How to buy cryptocurrency online

Cryptocurrency is one of the most popular markets around, with millions of coins being traded every day. If you just want help getting started, we can catch you up with the basics.
By: James Knight
James Knight
When he isn’t at work, James is an avid trader and golfer who likes to travel. He once fed, rode, and… read more.
Updated: May 12, 2021
Tip: our preferred broker is, eToro: visit & create account

This is an introductory guide on cryptocurrency and how to get it. You can get to grips with how it all works, why it’s so popular, and some of the top trading platforms.

Compare where to buy cryptocurrency, and open an account

If you just want to find a broker to get coins right away, you can find the top platforms in the table below. We reviewed all the leading options to give you some pointers on how to choose one that suits you. Alternatively, if you aren’t ready to do that yet, read on to learn more about how everything works.

1
Min. Deposit
$50
Exclusive promotion
Our score
10
Accepts customers from the USA
Offers 15 crypto coins to buy&sell including BTC, LTC, ETC, NEO and more
Trade on the world's leading social trading and investing platform
Start Trading
Description:
eToro offers a wide range of cryptos, such as Bitcoin, XRP and others, alongside crypto/fiat and crypto/crypto pairs. eToro users can connect with, learn from, and copy or get copied by other users.
Payment Methods
Wire Transfer, Bank Transfer
Full regulations list:
CySEC, FCA
2
Min. Deposit
$10
Exclusive promotion
Our score
9.3
0% Commission Account
Low Spreads
Eco-Account Option
Start Trading
Description:
CedarFX is an eco-conscious broker offering 0% commission trading on 170+ assets, including Forex, Cryptocurrency Pairs, Stocks, Indices and Commodities. With up to 1:500 leverage, no-fee transactions and low spreads, traders can make the most of their funds. CedarFX also offers an Eco Account option to support tree planting and sustainability projects.
Payment Methods
Bitcoin, Credit Card, Debit Card
Full regulations list:
Please ensure that you fully understand the risks involved, taking into account your investments objectives and level of experience, before trading, and if necessary seek independent advice.
3
Min. Deposit
$60
Exclusive promotion
Our score
8.7
Accessible world wide meaning you can buy cryptos no matter where you are
Save on foreign exchange fees by paying in your local currency with over 47 currencies available
Lowest fees on the market so you can get more crypto while paying less
Start Trading
Description:
UK-based Crypto exchange company with FCA license. Global coverage of 180+ countries and unprecedented 48 US states. Buy & sell cryptocurrencies no matter where you are.
Payment Methods
Credit Card, Debit Card, Skrill, Neteller, Bank Transfer, Bitcoin
Full regulations list:
FCA

What is cryptocurrency?

Cryptocurrency is digital money that can be sent directly to another person without the need for a financial institution. Rather than a bank, cryptocurrencies use digital signatures and online public ledgers (blockchains) to track and verify every transaction. As well as being used to buy and sell goods, cryptocurrencies are also assets that can be traded like stocks and shares.

The first and most popular cryptocurrency is Bitcoin. It was created in 2009 by the pseudonymous Satoshi Nakamoto, who explained the concept in his white paper Bitcoin: A Peer-to-Peer Electronic Cash System. Now, there are hundreds of different cryptos available to buy and sell online.

How does cryptocurrency work?

Cryptocurrency works by using a blockchain to store and verify transactions. A blockchain is like a public database and includes a history of all transactions. Every new transaction is added to the end of the chain and once it’s there, it cannot be changed.

In this way the blockchain is irreversible proof of who owns what. The best way to understand it is to start with how Bitcoin works, but the technology has developed a lot in the decade since that was first established. 

Now there are platforms like Ethereum that use a different, less energy-intensive system to create something more like an alternative internet. Even that technology has been taken a step further, to create whole systems of things like decentralised finance, all of which use a version of ‘the blockchain’ but in a variety of ways.

How to buy crypto online – a step-by-step guide

Step 1. Find an exchange

There are many different types of exchange; centralised and decentralised, ones that accept fiat currency deposits and some that only accept crypto, and ones that stick to the top cryptos while some offer a variety of altcoins. Two of the top exchanges around are:

  • Binance: The most popular crypto exchange around, Binance can handle millions of transactions per second and offers hundreds of different coins. Join Binance today >
  • ChangeNOW: An exchange that supports nearly 200 crypto coins, there are nearly 30,000 pairs that lets you swap one token for another, and the platform is also integrated with other prominent exchanges. Sign up with ChangeNOW >

Step 2. Sign up and fund your account

Before you start buying you need to create an account. You need to provide some contact details to do this and most require a form of photo ID as well. The biggest exchanges, like Binance, let you fund your account with fiat currency, but many only accept deposits in Bitcoin or Ethereum.

