Buy cryptocurrencies: Step-by-step guide
Buying cryptocurrencies is a potentially (very) profitable investment activity, but unfortunately not all beginners know how to get the best results.
In fact, to be precise, many beginners not only fail to make money from buying cryptocurrencies, but even lose it. Some are outright scammed, others make obvious (and easily avoidable) mistakes.
It's a shame, because buying cryptocurrencies can generate very high returns , as demonstrated by the stories of many investors (often beginners) who have achieved spectacular results. You just have to know how to do it.
In this guide, we explain in detail how to buy cryptocurrencies without getting scammed. It's not difficult , but there are some key aspects to keep in mind (often ignored by beginners).
We also present the best platforms to buy cryptocurrencies. We have only chosen platforms that are serious and safe (there are still many scams) and easy to use even for beginners.
How to buy cryptocurrenciesWe start our guide by talking about the most common mistake made by beginners who want to invest in cryptocurrencies.
It is a mistake due to ignorance, which can cost them dearly both in terms of losses and lost profits. Beginners think that the only way to make money with cryptocurrencies is to buy them, wait for the price to rise, and then sell them.
This strategy obviously works, but keep in mind that cryptocurrencies are an especially volatile financial asset. This means that the price can rise, but it can also fall quite sharply.
The best platforms to invest in cryptocurrencies offer two fundamental operations:
- Buy cryptocurrencies to earn when the price rises;
- Sell short cryptocurrencies to profit when the price falls;
Thanks to short selling, it is possible to make money even when the price of cryptocurrencies drops.
Thanks to this operation, it does not matter how the cryptocurrency market goes, whether we are in a boom phase like in 2017 or in a (strong) decline phase like in 2018. You always make money, as long as you make correct predictions ( and not it is difficult to do them).
Of course, not all platforms for buying cryptocurrencies also allow you to short sell them: that is why it is important to choose very carefully which platform to operate with. We will discuss it in more detail in the next section.
The best platforms to buy cryptocurrenciesIn the list above, we have included the best platforms to buy cryptocurrencies (or short sell them). We have carefully selected the safest and most reliable platforms that are easy to use even for beginners.
Some of these platforms offer truly spectacular support tools and free courses.
Let's take a look at the comments in detail.
eToroeToro is considered one of the best platforms to buy or sell cryptocurrencies. It is safe and reliable, easy to use even for those starting from scratch.
The main advantage of eToro is the ability to copy what other investors do on the platform.
Thanks to innovative Copytrading software , it is possible to find investors who have achieved good returns in the past with minimal risk. These investors can be selected to be copied: the eToro software will do it all, copying trade by trade in real time.
Beginners who start buying cryptocurrencies with eToro get the same results from day one as other more experienced investors, selected based on past performance, and can even learn (if they want) simply by watching the best live trades.
eToro allows you to use several tools to make the deposit, so for example you can buy cryptocurrencies with Paypal, credit card, bank transfer, etc.
XTBXTB is the other great opportunity for beginners who want to start buying cryptocurrencies without mistakes.
The platform is really simple and intuitive, even for those starting from scratch. Furthermore, all members are assisted by phone by a real cryptocurrency expert who provides precise instructions.
If you want to learn, you can download for free one of the best courses to invest in cryptocurrencies. It is a course that has had spectacular success, with hundreds of thousands of downloads.
What is this success due to? It is a free course, while other courses have a fairly high price. Plus, it's an easy course to study, even for beginners. Finally, it is a practical course: in the end what people are interested in is making money with cryptocurrencies, not studying the theory.
However, the advantages of XTB are not over: all members can use a free demo platform that allows you to buy and sell cryptocurrencies with a simulation. This makes learning faster and easier and you can start seriously with a good experience behind you (this makes a difference).
XTB also allows you to buy cryptocurrencies with Paypal, bank transfer, credit card and other payment instruments.
Iq OptionIq Option is a platform for buying cryptocurrencies especially appreciated by beginners for two fundamental reasons: it is very easy to use and allows you to start investing with only 10 dollars (other platforms require about 250 dollars).
If you are just starting out, you will find a very complete learning area on the official Iq Option website. These valuable resources are available free of charge to all members.
Iq Option also offers a free and unlimited demo with no obligation.
Cryptocurrencies and scamsSo far we have presented the best safe platforms to buy cryptocurrencies.
Why are these platforms considered so safe and reliable? Because they are authorized and regulated platforms, which means that they are obliged to comply with strict European regulations that protect investors. The competent authorities monitor compliance with these standards.
