How to Buy Cryptocurrency

Want to learn how to buy Bitcoin, Ethereum, Litecoin, or another popular cryptocurrency? Then this guide is for you. We’ll cover everything you need to know about how to buy cryptocurrency and show you how to get started today.

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Buy Cryptocurrency in 3 Steps

You can buy cryptocurrency in just 3 simple steps. Here’s how to get started:

Step 1: Sign up for eToro. eToro is our top-rated crypto exchange because of its low fees and wide selection of digital currencies. Register at eToro.com to open a new exchange account.

Step 2: Deposit funds. Fund your eToro account with a credit card, debit card, PayPal, or bank transfer. You can deposit as little as $50 when you open a new account.

Step 3: Buy Cryptocurrency. Select the cryptocurrency you want to buy and click ‘Trade.’ Enter the amount you want to purchase in dollars, then click ‘Open Trade’ to buy crypto with eToro.

That’s it! You now own cryptocurrency that you can trade or use for payments around the globe.

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What is Cryptocurrency?

Cryptocurrency is a type of digital currency. Unlike traditional currencies, cryptocurrencies aren’t controlled and managed by any national government. Rather, they use a decentralized structure in which everyone can see transactions in real-time and verify that they’re accurate.

Cryptocurrency relies on a relatively new technology known as blockchain. You can think of the blockchain like a digital ledger. Every time a cryptocurrency is sent or received, the transaction is recorded to the blockchain for everyone to see. Blockchain technology is considered one of the most secure digital technologies currently available.

What are the Most Popular Cryptocurrencies?

There are thousands of different cryptocurrencies, so how do you know which ones to buy? To start, you can narrow down your selection to just a few of the most popular cryptocurrencies.

Here’s a short list of the most widely traded digital currencies:

  • Bitcoin
  • Ethereum
  • Tether
  • Cardano
  • Litecoin
  • Stellar
  • Dogecoin
  • Shiba Inu
  • Chainlink
  • Bitcoin Cash
  • Ripple
  • Solana

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Ways to Buy Cryptocurrency

There are several different ways to buy cryptocurrency. We’ll explain what they are and the advantages and disadvantages of each.

Cryptocurrency Exchanges

Cryptocurrency exchanges offer the simplest and cheapest way to buy cryptocurrency. With a cryptocurrency exchange, you can deposit US dollars and buy whatever digital currency you want. The process is pretty similar to buying shares of stock through an online stockbroker.

Popular cryptocurrency exchanges include eToro, Coinbase, Binance, Kraken, and Gemini.

Cryptocurrency exchanges charge competitive fees and most have a wide range of cryptocurrencies to choose from. Many also offer trading tools like charts and news feeds to cater to people who want to buy and sell cryptocurrencies for a profit.

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Alternative Platforms

A number of alternative financial platforms now offer the ability to buy cryptocurrency. These aren’t cryptocurrency exchanges per se, although they work similarly. PayPal, Robinhood, and WeBull are some popular examples of platforms in this category.

These platforms are convenient because many people already have accounts with them. So, buying cryptocurrency doesn’t take much work. However, these alternative crypto trading platforms typically charge higher transaction fees and they may have only a limited selection of cryptocurrencies available to buy and sell.

Bitcoin ATMs

One additional way to buy cryptocurrency is by using a Bitcoin ATM. These are physical ATMs that you can find in most cities. Instead of dispensing cash, you deposit cash into the ATM and the machine will send cryptocurrency to a wallet of your choice. Of course, this means you must already have a crypto wallet —more on that below.

Bitcoin ATMs can be a good option if you want to buy cryptocurrency with cash, but they’re not recommended if you are using a credit or debit card. That’s because these ATMs can charge up to 10 times as much as a cryptocurrency exchange when you buy cryptocurrency. They also typically only dispense Bitcoin and cannot be used to buy other digital currencies.

How Do You Store Cryptocurrency?

After you buy cryptocurrency, you need a way to store it and keep it safe. There are 2 different options available to you: custodial accounts and crypto wallets.

Custodial Accounts

A custodial account is a digital account you have at an exchange. With this type of account, your cryptocurrency is held on the exchange’s servers and it’s available to you whenever you need it. However, since the exchange can access your crypto, these accounts aren’t considered to be fully secure.

