Cryptocurrency Buying Guides – How and Where to Buy
Learn about the major cryptocurrencies and how to buy them. Follow the step-by-step guide to buying Bitcoin and learn how to buy Ethereum. Read our versus articles which show you how to compare different coins, their strengths and their value against one another. You can also check out our main guides page for more on exchanges, platforms and crypto wallets.
Coin Buying Guides
How-to Crypto Advice and Step-by-Step Guides
The Different Ways to Buy Cryptocurrency
There are many different ways to buy cryptocurrency. Usually the most practical way is by using a crypto exchange. However there are other methods you could also use. Not all cryptocurrencies are available to buy from using every methods.
List of ways to buy cryptocurrency:
- Trading platform
- Cryptocurrency ATM
- Dedicated crypto card
- Mutual funds
- ETFs and ETNs
- Stocks from companies that are crypto related
Best Cryptocurrency To Invest In
There are thousands upon thousands of cryptocurrencies you can invest in. However you do not know how long most of them are going to last. In fact quite a lot are scams that you would never want to touch. Like for example Squid Game which spiked and never recovered:
Sourced from CoinMarketCap
The Best Cryptocurrencies
On the other hand there are some really good legitimate cryptocurrency projects that are making waves. These projects have good experienced teams behind them. They also have clear and ambitious roadmaps that help guide them. Additionally these roadmaps help give confidence to investors who end up either funding projects or buying the crypto.
The thing is that the cryptocurrency industry is still maturing. Most of these cryptocurrencies are more speculations, even at this point in time. So although a good amount of projects look promising you have no guarantee of where they will end up.
There are a couple of more established projects that people have more confidence and certainty over. To clarify these cryptocurrencies are Bitcoin and the Ethereum platform.
Bitcoin and Ethereum are the best cryptocurrencies to invest in. This is because they have a huge amount of investment into the two projects. Bitcoin and Ethereum are both getting traction with different business investing into them.
Additionally a lot of countries are interested in Bitcoin. Either to legalise it, make it legal tender, include it in their reserves or mine it. This is pretty phenomenal. There are justifiable reasons why. In fact we list them here on why Bitcoin has value.
In Ethereum’s case its DeFi space has really grown and have billions in investment.
So it is fairly safe to say that both projects are highly unlikely to just disappear out of thin air. Moreover more people keep jumping on the band wagon and joining the Bitcoin and Ethereum community.
Disadvantages of Bitcoin and Ethereum
Since Bitcoin and Ethereum are more established they will have less volatility. However that is not to say that they are not volatile. They are still highly volatile, but less so than newer cryptocurrencies. So in fact other cryptocurrencies could give you more profits. However Bitcoin and Ethereum are safer. It just depends on your definition of what is the best crypto to invest in.
The Best Time to Buy Cryptocurrency
There are many people that buy crypto when the price spikes up. They end up getting caught up in all the hype that goes on when that happens. At top of the market you will notice a lot of people thinking they are going to get rick quick.
However usually the price ends up dropping when the hype gets too much. It’s how the market seems to work. Unfortunately it will take time to regain losses when someone bought at the highest price. Timing is crucial when it comes to cashing out your cryptocurrency.
On the other hand, you do not want to get caught up in all of that. Most importantly you do not buy based on emotion. You want to buy when you have a clear mind. After you have had a closer look into things and understand the market better.
Panic buying is driven by anxiety in what is called the fear or missing out (FOMO). It is when someone buys an asset because they fear they are going to miss out on price gains.
Understanding the Cryptocurrency Market
To figure out the best time to buy cryptocurrency you have to know a few of things:
This is the case you want to for example buy crypto every week or every month. If you intend to do this then you do not need to worry about when is the best time to buy. This is because over time the impact of price volatility will average out.
As we mentioned earlier you do not want to buy at the market peak. We have an article that shows you the ways to spot the Bitcoin market peak. You may want to read that.
The Bitcoin halving is a really important moment in the Bitcoin cycle. It is when the amount of Bitcoin that miners get from a block is reduced by half. As a result of principles of supply and demand the Bitcoin price starts to go up. This happens approximately every 4 years.
You can read more about the Bitcoin halving here.
The cryptocurrency market follows Bitcoin. To clarify, whichever direction Bitcoin goes it drags the rest of the crypto market with it. Of course there is altcoin season where altcoins outperform Bitcoin in a bull run.
However if Bitcoin’s general direction is up, altcoins will also go up. If Bitcoin is down altcoins will go down as well.
