You’d be surprised how easy it is to buy cryptocurrencies like bitcoin (BTC). Before you do, you should note the following:
- Appreciate the importance of DYOR (Do Your Own Research). It’s an acronym you’ll often see in the crypto space—and for good reason! If you solely rely on the advice of others to inform your investment decisions, you may as well throw away your money.
- Plan how you’ll be interacting with the crypto markets. Will it be as an investor or trader? The answer will significantly affect your strategies and tax responsibilities.
- Strongly consider seeking professional advice before buying cryptocurrencies. From country to country, the regulatory status of crypto varies tremendously. This is especially true when it comes to tax, which affects traders and investors differently.
Buy Bitcoin & Other Cryptocurrencies
To buy cryptocurrencies like BTC you need to use an on-ramp. This is just somewhere you go to convert your local currency like Australian dollars (AUD) and U.S. dollars (USD) into cryptocurrency. It’s your ‘ramp’ into the crypto world.
The most popular way to get cryptocurrencies is by signing up to a crypto exchange. These are websites and apps that millions of people use to buy and sell cryptocurrencies.
There are thousands of crypto exchanges out there. Some have customers from all over the world, while others are focussed on a specific country.
You can also buy BTC and other cryptocurrencies through a broker. There are brokers for the crypto world just like there are for the financial world.
A broker is an individual or firm—known as ‘brokerage firms’—that typically charges you a fee or commission for buying and selling cryptocurrency on your behalf.
Generally speaking, brokers can tap into deeper sources of liquidity than exchanges. For that reason, you’d typically use a broker if you’re looking to execute a large buy order. Of course, there are other reasons you may use a crypto broker—one of those being that they save you the time and energy you’d otherwise need to spend using exchanges.
Caleb & Brown is a crypto broker that we have a long relationship with and highly recommend. You can use them if you’re looking to buy more than A$2,500 worth of cryptocurrencies.
Buying Cryptocurrency with Non-AUD Currencies
When buying cryptocurrency on an exchange, you may notice not all local currencies are supported. If you’re unsure how to buy cryptocurrency with your local currency, we’ve prepared the below resources for you.
- Where to Buy Bitcoin & Other Cryptocurrencies With USD—U.S.
- Where to Buy Bitcoin & Other Cryptocurrencies With GBP—UK
- Where to Buy Bitcoin & Other Cryptocurrencies With NZD—New Zealand
- Where to Buy Bitcoin & Other Cryptocurrencies With EUR—Europe
Things to Consider
You’ll generally be able to choose a suitable exchange or broker when you ask yourself these questions:
- How reputable is this crypto exchange or broker?
- What trading and other fees will I get charged?
- What cryptocurrencies can I buy once I’ve deposited?
- Is there enough liquidity to adequately absorb my buy order?
- What are the accepted deposit and withdrawal methods?
- Do they offer any insurance policy?
- Where is this exchange or broker legally based?
- Does this crypto exchange or broker have past security issues?
- Do they quote a competitive local currency exchange rate?
Regarding fees, it’s worth checking how wide on-ramp providers’ spreads are. (Spreads are the gap between the bid and ask prices of a certain cryptocurrency.) Unfortunately, many new crypto investors and traders buy cryptocurrencies through illiquid on-ramps. When this happens, their buy orders can be relatively expensive.
Finding Where to Buy Cryptocurrencies
There are thousands of exchanges you can visit to buy cryptocurrency. This can be overwhelming—especially when you’re looking for where to buy one particular cryptocurrency.
Luckily, there are many websites with useful information about cryptocurrencies, such as where to buy them. Click below for our resource on finding where to buy cryptocurrencies.