Cryptocurrency is all the rage in tech and finance circles these days. Skeptics and supporters go back and forth constantly on the merits of cryptos like bitcoin, but if you’re reading this you’ve probably already decided to get into the market.
If you don’t own any cryptos yet, making your first purchase can seem confusing. There are many different coins at different prices, and you may have heard from friends how complex but rewarding owning crypto may be. With a little help though, entering the wild world of digital currency can be a gentle experience.
Before you actually buy anything, you have a few decisions to make. First, set aside exactly how much money you’re willing to spend. As a rule of thumb, you should never pony up more money than you’re willing to lose. Crypto markets can fall dramatically in short periods of time, so it may be tough to stomach your account fluctuate like that.
Next, decide which coin or coins you’re interested in owning. There are thousands of cryptos, but only five major ones with market caps greater than $5 billion: bitcoin, ethereum, ripple, litecoin, and bitcoin cash. You should spend some time researching any coins you’re considering buying.
See also: Bitcoin vs Ethereum
Lastly, choose where you want to buy and store your coins. There are a number of platforms that allow you to buy and sell cryptos, but Coinbase is the best for beginners. Coinbase is simple, intuitive, and processes transactions quickly making it ideal for people getting into crypto. Coinbase is very secure as well, but there are better options if safety is your main concern.
How To Buy Cryptocurrency on Coinbase
Before you can start trading on Coinbase you’ll need to create an account and link a payment method. Registering only requires your name, email, and state of residence, while you can link your bank or credit card to purchase coins.
Once you’ve signed up, you’re free to start buying. Coinbase offers support for 15 cryptos, including the five largest mentioned above. You can buy whole coins, or more likely for something like bitcoin, fractions of coins. The process is really easy: it takes a few clicks to buy any amount of any coin you like. Coinbase also offers a referral program: if you get a friend to sign up and spend $100, you both get $10 of bitcoin.
After you’ve made purchases, Coinbase shows you your portfolio’s value over time as well as a pie chart of each coin you’ve invested in. There’s also a Coinbase mobile app that gives you access to your crypto on the go and allows you to set custom price notifications.
Selling your coins is just as simple. It takes a few clicks and an overview of the transaction and you can swap your coins for cash.
Read about micro-investing and how to get started with our complete guide: Micro-Investing: What It Is, Why It’s for You and How to Start.
Other Platforms to Buy Cryptocurrency
Coinbase is far from the only platform to buy cryptocurrency, and if you want to invest in smaller coins you’ll need to use other services. Kraken is the second most prominent crypto exchange and offers smaller altcoins like EOS and Ripple.
Kraken is not quite as easy to use or navigate as Coinbase, but it offers many of the same features. I’d recommend it for people with experience trading cryptos, as it may be a bit confusing for beginners.
Like Coinbase, your first steps on Kraken involve creating an account and verifying your personal and financial information. Unlike Coinbase, you’ll need to deposit money into your Kraken account before you can buy any coins. From there, buying and selling becomes relatively straightforward if you’ve mastered Kraken’s complex layout.