Introduction to Buying Cryptocurrency
How do you get started with buying cryptocurrencies? Pandacoin’s Crypto Crash Course shows you different methods of how to buy bitcoin and why it’s required to buy other cryptocurrencies.
Some of you might be thinking “Alright, I understand mining and such but what if I just want to buy some cryptocurrency and invest that way?” In the past, the first step has been to purchase bitcoin. In order to purchase bitcoin with dollars or whatever your nation’s currency is, you have a couple of choices. The first choice is to attach a bank account to a crypto currency exchange like Vault of Satoshi, Cryptsy or Moolah, and purchase bitcoin by trading your dollars or Euros, etc, for bitcoin, at which point you can use the exchange to trade for any other coin you wish to own.
This, however, is often times thought of as overly intrusive and difficult, as it requires many forms of verification including valid ID, etc. Usually, this is not ideal. You might also find a way to purchase locally, buying an individual’s paper wallet in exchange for cash. A paper wallet is essentially a barcode that, when scanned, gives you access to the coins. This, however, might be difficult or undesirable, as it requires you to travel and meet in person with the individual with whom you want to purchase the paper wallet from, unless you find someone selling paper wallets online.
You might also find communities of various coins where you may be able to find people who are selling their coins, from whom you can purchase those coins. If they are willing to accept pay pal or some other form of online transaction, this is often the simplest way. Unfortunately, this method is rife with people who want to scam others out of their coins, and thus is often untrustworthy. In this case, people usually want what is called an escrow, which is an impartial, trusted third party that acts as the middle-man in the exchange. That individual would usually be a very active and highly trustworthy member of a community that has already completed thousands of dollars worth of trades for others, or a service provided by an established company or exchange.
The final, and easiest method of purchasing coins, is from a site that accepts paypal, and pays you the coin you want directly. Currently the only 2 sites that fit this description are BuyPND.com and weselldoges.com, which are sites that accept paypal payments and instantly pay you Pandacoins or Dogecoins. The only unfortunate bit about sites like this is that they usually require a 10-20% markup in order to make a profit, cover for charge-back scams, and stay online.
Now, let us say that you purchases bitcoin, or Dogecoin, but what you really wanted was a different coin entirely. What you would do, is find an exchange that trades in the coin you want, such as Mintpal or Cryptsy, and you would make an account there. You then create a wallet for the coin you currently have, let’s say dogecoin, and deposit it from your personal wallet, to the online wallet. You then trade dogecoin for bitcoin, and then trade bitcoin for whatever the coin is that you actually want. Fortunately, transaction fees are small (usually 0.15%), so multiple transactions aren’t so bad. One important thing to note, is many exchanges have bitcoin and litecoin markets. Sometimes a coin is cheaper to buy with bitcoins than it is to buy with litcoins, or visa versa. Take this into consideration before you make a trade, or you could be losing money.