Some people look to buy deflationary cryptos. This is because they understand the difference between hard money vs easy money. Where hard money is a really positive force. It bring prosperity to any society that uses it because of particular characteristics.
One of these characteristics is that the currency has a supply limit. In other words not like the fiat money we use in society right now. It is why Bitcoiners love Bitcoin so much because it is a cryptocurrency with limited supply.
If we had to adopt a crypto with a limited supply it would be deflationary. Deflation is good because goods and services will go down in price instead of up. As a result the money you have will last longer.
There are several good cryptocurrencies that are deflationary. For example Bitcoin, Ethereum (decreasing supply), Litecoin, Monero and Pirate Chain.
Will Cryptocurrency Replace Money
In one way shape or form cryptocurrency is likely to replace money. We have an article on why is Bitcoin valuable that goes into the details of why Bitcoin is valuable. One of the things it mentions is game theory.
This is like a domino effect where people are influenced by each other. It starts out amongst the population owning crypto. After that it moves up to companies and countries.
For example Bitcoin started out as a collectable that was used among a very small group. At one point the media was saying it is used by drug dealers and money launderers.
However things are changing and Bitcoin is used as legal tender in El Salvador. Additionally Bitcoin is the national currency of Liberland. Things will only progress on to higher levels.
Countries might adopt Bitcoin or perhaps another cryptocurrency. On the other hand some countries are launching central bank digital currencies (CBDCs). CBDCs are inspired by cryptocurrencies. However they are centralised unlike cryptocurrencies.
This means that central banks can create as much CBDCs as they want. As a result they could deflate and inflate the currency as they please. Regardless cryptocurrency in some form is likely to replace money and become the new form of money.
Cryptocurrency vs Stocks
Cryptocurrency is an asset in its own right and is separate from stocks. However at certain points in time crypto is slightly more correlated to stocks. Other times cryptocurrencies are more correlated to gold.
Since cryptocurrencies are a different asset to stocks you might want to have both plus other assets. Especially if you believe in diversification so that not all your eggs are in one basket. Most importantly because otherwise it is risky. Your one asset could take a hit and you have nothing to counterbalance it.
Overall cryptocurrencies have vastly outperformed stocks. Not necessarily all cryptocurrencies however the crypto market in general has done well.
Cryptocurrency vs Stocks Percentage Gains
Let us compare the percentage gains over the last 10 years. Here are the two most well-known cryptocurrencies, the DOW and two of the best performing stocks.
|Ethereum (since 10/2015)||344970%|
One other thing you should know is that cryptocurrencies are not just about cryptocurrency. There are different types of cryptoassets. There are 4 types of cryptoassets you should know about.
- Crypto commodities
- Crypto tokens
- And crypto collectables
They are all different. Additionally you may want to consider diversifying between these different assets.
There are people that are interested in penny cryptocurrency. Penny cryptocurrencies are essentially any cryptocurrencies that are $1 or less. There are many of them, but not all of them are good. Additionally some of the better ones are still speculations at this point.
Here is a small list of suggested penny cryptocurrencies you could research and consider:
- XRP: Large financial institutions are behind XRP. Buy XRP
- Cardano: A well-known and popular project
- Dogecoin: Elon Musk is backing Doge as a payment option
However you do not necessarily have to buy cryptocurrency under a penny. You could always buy Bitcoin or other cryptocurrencies because you can buy a fraction of a Bitcoin.
For example Bitcoin has 8 digitals behind the dot as Bitcoin units. As a result you can buy as little as $10. Albeit it would partly depend on the deposit minimum of the exchange.
Cryptocurrencies are becoming more legitimate as time goes by. They keep growing in popularity. That is to say, not just amongst the populations, but with hedge funds, trading firms and more.
In fact as they become more popular and more legit financial institutions are stepping in. As a result you can expect more cryptocurrency ETFs as additional financial instruments you can buy.
However you should know that there are not that many cryptocurrency ETFs. There are also ETNs which you could consider. ETFs will not necessarily hold a particular crypto. So most likely you will have indirect exposure to the cryptocurrency.
You could find out if a cryptocurrency has an ETF if you check out the buy page of that crypto. Like for example buy Bitcoin which has a short list of ETFs you can buy.
You could also consider buying into cryptocurrency mutual funds. There are a few available and the number will surely grow. However the draw back with mutual funds is that they have a 1-2% yearly fee. To clarify that is whether the fund does well or does not.
The fees is because the funds are actively managed by experienced money managers. However it is quite expensive and it is more worthwhile to just buy the crypto outright.