How to Buy Cryptocurrency in 2024: Step-by-Step Beginner’s Guide

| Updated on April 29, 2024
beginners guide to buying cryptocurrency

When Bitcoin was first introduced in 2009, it was nothing more than just an intriguing buzzword for millennials and techies. However, futurists already predicted the bright future of cryptocurrency, which now continues to draw millions of investors around the globe. 

Bitcoin is among the most popular digital currencies and people use it interchangeably with cryptocurrency. Today, buying blockchain assets becomes possible through different mediums— whether it’s Bitcoin, Ethereum, or other thousands of coins in the crypto market. 

Purchasing cryptocurrency has become as convenient as investing in the stock market, through different sources such as crypto funds, crypto exchanges and even making investments in the companies directly. 

If you are looking for a reliable platform for investing in crypto, NakitCoins. This platform allows you to safely, swiftly, easily, and privately buy and sell cryptocurrency with cash and to convert your crypto assets into other cryptocurrencies without any limits. In this article, I will give step-by-step guidance for buying cryptocurrency, let’s start!

Step 1: Comprehending Cryptocurrency

Based on blockchain technology, Cryptocurrency is a digital currency that can be used as an alternative payment method or investment option. In the past decade, it has become an influential concept in the financial and technological world. These are decentralized digital assets, operated using cryptography to secure and verify the transactions. 

Plus, it has control over the creation of new entities and functions independently, without any intervention from central banks and governments. These can be used for multiple purposes including storage of value, medium of exchange, and majorly for prospective investment.

Step 2: Which One to Buy?

After the arrival of Bitcoin, thousands of cryptocurrencies launched in the market and many of them also became extinct. So, finding the right investment option in cryptocurrency has become a challenge. 

But, you do not need to worry as I am going to list down the most popular digital currency with higher returns, read further to know more

Bitcoin

Unarguably, Bitcoin is the most popular cryptocurrency even to date. The first Bitcoin was mined on January 3, 2009, and the growth of the coin has seen massive progress since then. In some cases, Bitcoin value fluctuates significantly, however, its application is close to traditional FIAT money.

Ethereum

Ethereum is the second most widely capitalized cryptocurrency after Bitcoin. The application of the Ethereum network is a more advanced form of blockchain technology. 

It enables smart contracts and decentralized applications. These are programmable procedures that can be employed without any need for central authority between parties. 

Altcoins

The term “Altcoins” is used as a collective term for all types of cryptocurrency except Bitcoin. These altcoins are different from one another in their applications. It is advisable to be cautious while trading in these coins.

The below graph represents the popularity of Bitcoin in comparison to other cryptocurrencies.

 Statistics on Bitcoin position among other cryptocurrency

Step 3: Find a Crypto Exchange or a Broker

For buying and selling cryptocurrencies, the most convenient way is via crypto exchange or a broker.

What is a Crypto Exchange

A digital marketplace where buying and selling of cryptocurrencies is known as a crypto exchange. A very nominal amount of fee is charged in exchange for such purposes. The selling price and purchased price are influenced by demand and supply factors. 

These exchanges allow you to trade in a wide range of so-called trading pairs that consist of traditional fiat currencies and crypto such as Euro and Bitcoin. Coinbase, Binance, and Kraken are some of the most well-known crypto exchanges. 

Who is a Crypto Broker?

Crypto brokers act as an intermediary between a buyer and a seller. They have the freedom to determine the price of the currency. Unlike crypto exchanges, brokers charge higher fees in return for an easy and seamless process of cryptocurrency transactions. This makes it the best option for beginners.

Step 4: Make a Trading Account

Now, you have to create a trading account with a crypto exchange or the broker, which only takes up to a few minutes. For account generation, you have to first fill out the form with your details like full name, email, and a setting of password. 

You have to make sure that you create a strong password. Plus, you have to provide your email address as well. After mail confirmation, the KYC process gets started, in which you have to confirm your identity for using financial services. 

It is a necessary legal requirement for financial services providers to prevent money laundering and terrorist financing. Note that buying cryptocurrencies generally requires you to confirm your full name, date of birth, address, and official identity.

Step 5: Make a Deposit

To purchase cryptocurrencies, you need to have fiat money or another cryptocurrency. So, you are required to deposit currency into your trading account before starting trading. The exchange will provide a bank account and payment instructions in case you decide to deposit fiat money like Euros and Dollars. 

Moreover, if you want to deposit cryptocurrencies, then you are required to generate addresses for the corresponding wallet. There is also an option offered by exchanges and brokers for buying cryptocurrencies through credit card, which speed-ups the whole process 

Step 6: Place the Order and Wait

The order determines ways to buy and sell a cryptocurrency. There are different types of order, here are the most important ones.

  • Market order: For buying and selling of cryptocurrency at the marketplace, known as market order. It gets executed immediately and used for quick entry and exit of a position. 
  • Limit Order: A limit order refers to when you want to buy or sell a cryptocurrency at a specific price. So it is useful in case you want to place an order at a lower price.
  • Stop Order: An order that allows one to buy and sell a cryptocurrency at a specific price is known as a stop order. If you are willing to sell at a higher price, this could be the best option.

In addition, the timing of order execution depends on multiple factors. If the cryptocurrency is liquid, then the market order can be executed immediately. In other words, there have to be enough people to buy and sell cryptocurrency. 

Bitcoin is a liquid asset that can be traded thousands of times in a day. Here, market order gets executed immediately and fluctuation of prices can be managed. However, unpopular cryptocurrencies such as altcoin are not liquid as they get traded less number of times in a day. It takes more time to be executed as the prices may have changed dramatically. 

Step 7: Protect and Withdraw your Cryptocurrency

Now that you purchased cryptocurrency, start thinking about keeping it safe. These digital assets are decentralized, so you are solely responsible for monitoring and protecting your crypto holdings. You can use different types of crypto wallets to keep your investments secure. 

However, if you want to transfer your cryptocurrencies to a different exchange, then make sure you have the address of the wallet where you wish to withdraw the cryptocurrencies. Search for the “Withdraw” or “Send” option in the menu item on the exchange, and then confirm the new wallet address. Remember that the wallet address should be correct, as crypto transactions cannot be reversed once initiated.

Step 8: Sell Cryptocurrencies

Lastly, if you want to sell your digital assets, make sure to confirm that the chosen cryptocurrency must be on exchange. Now, decide the order type and conditions on why you want to sell the currency. 

Wait for the completion of the transaction. It is important to note that taxes may be applied when selling or exchanging cryptocurrencies. 

Conclusion

Cryptocurrency has become a popular option for investments among millennials. To trade in digital currency, you should have comprehensive knowledge about the multiple steps involved in completing the transaction. 

In this insight, I gave you step-by-step guidance on how you can buy cryptocurrency as a beginner. Also, there are some alternative options to invest in cryptocurrencies such as crypto trusts, crypto mutual funds, crypto ETFs, and blockchain companies as well. 




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