We make this clarification because in recent years the number of scams related to cryptocurrencies has been really high .
There are people who think that Bitcoin is a scam because the number of scams is really high.
Why so many scams?Simple: people already know that you can make money with cryptocurrencies, but they don't know how. Scammers take advantage of this by presenting opportunities to make easy money for a small investment.
Many people fall for this because the message is plausible : as we have said, investing in cryptocurrencies can be very profitable. What unsuspecting victims don't know is that to get the desired results, you have to use safe and reliable platforms, and only regulated platforms are.
Below is a list of cryptocurrency-based scams that you should stay away from:
- Bitcoin Trader
- Immediate Edge
- Bitcoin Evolution
- Bitcoin Revolution
- Bitcoin Profit
Buy cryptocurrencies with PaypalIs it possible to buy cryptocurrencies with Paypal? Yes, in two ways. For US residents, you can purchase cryptocurrencies directly from the Paypal app.
Obviously you have to pay heavy commissions (Paypal is always very expensive) and you cannot use leverage or make short sales.
The other, more comfortable option is to use the best cryptocurrency platforms that accept Paypal among other payment methods.
Buy cryptocurrencies at a bankPrecisely to avoid scams, there are people who want to buy cryptocurrencies in banks. Unfortunately (or fortunately) this is not possible.
On the contrary, cryptocurrencies, at least at first, were born in opposition to the banking system , which was considered expensive, inefficient and not very transparent. Over the years, this revolutionary charge of cryptocurrencies has faded and they are now considered an investment class like any other.
Buying cryptocurrencies in a bank (especially in LATAM) is not possible. Some Asian banks have started operating with Ripple, but our banking system is far behind.
In any case, there are no problems. The authorized and regulated platforms we have presented in this article offer exactly the same guarantees that a bank could offer and are easy to use.
Buy cryptocurrencies without commissionsFurthermore, we have only selected platforms that allow you to buy cryptocurrencies without commissions.
If one day Argentine banks allowed people to buy cryptocurrencies, they would have to pay high commissions.
Paying commissions is never a good business and operating with intermediaries who charge them (or have other costs, fixed or variable) is a very painful mistake, typical of beginners.
So how do the cryptocurrency platforms we've featured here make profits?
They apply a small differential, that is, a minimum difference between the price at which you can buy cryptocurrencies and the price at which you can sell them (a much more advantageous system for the investor).
Buy cryptocurrencies on the exchangesMany beginners think that the only way to buy cryptocurrencies is through exchanges. We confess that we don't like cryptocurrency exchanges at all and, in fact, we haven't mentioned them yet.
Why so much distrust? There are basically two problems with exchanges:
- Lack of reliability
- High commissions
For this reason, smart investors avoid stock markets . But there is also the issue of commissions: all exchanges charge high commissions, sometimes double.
In practice, many exchanges do not allow you to buy smaller cryptocurrencies directly with euros. First you have to go through Bitcoin. In this way, you have to make a double purchase and, therefore, pay double commission (and they earn double).
For the sake of completeness, let's mention two of the most popular cryptocurrency exchanges: Bitstamp, Kraken, and Coinbase .
What cryptocurrencies to buySo far, we've talked pretty generically about buying cryptocurrencies. But what are the cryptocurrencies to buy? Let's do a brief summary of the main cryptocurrencies you can invest in today.
Buy BTC (Bitcoin)Bitcoin is the most famous cryptocurrency and was also the first to be created . Basically, it all started with Bitcoin and even today, Bitcoin has a greater total capitalization than any other.
Buy EthereumEthereum is the second largest cryptocurrency. It was born on the wave of Bitcoin's success and has improved it considerably. Among the main advantages of Ethereum are smart contracts , which can be programmed to manage transactions automatically.
Buy RippleRipple is one of the most capitalized and most traded cryptocurrencies for investment purposes . It is characterized by being the only cryptocurrency that already has a practical purpose: it allows international transactions between financial entities to be carried out cheaply and quickly (much faster than Swift, with enormously lower costs).
Buy TronTron is a decentralized platform based on the blockchain that aims to build a free, global entertainment system of digital content with distributed storage technology, and that allows digital content to be shared easily and economically.
Buy DashLaunched in 2014, Dash was originally known as Darkcoin and was designed to ensure user privacy and anonymity. In fact, the cryptocurrency white paper, created by Evan Duffield and Daniel Díaz, describes it as “the first privacy-focused cryptocurrency” based on the work of Satoshi Nakamoto.
