Introduction: What is a cryptocurrency?
Cryptocurrencies have taken an outstanding development over the years and are increasingly coming into the focus of investors. Just a few years ago, Bitcoin and Ethereum were still considered objects of speculation for IT freaks.
However, this circumstance has changed, as more and more private and institutional investors are keeping an eye on the development of digital currencies. In total, more than 8,200 cryptocurrencies exist today.
To buy a cryptocurrency, you need to go through the following steps:
In the following article, we will go into more detail about how and where you can buy cryptocurrencies. We list various exchanges and trading platforms on which you can invest in crypto currencies. We advise you to take a closer look at the provider before choosing an exchange.
You should always prefer large and well-known exchanges to smaller, unknown platforms. If you want to get started right away, click on this link to go to the step-by-step guide with screenshots. Want to get started right away? Distributed ledger technology as the technical basis of cryptocurrencies
Distributed ledger technology, or DLT for short, is a distributed and decentralized database. This technology provides a verifiable history of all information stored on this distributed general ledger.
Accordingly, DLT are digital systems that record the transactions of all assets and store them decentrally in the network. Unlike traditional databases, DLTs do not have a central data storage or management function.
The validation of the pending transactions and information is carried out by the nodes, to German nodes. Through validation, a record of the elements is generated and distributed throughout the network. This approach creates a consensus within the network.
Thus, the technologies are suitable for recording registrations or transactions.
Blockchain explainer video from youknowBlockchains are the most well-known distributed ledger technologies
Probably the best-known type of distributed ledger technologies are blockchains.
The functionalities are similar to those of the DLTs in almost all respects. The biggest differentiator is the type of data storage, because this takes place in a blockchain in a block.
Accordingly, a blockchain combines several transactions and stores them in blocks. These are strung together in a chain to generate a particularly high level of security.
For the concatenation of the blocks, blockchains use cryptographic signatures – the so-called hashes. Each block picks up on the hashes of the previous block and thus prevents unwanted manipulations.
In addition, this technology opens up the possibility of defining automated rules in transaction processing. These rules are smart contracts, also known as smart contracts.
In practice, there are also distributed ledgers that do not exist in the form of a blockchain – the best-known example is IOTA. The first blockchains were also based on so-called proof-of-work (PoW) algorithms for transaction validation.
Today, blockchain technologies without PoW have better scalability and are therefore more versatile.
Probably the best known, because first, blockchain is Bitcoin. Satoshi Nakamoto published the whitepaper for Bitcoin back in 2008. In January 2009, the developer operating under the pseudonym published the Bitcoin Blockchain. The success of Bitcoin as well as its disruptive potential is known to most users today. Where can I buy cryptocurrencies?
The market for crypto currencies is no longer in its infancy, so there are now numerous ways to buy crypto currencies.
Below you will learn more about the possibilities to buy cryptocurrency. With these steps, even beginners can buy cryptocurrencies.
In order to find the best crypto exchange for you, you should first define your trading habits. Do you want to buy cryptocurrencies once and then send the coins to your wallet or are you more interested in the price movements and active trading?
What type of investor are you Buying cryptocurrency from a broker
Probably the easiest way to trade cryptocurrencies are crypto brokers.
Crypto brokers often offer trading with Contracts for Difference, CFDs for short. This is a type of security that reflects the price of a cryptocurrency.
Especially the platforms of eToro, Plus500 and Libertex convince with a good user experience and a very good product range. eToro Capital.com Libertex Coins
Min. Deposit 200 EUR 20 USD Card / 250 USD Wire Transfer 100 EUR Commission 0.75 – 5% Min. 0% Min. 0.03 % Leverage up to 2:1 up to 2:1 Regulation CySEC, FCA CySEC, FCA, ASIC, NBRB CySEC Other Instruments Stocks, Commodities, Forex Stocks, Forex, Commodities, Indices CFDs on ETF, Stocks, Forex, Commodities, Indices Users 780,000+ 1,800,000+ 2,200,000+ Website Continue to eToro
Risk Warning Disclaimer: 68% of retail CFD accounts lose money Crypto investments are offered by eToro (Europe) Ltd. and custody is carried out by eToro Germany GmbH. Your capital is at risk. Continue to Capital
Risk Warning Disclaimer: 73.81% of private crypto CFD accounts lose money.
Risk Warning CFDs are complex instruments and carry a high risk of losing money quickly due to leverage. 70.8% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work and whether you can take the high risk of losing your money
CFDs are complex instruments and carry a high risk of losing money quickly due to leverage. 67-83% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work and whether you can take the high risk of losing your money deposit options
Crypto brokers often excel with a wide range of deposit options.
For example.B, eToro offers the following ways:
- Bank transfer (SEPA)
- Credit card
To be emphasized here is the possibility of being able to buy crypto currencies with PayPal, which other providers do not allow. Fees at crypto brokers
Fee models of crypto brokers differ from crypto exchanges in that there are no classic transaction fees.