Step 3. Purchase

To buy a coin you need to search for its ticker symbol on your chosen exchange. If you were trying to find Bitcoin, for example, you’d search for the BTC symbol and look for the USD/BTC or GBP/BTC pair. Then you can execute your trade.

Many altcoins can only be bought with another cryptocurrency. Again, Bitcoin and Ethereum are usually the best cryptos to use for this, but there are others, like Binance Coin (BNB) and Tether (USDT) that work just as well.

Step 4. (Optional) Get a suitable wallet

A wallet is the most secure place to store cryptocurrency. It’s not a must: you can leave your coins in an exchange account and feel confident they’ll be safe. But the best place to take control of them and add an extra layer of security is a wallet. They come in different forms, from wallet apps to full-blown hardware wallets that store coins offline. 

Take a look at the options to see which one is best for you. Here are a couple of leading wallet providers to start with:

  • CoolWallet: CoolWallet is a hardware wallet that keeps your coins in ‘cold storage’, safe from an internet connection. It also has an app that lets you access your coins via a bluetooth connection. Sign up with CoolWallet >
  • StrongCoin: StrongCoin is a ‘hybrid’ wallet, combining the functionality of an online option with additional security. It stores your private keys on your browser and encrypts it before it’s stored on StrongCoin’s servers. Get StrongCoin now >
1
Min. Deposit
$1
Exclusive promotion
Our score
10
The world's largest cryptocurrency exchange with over 2bn daily users
Innovative trading platform offering enormous range of crypto coins
Supports over 60 methods of payment including PayPal
Start Trading
Payment Methods:
Cryptocurrencies
Full Regulations:

How to trade cryptocurrency – a step-by-step guide

Step 1. Find a broker

Trading crypto means making lots of trades to try to profit from price swings. To do this you want to find a broker that charges low trading fees, so you don’t see your money eaten away by fees. More brokers now offer completely free trading and it can make a big difference to your bottom line.

Brokers are adding crypto trading to their platforms all the time. You probably won’t get as broad a range of coins with a broker compared to an exchange but all the top options like Bitcoin, Ethereum, and Litecoin are usually available. If you’re looking for a broker, here are two of the best options to start with:

  • eToro: eToro was one of the first brokerages to allow CFD trading on cryptocurrencies and has become one of the most popular online brokers around. It also offers assets like stocks and commodities as well as crypto. Join eToro now >
  • Plus500: Another broker leading the charge on CFD trading, Plus500 offers CFDs on many other assets and securities, such as commodities, forex, indices, stocks, and ETFs. Sign up with Plus500 today >

Step 2. Deposit money

You have to fund your broker account with fiat currency. As some brokers charge for deposits and others for withdrawals as well, it’s a good idea to check the fee structure carefully before you start.

Step 3. Decide how you’d like to trade

The most common way of trading cryptocurrency is with CFDs. Generally, if you see people talking about trading regularly, this is what they mean. Rather than buying and holding a coin, CFDs let you speculate on its price without owning it at all. 

Step 4. Start trading 

If you’re new to crypto, the best way to start trading is with a demo account. Virtually every broker offers a variation of this and it’s a way of trading with pretend money to get used to the way everything works. Making your early mistakes with a fake budget is a lot better than putting your own money at risk.

In terms of the trading itself, you have to decide whether you think a coin is going to go up or down in value. If you think it’s going up, then you should buy it – known as taking a ‘long’ position – while if you think it’s going down, you can sell it – known as a ‘short’ position.

As you get more experienced, there are other trading strategies you can use. Another popular option is using leverage, which lets you make bigger trades by only putting up a small portion of the overall value as a deposit. Treat this with caution: losses can escalate just as fast as gains.

1
Min. Deposit
$50
Exclusive promotion
Our score
10
Accepts customers from the USA
Offers 15 crypto coins to buy&sell including BTC, LTC, ETC, NEO and more
Trade on the world's leading social trading and investing platform
Start Trading
Description:
eToro offers a wide range of cryptos, such as Bitcoin, XRP and others, alongside crypto/fiat and crypto/crypto pairs. eToro users can connect with, learn from, and copy or get copied by other users.
Payment Methods
Wire Transfer, Bank Transfer
Full regulations list:
CySEC, FCA

Still undecided?

