Things to consider when buying cryptocurrencies from fiat
- You don’t have to buy a whole digit of a cryptocurrency (e.g. at least 1 bitcoin). You can purchase as much or as little as you like (e.g. 0.001 btc)
- What is the target cryptocurrency that you want to purchase?
- Not all exchanges support fiat (so you need to exchange with a popular cryptocurrency such as Bitcoin)
- Not all altcoins are on all main exchanges (e.g. Maxcoin can only be found on a limited number of exchanges)
- Do you have a preferred exchange that you want your cryptocurrency to reside on?
- e.g. an exchange that you will be trading on, one that you want to buy a specific altcoin from or one that is associated with a debit card (e.g. TenX)
- What are the exchange’s purchase and transfer fees?
Step 1 - Identify which cryptocurrency to buy
Before purchasing any cryptocurrency, you should learn about it, such as why it was created, its roadmap, its market cap and its performance history. Coinmarketcap provides this information in an easy to read format.
Sometimes you can't buy the currency you actually want (e.g. Maxcoin), because there is no way of buying it from fiat (such as USD), so you have to buy a popular cryptocurrency (such as Bitcoin), then one exchange, then from a second exchange; trade this for the cryptocurrency that you actually want.
Using Maxcoin as an example, I would:
Step 2 - Coinbase (easy, fast and cheap)
The easiset way to purchase one of the leading cryptocurrencies is via Coinbase, where you can purchase these crytocurrencies using a debit card, credit card or bank transfer:
| Symbol | Name |
|---|---|
| BTC | Bitcoin |
| BCH | Bitcoin Cash |
| ETH | Ethereum |
| ETC | Ethereum Classic |
| LTC | Litecoin |
| ZRX | 0x |
| BAT | Basic Attention Token |
| USDC | USD Coin |
The Coinbase website is really easy to use, safe, fast and reliable. Sign up with this link to get $10 USD Bitcoin for free when you buy or sell at least $100 of cryptocurrency.
If you live in Europe, UK or USA, you can transfer fiat money (Euro, GBP or USD) into Coinbase or Coinbase Pro (their trading platform) for free using one of the methods listed in the table below, saving you up to 3.99% debit/credit card fees. See the Coinbase fees page for information
| Region | Method | Transfer In Cost | Transfer Out Cost |
|---|---|---|---|
| Europe | Bank transfers (SEPA) (*) | free | €0.15 |
| UK | Bank wires (*) | free | £1 |
| USA | ACH Transfer | free | n/a |
| USA | Wire Transfer | $10 | $25 |
Note:
- * In some cases your bank may charge additional fees for transfers between your bank account and your Coinbase account
- Wire transfers move funds from one bank to another within one business day, and the money can even be available for spending that same day. That said, sometimes the funds aren’t visible in the recipient’s account, or you don’t have access to funds immediately after you receive a wire transfer. Although the process is mostly automated, a bank employee often needs to review wire transfers and get the funds into the destination account. If time is of the essence, request wire transfers first thing in the morning so there’s plenty of time to complete the process. International wires can take an extra day or two.
-
ACH transfers typically take two to three business days to complete. Banks and clearinghouses process ACH payments in batches—they’re all done together instead of being handled individually, first-come-first-served. However, the ACH system is moving toward same-day transfers, and some payments are already eligible for same-day treatment. Increasingly, you’ll see payments take place more quickly as organizations adapt to new rules.
When using the site, you simply select how you want to pay, which cryptocurrency you want to buy and how much you want to spend. It shows you all fees and the total cost before you confirm payment
Step 3 - The most cost-effective ways to buy cryptocurrency
Whilst Coinbase is perhaps the easiest and mostly widely adopted platform for purchasing cryptocurrency, there are other options to consider, especially if you are purchasing from outside Europe, UK and USA, or are buying large quantities or very frequently (e.g. for investment or trading purposes).
If you are from the Europe, UK or USA, one of the cheapest options is to transfer money (Euro, GBP, USD) into Coinbase Pro (either directly or via Coinbase) and then trade from there.
Coinbase Pro's fees are lower than Coinbase, however the interface is more complex to use (as with all exchanges). Another issue with Coinbase Pro is that the number of altcoins available for trade is very limited. So if you want to trade a wide variety of cryptocurrencies, you will need to buy Bitcoin from Coinbase Pro, then transfer the Bitcoin to another exchange.
Popular exchanges include:
| Exchange | Supports fiat | Good For | Benefit of signing up with the links below | Fees |
|---|---|---|---|---|
| Coinbase Pro | Yes | A cheap method to buy cryptocurrencies from fiat, especially if you are from Europe or UK, where you get deposits for free and a very low purchase rate | $10 USD Bitcoin for free (when you buy or sell at least $100 of cryptocurrency). Register with Coinbase first then log onto Coinbase Pro with the same logon details | Fees |
| Binance | No | Basic and advanced interfaces with rate discounts if you pay with BNB coin | Gives you a warm, fuzzy feeling; knowing that you have helped to support this site :-) | Fees |
| BitMEX | No | Up to 100x leverage on Bitcoin and high leverage on altcoin contracts | 10% discount on fees for 6 months | Fees |
| Deribit | No | Supports cryptocurrency futures and options trading. Supports multiple subaccounts under a primary user account | 10% discount on fees for 6 months | Fees |