So you wanna buy some cryptocurrency – here’s five ways to do that

cryptocurrency
A cryptocurrency ATM spotted near the Wan Chai MTR station in Hong Kong, April 2018. Image credit: StreetVJ / Shutterstock.com

We hear a lot about cryptocurrency these days – but we don’t hear nearly as much about how you can go about actually getting your hands on some. For newcomers, it may be difficult to figure out how to buy cryptocurrency. Here we reveal five best options to get cryptocurrency – from digital bank transfers to automatic teller machines that accept cash.

Before starting to buy cryptocurrency, here are the key questions you need to answer first:

Where do you live? Specific methods may not be available in certain states or countries.

What is the fee amount you are ready to pay? Cash deals and ATMs are more expensive.

Would you like to remain anonymous? E-payments require identification.

How secure should the method be? It may vary a lot due to instability.

What payment do you prefer? There are bank cards, e-wallets, cash, etc.

Once you have answered the above questions, you’ll need just two things to buy cryptocurrency: money, and a wallet to store the cryptocurrency.

The money can be fiat or digital, depending on the chosen payment method. Wallets require more careful consideration. Since digital coins obviously exist only in the internet, users store them in specific e-wallets with unique public and private addresses. There are three major types: online wallets, desktop wallets, and hardware wallets.

For relatively small amounts of cryptocurrency, it will be enough to use an online or a desktop wallet. For experienced users with a high volume of trades, hardware wallets are strongly recommended, as no online platform or app can guarantee 100% safety of your funds.

Got it? Now you’re ready to check out the following five methods for buying cryptocurrencies – be sure to keep in mind the above criteria which are essential for your choice.

1. Cryptocurrency exchanges

This option is the most popular right now. There are various websites which can sell cryptocurrency to you. Two major types of exchanges are:

Trading platforms: They are similar to regular stocks-and-bonds markets. Users can place orders for buying or selling cryptocurrencies. The price bounces a lot, fees are pretty low, and tools are various.

Examples

Binance allows for crypto-to-crypto exchanges only. It also offers an option of buying cryptocurrency with their native BNB coin, or USDT (cryptocurrency equivalent for USD). It features the largest number of altcoins for trading.

Kraken is regarded as an altcoin exchange, which enjoys the largest trading volume in EUR. It has around 20 cryptocurrencies listed on the platform and a wide range of fiat currencies to trade against.

CEX.IO is one of the main go-to platforms for GBP markets. Giving an outlook of CEX.IO, it’s worth mentioning that the exchange lists only eight coins for trading, but the killer feature of the platform is the instant buy option.

Brokers: Unlike regular trading platforms, brokers sell only cryptocurrencies. One can’t perform reverse-trading via broker websites. Fees are higher here but the number of payment options is wider.

Examples

Coinmama is favored as an easy way to buy cryptocurrency with a debit or credit card. Though the list of available coins is limited – it includes 8 cryptocurrencies only.

The process of buying Bitcoin via exchange is simple. Normally, you have to register an account and verify it with some private info like ID scans or photos with a bank card. Then it’s enough to place an order. Brokers pay immediately, trading websites may take more time as the fulfilment of the order depends on the market liquidity.

Verdict

Location: available worldwide; some exchanges are national-only.

Fees: 1-7%, depending on the payment option.

Anonymity: low.

Safety: depends on the platform; check reviews and certificates.

Payments: bank cards and transfers; sometimes PayPal, but rarely

2. Peer-to-peer systems

These are also websites, but they differ from exchanges as the system doesn’t control deals. P2P platforms place merchants’ offers which can be accepted by buyers. Frauds are most frequent here, so it’s crucial to trust only verified members with positive reviews. Another drawback of such marketplaces is that they usually work with Bitcoin only. However, high anonymity and various available payment options are characteristic of this type of platforms.

Examples

LocalBitcoins is one of the largest and most popular peer-to-peer platforms for buying and selling Bitcoins. It operates worldwide and allows the user to buy Bitcoin with any national currency.

Paxful is another marketplace for buying and selling Bitcoin. Paxful is known for its wide range of payment methods accepted – over 300 options.

Verdict

Location: fully international.

Fees: system – 0-1%; sellers may charge extra fees.

Anonymity: depends on the seller requirements.

Safety: depends on the seller reputation; check reviews.

Payments: various; from bank deals to cash payments.

3. Cash deals

It’s possible to buy digital currencies with cash, but it’s a bit tricky and unpopular. Firstly, one can make a direct deal with the cryptocurrency owner. That means you meet with a seller, give money, and then the equivalent amount of cryptocurrency is transferred to your wallet. It’s all about confidence and trust. Threats and risks are clear, aren’t they?

Verdict

Location: direct trades possible in all countries.

Fees: 0% for direct trades, generally; depend on the agreed terms and conditions.

Anonymity: high.

Safety: depends on your own protection measures.

Payments: cash only.

4. Stores

Another option to buy cryptocurrencies with cash is specific companies like LibertyX. This US-based brand has 19,000 real stores where people can buy Bitcoins. The process includes verification with mobile phone and ID. Clerks control everything, so it’s quite a reliable option.

Also, there are gift cards and vouchers available. One should pay with cash and then redeem the card to receive coins in the wallet. Safety is arguable because sellers don’t provide any guarantees. Also, fees for gift cards are significantly higher than for online deals.

Verdict

Location: stores are popular in the US.

Fees: up to 10% for vouchers and stores.

Anonymity: high.

Safety: depends on your own protection measures.

Payments: cash only.

5. ATMs

This method is also cash-based. Simply put, there are computer terminals which accept fiat money and allow for buying cryptocurrencies. They are quite rare for now, with only 1,600 locations worldwide (900 of them in the US). ATMs are convenient, as you don’t have to create accounts and wait long for verification. The main drawback is that the exchange rate is significantly higher than that of online platforms.

Verdict

Location: check this map.

Fees: 3-9% and more.

Anonymity: high.

Safety: high.

Payments: cash only.

Written by Julia Beyers, a freelance journalist who covers trends and prospects for the global game industry, as well as blockchain, cryptocurrency trends and the impact of Bitcoin on various other industries

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