It’s always a good idea to take your time over something new and cryptocurrency is no different. Below is a quick summary of the pros and cons of investing in crypto, followed by some final questions for you to think about.

Pros

  • There’s the potential for big gains, coins have been known to gain over 100% in value during bull runs
  • It’s becoming more mainstream and established institutions have already started to invest
  • It’s now a realistic alternative to putting your money in a bank or investing it in stocks and shares
  • Some blockchain platforms offer improvements to real-world issues and the widespread introduction of this technology is possible

Cons

Now, here are three more questions to help you decide whether to invest in cryptocurrency.

1. Is it a good time to buy cryptocurrency?

This is a varied question that depends on a few factors, namely; the coin you’re interested in, the state of the overall market, and what your time frame is for seeing returns. Many coins offer benefits for owning them, in the form of interest, dividends, or voting rights, that should also factor into your decision.

The crypto market has been known to experience swings in both directions, and long term investors in particular should keep this in mind. If you’re in it to trade, you can try to predict short term changes using your own indicators regardless, but either way our analysis can help you:

The cryptocurrency market is advancing this Friday, Bitcoin is trading very close to $58000, and for now, everything indicates that the price could advance above this level very soon. Fundamental analysis: Institutional demand continues to grow significantly Bitcoin continues to enjoy the support of both developers and user communities while…
Litecoin (LTC) is enjoying steady bullish momentum, and for now, everything indicates that the price could advance again above $300 resistance. Fundamental analysis: Litecoin could be one of the best performers in the upcoming days The cryptocurrency market is advancing in the first trading days of May, Ethereum went…
Ethereum was one of the best performers on the cryptocurrency market last month, and the price of this cryptocurrency has advanced from $1922 above $2800 in April. The current price stands around $2940, and according to digital assets investment guidance provider Two Prime, Ethereum is still undervalued. Fundamental analysis: The…

2. What problem does cryptocurrency solve, and what are its investment prospects?

Cryptocurrency solves the problem of trusting a third party to act as an intermediary for your money. Instead, every transaction is publicly available and it uses digital signatures along with a blockchain to prove who owns what and prevent double-spending.

It’s difficult to predict the future and some coins are bound to fail, but generally the prospects for cryptocurrency look good. The crypto ‘ecosystem’ has become much more popular in recent years. It has achieved institutional acceptance in many places, with plenty of investment funds already including coins in their portfolios.

One of the challenges is that Bitcoin heavily influences the market as a whole. It generally has the most volume, so it’s very important to know how it’s doing before you invest in anything. Crypto changes fast and tracking the latest news is also crucial to being a successful investor:

Decentralised autonomous organisation BitDAO has secured $230 million (£164.88 million) through a funding round led by PayPal co-founder Peter Thiel. Thiel-founded companies Pantera Capital, Dragonfly Capital, and Founders Fund also invested in the startup. Reportedly, the company used these funds to roll out its DAO, which seeks to foster the…
Huobi, the largest crypto exchange in China, has limited the amount of leverage it offers its users. This move is in response to mounting concerns over the current regulatory policy in China. Reportedly, the exchange also barred new Chinese users from using its platform. Exclusive:…
Mary Barra, the CEO of American vehicle manufacturing company General Motors, has disclosed that nothing is stopping the firm from accepting Bitcoin (BTC/USD). Barra unveiled this news during an interview on June 16, noting that the company is ready to accept payments in the leading cryptocurrency…

3. Do you want to hold cryptocurrency for the long term?

Again it depends on what your goals are. If you research a coin and like its prospects or want to participate in the platform, then you probably do want to hold it for a while. Otherwise, many traders choose to get in and out of positions quickly to try to benefit from price fluctuations. Here are a couple of final points to consider, whatever your chosen time frame.

Considerations for a long term investment strategy

If you’re in it for the long term and only expect the price to go up, find an exchange and buy some coins straight away. Then it can be best to find a wallet to store them, with many platforms offering their own native wallets with unique rewards for investing coins in the success of their work.

Considerations for a short term trading strategy

Short term traders need low fees and flexible trading options. Pick a broker with cheap – or no – trading fees and brush up on how to use tools and charts to predict the market.

James Knight
Financial writer
When he isn’t at work, James is an avid trader and golfer who likes to travel. He once fed, rode, and ate an ostrich all on… read more.