Approfondisci: I will buy Dash.
Litecoin CoinMeasured by market capitalization (or the amount of currency on the market), Litecoin is the third largest cryptocurrency after Bitcoin and XRP. Litecoin, like its contemporaries, functions in some ways as an online payment system . Like PayPal or a bank's online network, users can use it to transfer currency between themselves.
Cardano Coin (ADA)Cardano is a decentralized, blockchain-based system powered by the ADA coin, the cryptocurrency that runs on the Cardano platform. Like Ethereum, it is a smart contract-based system and can be used to run decentralized applications (called DApps). But Cardano is a multi-tier system, i.e.
Stellar CoinStellar is an open source, decentralized payment protocol that enables fast cross-border transactions between any currency pair. Like other cryptocurrencies, it works on blockchain technology. Its native asset, a digital currency, is called lumen (XLM). XLM powers the stellar network and all its transactions, similar to how ether (ETH) powers the Ethereum network.
Approfondisci: I will buy Stellar
EOS CoinEOS is a cryptocurrency designed to support large-scale applications. Sending or receiving EOS has no cost . Instead, the protocol rewards entities that operate the network periodically with new EOS, effectively substituting inflation for transaction fees.
Approfondisci: I will buy EOS
Binance Coin (BNB)Binance coin is a digital currency issued by the Binance exchange . The cryptocurrency is denoted by the symbol BNB. Binance Coin is used by users to pay the fees that Binance trading charges for using the services. These fees include, but are not limited to, trading fees, exchange fees, and listing fees.
Tezos CoinTezos (XTZ) is a blockchain network connected to a digital token, which is called tez or tezzie. Tezos is not based on complexion mining. Instead, token holders receive a reward for participating in the proof-of-transaction consent mechanism.
After a promising start and a highly successful initial coin offering (ICO), Tezos suffered numerous delays and legal issues. However, Tezos has survived , in part due to its unique proof-of-stake mechanism. The price of tezos more than tripled between October 2019 and February 2020 and reached record levels.
Applications to buy cryptocurrenciesIf you want to buy cryptocurrencies from your smartphone or tablet, you can trust several safe and verified applications.
The first step to install secure software on your device is to download only the applications available in official stores (Play Store and App Store for Android and iOS respectively).
While in the case of the iPhone we know very well that applications have to pass a strict security test, in the case of the Play Store we recommend that you read user reviews carefully, to be safe from malware or scam attempts that may compromise the security of your data.
We have analyzed the app reviews of the cryptocurrency buying platforms that we presented at the beginning of our guide.
The result is more than positive: eToro, XTB, Capex and IQ Option offer their users a free application of the highest level.
We are talking about extremely stable and responsive mobile platforms (as well as secure), which allow you to use all the tools available on the desktop without any problems . Cryptocurrency price updates occur in real time and transactions are immediate.
Additionally, the apps are lightweight and highly compatible with most smartphones. Even if you have never activated an account on one of these platforms, you can carry out the entire procedure directly from your mobile phone, in a simple and intuitive way.
Demo mode can also be activated on smartphones and tablets, without limits or restrictions.
Don't take unnecessary risks: try applications to buy cryptocurrencies from the safest platforms on the market.
When to buy cryptocurrenciesWhat is the time to buy cryptocurrencies and what is the time to short them? In other words, how is it possible to make accurate cryptocurrency predictions?
First of all, let's say that those who copy the best with eToro can also avoid making predictions : they will buy when the best investors buy and sell when they sell.
And the others? There are two systems to make accurate predictions, technical analysis and fundamental analysis.
Technical analysis is based on observing cryptocurrency price charts. Based on past results, reliable predictions can be made about future results.
Fundamental analysis , on the other hand, is based on news, positive or negative, related to cryptocurrencies. If there is positive news, the price rises. If there is negative news, go down.
It should also be mentioned that the price of alternative cryptocurrencies is usually linked to Bitcoin. When Bitcoin goes up, other cryptocurrencies go up. And when Bitcoin goes down, the others go down.
ConclusionsIn this article we have presented the best tools and techniques to buy cryptocurrencies.
Buying cryptocurrencies is a suitable activity even for beginners, but you have to be very careful with scams and mistakes. For this reason, we have also presented in this article the best platforms (easy to use and commission-free) to buy cryptocurrencies: