How to Buy Cryptocurrency

*Transacting in virtual currencies is subject to various risks, such as price volatility, and is therefore not suitable for everyone. Your capital is at risk.


There are several different ways to invest in cryptocurrency. Here are the most common ways for how to invest in cryptocurrency.


Direct Investment

You can directly invest in cryptocurrency, without a middleman. When investing directly, you hold cryptocurrencies in a digital wallet. You must use a specialized cryptocurrency exchange to do this. Some examples of crypto exchanges are:


To invest in cryptocurrency directly, you must understand base coins and altcoins.




Invest in Cryptocurrency Funds and Futures

Aside from investing directly, you can also invest in cryptocurrency funds and futures. Investing in funds and futures reduces the volatility of the investment. When you do this, you do not need to exchange fiat currencies for cryptocurrency. You also will not need to maintain a digital wallet. Investing in crypto funds and futures is like investing in stocks or mutual funds.
The crypto fund available is the Grayscale Bitcoin Trust (GBTC). This fund holds Bitcoin, but it does not track it 1-1. The GBTC is far less volatile than Bitcoin. However, you must pay a 2% management fee for GBTC. This management fee is far higher than the fee for most managed mutual funds.
Another option is Bitcoin Futures. Bitcoin Futures Contract from the Chicago Merchantile Exchange tracks Bitcoin 1-1. This option is ideal for holding futures short-term. However, it is not great for long-term investments since it expires and must be rolled into another contract. You do not need to rely on a cryptocurrency exchange with the BTC, and it s a reliable option with significant liquidity.


Invest in Cryptocurrency Companies

You can also invest in companies involved in cryptocurrencies. They power crypto mining, work to develop their cryptocurrencies, or create platforms that power cryptocurrencies. There are many companies with publicly traded stocks available to invest in. To invest in them, you use a stockbroker to buy shares in the company.

Bitcoin was almost synonymous with the term cryptocurrency. However, that is no longer the case. While Bitcoin is still a top cryptocurrency, there are several other coins available. According to coinmarketcap.com, the top coins to invest in are:



Ultimately, there is not a single cryptocurrency that’s the best. Each currency has unique benefits for different use cases. Many people label Bitcoin as a top option for reserve assets because of its finite supply and widespread adoption.

Small market cap cryptocurrencies are seen as riskier than larger market cap coins.

When choosing a cryptocurrency, evaluate its team. Read the corresponding whitepaper and learn about the way the currency works and its intended use.

Overall, altcoins are on the rise. Some of the most popular DeFi tokens are up 500% in the last 6 months alone. According to market capitalization, the top 5 DeFi token include:

Here are the steps for how to invest in cryptocurrency:


Create a Cryptocurrency Brokerage Account

You need to make an account with a crypto brokerage of your choice. Provide your personal information, much like you would when opening a stock brokerage account. For example, you’ll need to submit your full name, address, date of birth, email address, and Social Security number.


Connect Your Account to Your Bank Account

Once you have a crypto brokerage account, you must fund the account. Connect the brokerage account with your bank account. Most times, you can fund your brokerage account via wire transfers and debit cards. On some platforms, wire transfers are free.


Choose Crypto to Invest In

There ae many different coins you can choose from. You’ll need to pick a crypto to invest in. Right now, Bitcoin and Ethereum are two of the most popular choices. Both of these cryptos offer greater predictability than many smaller altcoins.

While smaller altcoins are more volatile, they also present a greater potential. Small atcoins can grow at astonishing rates, like over 1000% in months. Many crypto investors dedicate a mportion of their investment to smaller atcoins for this reason.


Select an Investment Strategy

You must consider several indicators when purchasing and selling cryptocurrency. New investors may benefit from taking a cryptocurrency trading course. Generally, many investors follow similar strategies as they do for stock trading. Typically, it’s not good to buy at the pinnacle of a bubble nor during a crash.


Store Cryptocurrency

Active crypto traders need to store their currency. Storing your funds ensures you have access to them. You can choose a hot or cold wallet.