Feeling the crypto buzz? Trust me you’re not alone. With a crypto-friendly administration and talk about mass adoption, it’s only a matter of time before even the harshest critics start shilling projects on their social media pages.
So, you’ve decided to invest in crypto — now what? How do you buy your first digital asset safely, without falling for scams or making costly mistakes?
In this article, we’ll walk you through a comprehensive yet beginner-friendly guide on buying Bitcoin and other cryptocurrencies. We’ll highlight some of the best and most reliable trading platforms, along with essential best practices to help you secure your new assets.
Let’s jump into the first step!
Step 1: Setup a Crypto Wallet
The first and most important step in purchasing or storing any cryptocurrency is setting up a secure wallet. If you don’t know what a cryptocurrency wallet is, it’s basically a digital container that’s designed to hold crypto tokens.
These wallets come in different types, with each offering different functionalities and varying degrees of security. If you’re looking to purchase a significant amount of crypto (either all at once or over time) and store it securely for the long term, hardware wallets (like the Ledger Nano S and Tangem Card) offer the best and most secure storage solution.
However, if you plan to allocate your funds across a number of tokens, a hot or exchange wallet may provide the ease and flexibility needed to achieve your goal. We’ll dive a little deeper into crypto wallets as we progress in the article, in the meantime explore the web for the best cryptocurrency wallets and find the one that best suits your needs.
Step 2: Choose a trusted, licensed platform/exchange
One of the most common mistakes beginners make when investing in Bitcoin — or any other cryptocurrency — is failing to consider the legal restrictions governing crypto transactions in their region.
If you store recently-purchased cryptocurrency on a platform that is not legally authorized to operate in your country, you risk losing all your coins if the platform ceases operations in your region.
I made this mistake when I first started out and it resulted in me losing some of my coins. So how do you avoid this?
By looking for regulated crypto platforms in your country.
If you live in the US or Canada, below are some trustworthy exchanges that are legally authorized to operate in that region;
• Coinbase
• Kraken
• Bitfinex
• Crypto.com
• Binance US
For people who live outside the United States, exchanges like Kucoin, OKX, Binance.com, Bitget, and Bybit offer high-quality trading services along with a diverse array of advanced features. Just ensure that your country is included in either of these platforms’s lists of supported regions before signing up.
Step 3: Purchase your preferred coins
After selecting an exchange and verifying your account and identity, the next step involves purchasing your favourite coin(s). This can be done directly — through card, PayPal, or bank payments — or indirectly via peer-to-peer marketplaces.
Direct purchases are usually straightforward and can be completed within seconds of initializing the transaction. Using peer-to-peer, or P2P, marketplaces on the other hand can be more complex and may involve adhering to strict protocols.
Things to consider when purchasing cryptocurrencies on a P2P marketplace
• Only trade on reputable platforms with a significant number of good reviews online. As a general rule of thumb, it’s best to stick to P2P marketplaces on crypto exchanges.
• Ensure that the platform you’re using has an escrow service and never confirm your end of the transaction until you can verify that the other person has completed theirs.
If the coin you want to purchase isn’t available for direct exchange on your preferred platform’s P2P marketplace, you can buy USDT from a marketplace merchant and then convert it to your desired coin through a Spot trade.
On the mobile apps of exchanges like Binance, ByBit, KuCoin, and Bitget, simply go to the ‘Trade‘ tab at the bottom of your screen, then select ‘Spot‘ at the top once the page loads.
Next, click on the ticker symbol, and on the next screen, search for the name of the coin you want to buy.
Once you find the coin you’ve been looking for, click on it and enter how much in USDT you’d like to spend. But before you do that make sure you change the “Limit” option just under “Buy” and “Sell” to “Market”.
Your newly-purchased coins should be added to your assets under “Trading”.
Step 4: Move your coins to a non-custodial wallet
Earlier in this guide, we discussed the importance of setting up a secure crypto wallet. In this section, we’ll dive a little deeper into the different classes of wallets and discuss their benefits.
Let’s start with a quick refresher on non-custodial wallets and some of the risks they carry. A non-custodial wallet is one where the individual manages both the private and public keys.
Unlike custodial wallets, which are provided by third parties like crypto exchanges to store customers’ assets, non-custodial wallets give users full control over their crypto holdings. However, this also means that the responsibility for securing these assets rests entirely with the individual.
Due to the vulnerability of crypto exchanges to hacks, non-custodial wallets are generally considered as a safer storage alternative to custodial wallets. Examples include software wallets such as Trust Wallet and MetaMask as well as offline wallets like Tangem Cards & the Ledger Flex.
If you bought a significant amount of Bitcoin or cryptocurrencies, it’s always a good idea to move those coins to a non-custodial wallet. However, if you have a small portfolio spread across multiple tokens, the most practical option would be to temporarily store the coins on the exchange as transferring them may incur significant fees.
Step 5: Keep your wallet details safe
Hackers and malicious actors are always devising new strategies to steal crypto. Even if you opt for a non-custodial wallet and manage your private keys, hackers can still gain access to your holdings using phishing attacks.
That’s why it’s important that users never reveal their keys to anyone on the internet, even those claiming to help you.
Anyone who gains access to your private keys can control your assets.
I have read way too many stories on Reddit and Twitter about newbies losing their coins to scammers. I don’t want yours to be the next. That’s why I included this section.