Where Can You Buy Cryptocurrency?
The world of cryptocurrency is growing fast… but it’s still pretty new. So, while getting in early can be great for your wallet, getting started takes several steps. You'll need a cryptocurrency exchange account, a cryptocurrency wallet, and some idea of which cryptocurrency you want to buy. You'll also need a good internet connection and the funds to buy your currency. Once you have all of those things, where can you go to buy cryptocurrency?
There are several websites where people can buy and sell cryptocurrency. However, for places that allow buying, selling, and withdrawals, you essentially have two options: cryptocurrency exchanges and local banks. Let's take a look at both.
A cryptocurrency exchange is an online platform that allows people to buy and sell cryptocurrency. You can find many types of cryptocurrency exchanges coming from all over the world. In these places, cryptocurrencies are exchanged for other cryptocurrencies, or government-backed currencies, such as US dollars.
Because there are so many exchanges, you'll need to take some time to figure out which one will work best for you. First, decide whether you want to use a centralized or decentralized platform. Both types of platforms come with pros and cons. For example, you may find more users on a centralized platform, which means that trading may become a lot simpler. With a decentralized platform, however, you may find fewer security risks.
You can also narrow your choices based on the type of cryptocurrency you want to buy. Some cryptocurrency exchange platforms only work with one or two types of cryptocurrency, so it's important to choose a platform that sells the currency you want.
Generally speaking, the pros and cons of both types of exchanges are...
- Allows you to use regular currency to buy crypto
- Beginner-friendly and easier to use
- Usually well-regulated
- Greater liquidity
- Less secure compared to decentralized exchanges
- You have to open an account and provide sensitive data to be compliant with regulations
- Some centralized exchanges might manipulate data, like trading volume and price manipulation
- Safe, secure, and reliable
- All trading is usually completely anonymous
- Lower trading fees
- Control over your funds
- Most decentralized exchanges are made for experienced traders and aren’t easy to use for beginners
- Regular (Fiat) currencies usually aren’t accepted on decentralized platforms, meaning they are only for crypto-to-crypto trading
- Less popular decentralized platforms might struggle with liquidity
Another option is to find a local bank that deals with cryptocurrency. Until very recently, centralized banks wanted nothing to do with cryptocurrency exchanges. However, many banks have started seeing the value in cryptocurrency, and they now offer cryptocurrency options to their clients as a result.
Unlike other forms of cryptocurrency, bank-sponsored cryptocurrencies are backed by fiat money. This means that you may get a more stable investment when you buy digital currency through a bank. Plus, you get all of the other benefits that come from banking locally, including helping the local economy.
Which is the Safest Bet?
All investments come with risk, but between banks and cryptocurrency exchanges, the safer option is generally a bank. Banks can also be more beginner-friendly than cryptocurrency exchanges. While there's no reason you can't dabble in both choices, beginners should probably start with a local bank. You might expand your options as you gain more experience, but local banks provide some great places to start.