Fund your account
Once you’ve chosen your broker or exchange, the next step is to fund your account. Youll need to deposit cash into your account, which can typically be done via:
Bank transfer: Most platforms allow direct bank transfers.
Debit card: Many brokers accept debit card payments for funding accounts.
Wire transfer: You can also use wire transfers for larger deposits.
It’s important to note that your first deposit may take some time to process, but subsequent deposits should be quicker. Once your account is funded, you’re ready to make your purchase.
#4: Make your first purchase
After funding your account, the next step is to buy cryptocurrency. Here’s how it works:
Search for the cryptocurrency: Most platforms let you search for a specific cryptocurrency by name or symbol (e.g., Bitcoin = BTC, Ethereum = ETH).
Place the order: Select the amount you want to buy, and then place the order. You can purchase full coins or fractional amounts, depending on the platforms offering.
Once the order is placed, the cryptocurrency will be available in your broker account. From there, you can choose to hold, sell, or purchase more coins as you see fit.
How much to invest in cryptocurrency?
Investing in cryptocurrency requires a careful approach due to its high volatility and risk. Here are some tips to help you decide how much to invest:
Start small: Experts usually recommend starting with a small portion of your portfolio, such as 1-2%, especially if youre new to cryptocurrency.
Only invest what you can afford to lose: Given the unpredictable nature of crypto, avoid investing money you might need for essential expenses.
Consider your financial goals: Assess whether cryptocurrency aligns with your long-term investment strategy.
Diversify your portfolio: Don’t put all your funds into crypto. Balance your investments across other assets like stocks, bonds, and ETFs.
Evaluate your risk tolerance: If you’re uncomfortable with sharp price swings, limit your exposure to crypto.
Ultimately, the amount you invest should depend on your financial situation, goals, and ability to handle risks. Start cautiously and adjust as you gain more experience.
How to buy cryptocurrencies on Public.com?
Buying cryptocurrency on Public.com is a simple process, perfect for beginners and experienced investors alike. By combining crypto investing with other asset classes, Public.com provides a convenient way to diversify your portfolio and manage all your assets in one place.
1. Sign up for a crypto account on Public
You can sign up for an account on our website or download the Public app from the App Store (iOS) or Google Play Store (Android).
2. Add funds to your Public account
There are multiple ways to fund your Public account – from linking a bank account to making a deposit with a debit card or wire transfer.
3. Choose how much you’d like to invest in cryptocurrency
Navigate to the Explore page. Then, search for the cryptocurrency of your choice (e.g., Bitcoin, Ethereum) in the search bar. When you see the cryptocurrency appear in the results, tap it to open up the purchase screen.
4. Manage your investments in one place
You can find your newly purchased cryptocurrency in your portfolio – alongside the rest of your stocks, bonds, options, ETFs, and IRAs.
Bottom line
Now that you understand the basics of how to buy cryptocurrency, you may be on your way to becoming a crypto investor. It’s not as complicated as it may seem as long as you take your time, research thoroughly, and choose a trustworthy platform. With a little cash, some due diligence, and the right tools, you can enter the world of crypto and start building your portfolio. Just remember, the crypto market can be volatile, so always invest wisely!
Yes, but it’s risky. Credit card purchases often include cash advance fees (up to 5%) and high-interest rates if not paid off immediately. It’s safer to fund investments via bank transfers or debit cards to avoid extra costs.
Can you buy fractional crypto?
Yes, many brokers allow fractional crypto investing. You can start with as little as $1, making it easier to invest in high-priced coins like Bitcoin.
Do I need a wallet to buy cryptocurrency?
Not necessarily. Many brokers allow you to store your crypto directly on their platform. However, for extra security, you can transfer your assets to an external wallet.
Can I start investing in crypto with a small amount?
Yes, most platforms, including Public.com, allow fractional investing. You can start with as little as $1, making it easy to begin without a large upfront investment.
How long does it take to fund a crypto account?
With Public.com, you can get started and invest in cryptocurrencies within 5 minutes.
What’s the safest way to store cryptocurrency?
Hardware wallets or cold wallets are considered the safest as they are offline and less susceptible to hacks.
