How To Buy Bitcoin, Dogecoin, Or Other Cryptocurrencies

While you can buy some cryptocurrencies, like Bitcoin, with US dollars, other cryptocurrencies, like Ethereum, demand that you pay with bitcoins or another cryptocurrency. You will require a “wallet,” or an internet app that can store your money, in order to purchase cryptocurrencies.

Typically, after opening an account on an exchange, actual money can be transferred in order to purchase cryptocurrencies like Bitcoin or Ethereum.

You can build a wallet on Coinbase and buy and sell Bitcoin and other cryptocurrencies in addition to using it to trade other cryptocurrencies.

Additionally, an increasing number of online brokers, like eToro, Tradestation, and Sofi Active Investing, provide cryptocurrency.

Free cryptocurrency transactions are available through Robinhood.

The best cryptocurrency exchanges accept a range of payment methods and are safe, affordable, quick to set up, and simple to use.

Here are our top recommendations for where to get bitcoin.

Best Places to Buy Bitcoin in 2021

Are cryptocurrencies a good investment?

Cryptocurrencies may go up in value, but many investors see them as mere speculations, not real investments. The reason? Just like real currencies, cryptocurrencies generate no cash flow, so for you to profit, someone has to pay more for the currency than you did.

That’s what’s called “the greater fool” theory of investment. Contrast that to a well-managed business, which increases its value over time by growing the profitability and cash flow of the operation.

  • to participate in its earnings (you’re an owner), while buying tokens simply means you’re entitled to use them, like chips in a casino.
  • Is the currency already developed, or is the company looking to raise money to develop it? The further along the product, the less risky it is.

It can take a lot of work to comb through a prospectus; the more detail it has, the better your chances it’s legitimate. But even legitimacy doesn’t mean the currency will succeed. That’s an entirely separate question, and that requires a lot of market savvy.

But beyond those concerns, just having cryptocurrency exposes you to the risk of theft, as hackers try to penetrate the computer networks that maintain your assets. One high-profile exchange declared bankruptcy in 2014 after hackers stole hundreds of millions of dollars in bitcoins. Those aren’t typical risks for investing in stocks and funds on major U.S. exchanges.

Should you buy cryptocurrency?

Cryptocurrency is an incredibly speculative and volatile buy. Stock trading of established companies is generally less risky than investing in cryptocurrencies such as Bitcoin.

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