Some of the most well-known and biggest cryptocurrency exchanges are Coinbase, Gemini, Binance and eToro. While these companies’ standard trading interfaces may overwhelm beginners, particularly those without a background trading stocks, they also offer user-friendly easy purchase options.
The convenience comes at a cost, however, as the beginner-friendly options charge substantially more than it would cost to buy the same crypto via each platform’s standard trading interface. To save on costs, you might aim to learn enough to utilise the standard trading platforms before you make your first crypto purchase – or not long after.
An important note: as someone new to crypto, you’ll want to make sure your exchange or brokerage of choice allows fiat currency (such as sterling and dollar) transfers and purchases made with sterling. Some exchanges only allow you to buy crypto using another crypto, meaning you’d have to find another exchange to buy the tokens your preferred exchange accepts before you could begin trading crypto on that platform. Once you decide on a cryptocurrency broker or exchange, you can sign up to open an account. Depending on the platform and the amount you plan to buy, you may have to verify your identity. This is an essential step to prevent fraud and meet regulatory requirements.
You may not be able to buy or sell cryptocurrency until you complete the verification process. The platform will normally ask you to submit a copy of your driver’s licence or passport, and to upload a selfie to prove your appearance matches the documents you submit.
It is important that as you set up the account and wallets that no one (other than trusted people) are observing the process. There are details that only you should know for the security of your investment.
When buying crypto, you’ll need to make sure you have funds in your account. You might deposit money into your crypto account by linking your bank account or making a payment with a debit or credit card (beware for high charges from your card provider with the credit card option).
While some exchanges or brokers allow you to deposit money from a credit card, doing so is extremely risky – and expensive. Credit card companies process cryptocurrency purchases with credit cards as cash advances. This means they’re subject to higher interest rates than regular purchases, and you’ll also have to pay additional cash advance fees.
Research - do some, it is important to have an idea of what you are going to invest in. Everyone has heard of gold 2.0 or Bitcoin, but there are many other companies that focus on the Metaverse, Dapps, Defi, NFTs, finance... More to come in the next post.
N.B this information does not constitute financial advice - will every form on investment you can lose as well as make profits.
Comments