Crypto Wallets

Crypto wallets are digital accounts for storing your crypto that live on your smartphone, your computer, or even an offline hard drive. Only you have the passcode needed to de-encrypt your crypto wallet, meaning that it’s very difficult for anyone to hack in and steal your coins. Crypto wallets are the gold standard for storing cryptocurrency and should be used if you have a significant investment in crypto.

Buy Cryptocurrency with eToro: An in-depth review

If you want to buy cryptocurrency today, we recommend using eToro. eToro is our #1-rated cryptocurrency exchange in 2022 for several reasons.

First, eToro offers some of the lowest fees we’ve seen from any major cryptocurrency exchange. You’ll pay a fixed 0.75% fee when you buy Bitcoin and nothing when you sell. For most cryptocurrencies other than Bitcoin, the fee at eToro is 1.9% when you buy and there’s no fee when you sell. eToro currently offers trading on more than 40 of the most popular cryptocurrencies. 

At most other cryptocurrency exchanges, transaction fees start at 1.5% and you’ll be hit with the same fee when you cash out.

Another thing that stands out about eToro is that it offers tons of tools for cryptocurrency trading. You get access to advanced technical charts with dozens of built-in indicators. The platform also has in-depth analysis from market experts and a news feed to help you stay on top of the latest crypto news. eToro even offers a built-in social network, enabling you to connect with other cryptocurrency owners.

eToro makes it easy to store your cryptocurrency by offering both an exchange account and a free crypto wallet called eToro Money. eToro Money is available for iOS and Android, and it connects with your eToro account so you can instantly swap currencies in your wallet.

The exchange also makes it simple to convert dollars to Bitcoin or another crypto. You can fund your account with Visa and Mastercard credit and debit cards, as well as with a bank transfer or PayPal. You only need $50 to get started and you can buy as little as $50 in crypto at a time.

It’s worth noting that eToro does charge a $5 withdrawal fee when you go to cash out your account. However, this fee is small when you think about how much eToro’s low transaction fees can save you in the long run.

Pros:

  • Very low fixed fees for buying cryptocurrency
  • Excellent charting and trading tools
  • Social network to connect with other crypto buyers
  • Accepts credit, debit cards, and PayPal with no deposit fees
  • Free crypto wallet for iOS and Android

Cons:

  • $5 withdrawal fee

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How Much Does It Cost to Buy Cryptocurrency?

The cost of buying cryptocurrency varies based on what method you use to buy cryptocurrency and what coin you’re buying. If you use an exchange like eToro, you’ll typically pay a percentage of your total transaction. This is as little as 0.75% when you buy Bitcoin at eToro or 1.9% when you buy Ethereum or another cryptocurrency.

Other exchanges charge higher fees. For example, Coinbase charges a flat commission that ranges from $0.99-$2.99 depending on how much cryptocurrency you’re buying. On top of that, the exchange charges a fee that ranges from 1.49%-3.99% depending on whether you fund your purchase with a bank account or debit card. You’ll pay these fees both when you buy cryptocurrency and when you sell it.

Buy Cryptocurrency Today

Ready to buy cryptocurrency today? Get started with eToro to access more than 40 popular cryptocurrencies! eToro offers some of the lowest fees of any cryptocurrency exchange and has a free crypto wallet to help you safeguard your coins.

FAQs

What is the best cryptocurrency to buy?

For beginners, we think Bitcoin is the best cryptocurrency to buy. It’s the most popular cryptocurrency in the world and is widely accepted for payments. Bitcoin’s price is also more stable than that of most other cryptocurrencies.

Do I need a Bitcoin wallet to buy cryptocurrency?

You don’t need a crypto wallet to buy cryptocurrency. Most exchanges, including eToro, offer custodial accounts that let you store your coins on the exchange’s servers. You can access your cryptocurrency at any time, just like you could with a wallet.

Can I buy cryptocurrency with cash?

You can buy cryptocurrency with cash using a Bitcoin ATM. Alternatively, some cryptocurrency exchanges have partnered with retailers to enable cash deposits.

What is the best site to buy cryptocurrency?

We think eToro is the best site to buy cryptocurrency online today. eToro offers some of the lowest exchange fees we’ve seen and has a selection of more than 40 popular cryptocurrencies. You can get started with as little as $50.
 

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