If you are looking to buy cryptocurrencies like Bitcoin, Ethereum, Dogecoin, and many other popular crypto assets, you may be hard-pressed to know how to get started. This is understandable as there are many knowledge gaps in the crypto space. However, before you decide to buy and sell cryptocurrency, there are a few things you need to consider. First on the list is the best platforms to buy cryptocurrency, their fee structures, payment methods, and overall trading experience. In this How to Buy Cryptocurrencies guide, we will explore the ins and outs of cryptocurrencies and the best places to buy and sell cryptocurrency. Best Places to Buy Cryptocurrency in August 2021 We have tested several trading platforms in our round-up, and the following cryptocurrency exchanges and brokers are recurring recommendations by all traders (new and experienced alike). They are: eToro Capital Libertex Plus500 Coinbase Binance AvaTrade Revolut CryptoRocket Changelly These brokers were carefully hand-picked and reviewed as the best platforms to buy cryptocurrencies. They offer a good balance of low fees, fast transactions, and a great trading experience. They make it easy for both new and experienced traders to buy and sell cryptocurrencies. This is necessary given the complexities that surround digital asset purchase at the moment. In addition, they are security-conscious, meaning your details and funds are always safe with them. You can also store your digital assets in their crypto wallets safely, and they also comply with standard anti-money laundering (AML) and know-your-customer (KYC) policies. eToro - Our Recommended Crypto Platform OUR RATING CySEC, FCA and ASIC regulated US, UK and EU signups accepted Buy and Sell 20+ Cryptocurrency assets or trade CFDs Deposit via Debit or Credit card, Bank wire, Paypal, Skrill, Neteller Visit eToro 67% of retail investor accounts lose money when trading CFDs with this provider. How to Buy Cryptocurrency – Quick Guide to the Best Brokers for Buying Cryptocurrency in August 2021 Do you want to buy cryptocurrencies like Bitcoin right now? If yes, you can follow the four quickfire steps outlined below to get started. Open an account: You’ll first need to open an account with a trusted cryptocurrency broker. We recommend eToro, as the platform is heavily regulated, supports multiple deposit options with super-low fees. Upload ID: As a regulated brokerage site, eToro will ask you to upload a copy of your government-issued ID. Deposit: You can now deposit funds with a debit/credit card, Paypal, Neteller, Skrill, or a bank wire. Buy Cryptocurrency: Search for any cryptocurrency of choice and buy it commission-free. How to Buy Cryptocurrency- eToro Tutorial Gaining access to cryptocurrencies can be tedious if you are not using the right platform to do this. To make this process easier for you, we recommend using the eToro platform to buy and sell cryptocurrencies. In this section, we will explore how you can buy cryptocurrencies in as little as five minutes: Step 1: Open a Brokerage Account at eToro To get started, visit the official website of the eToro platform and click on ‘Join Now’ in the top right-hand corner. You will be redirected to a signup page where you will need to provide a username, email address and choose a unique, strong password. You can also decide to fast-track the signup process by opening an account with your Facebook or Google account at the bottom of the page. Step 2: Verify your identity The next step is to verify your identity. This is necessary because eToro is regulated by some of the top global bodies. Every new user will need to complete the know-your-customer (KYC) process to have their accounts verified. This requires a copy of your: Passport, driver’s license, or national ID card Utility bill or bank account statement issued within the last 3 months In most cases, eToro will authenticate your documents straight away and subsequently remove all account restrictions. Step 3: Fund Your Account To begin trading, you will need to fund your eToro account. eToro requires an initial minimum deposit of $200. In addition, eToro offers multiple payment methods to make this process easy for you. You can choose from: Debit/credit card (Visa, MasterCard, Maestro) Paypal Skrill Neteller Local bank transfer (country-specific) International bank wire In terms of fees, eToro charges just 0.5% on deposits – irrespective of the payment method. This is much cheaper than some of its main competitors, with Coinbase charging 3.99% to buy Bitcoin with a debit card. Furthermore, if you are a US resident depositing funds with a USD-backed payment method, there is no transaction fee at all. This stands at $50 for US residents and $200 for other countries regarding the minimum deposit. Step 4: Buy Cryptocurrency The final step is to buy the cryptocurrencies that you want. eToro allows you to choose from over 16 cryptocurrencies. You can buy Bitcoin, Ethereum, ADA, or even Dogecoin. To get started, head to the search bar and type in the cryptocurrency you want to purchase. Say, for example, you want to buy Ripple or Bitcoin, type ‘XRP’ or ‘BTC’ into the search bar and click on the first result that pops up. Once you get to the asset page, you can click on the ‘Stats’ button to get the financial track record of the digital asset. To complete the purchase process, click on the ‘Trade’ button on your right. You will be shown an order page like the screenshot above to choose how much you want to invest and set your stop-loss and take-profit levels. Step 5: Download The eToro Mobile App (Optional) This step is entirely discretionary and subject to your particular needs. However, if you will like to trade on your mobile when on the move, you can download the eToro mobile app. It is available for Android and iOS devices, and you can easily find it on the Play Store and Apple Store, respectively. Where to Buy Cryptocurrency As cryptocurrency adoption grows, so does the number of platforms offering access to these assets. Today, there are literally thousands of platforms where you can buy cryptocurrency. However, this creates a problem for traders. Finding the best platform to buy cryptocurrency could be challenging, especially for first-time traders. To save you on the hassles and hours in research, we did the heavy lifting. We reviewed hundreds of platforms before arriving at the best places to buy cryptocurrency. 1. eToro – Overall Best Broker To Buy Cryptocurrency Topping our best trading platform list is FCA-regulated broker eToro. Offering commission-free trades, eToro enables users to buy and sell cryptocurrency easily. Users can easily buy commodities, CFDs, ETFs, and trade FX currency pairs. Aside from this, the multi-asset platform grants exposure to over 3,000 global shares and stocks and 17 international markets. eToro is also a social trading platform and is often regarded as a social network for traders. It is user-friendly and has a great trading experience. Users can also copy fellow traders’ market moves through the CopyTrade functionality. The online broker also offers an in-house managed basket of assets that allows users to diversify their investment portfolios across various sectors. eToro requires a minimum deposit of $200, and you can fund your account through your debit/credit card, e-wallet, or bank account. Pros Regulated by the FCA, ASIC, and CySEC Social trading experience for users Commission-free crypto trades Supports multiple payment methods Minimum share investment of $50 [/one_half] Cons Conversion fee of 0.5% $5 withdrawal fee Buy Bitcoin Now 67% of retail investor accounts lose money. Invest responsibly. 2. Capital.com – Trade Crypto CFDs Commission-Free Capital.com is a global forex broker specializing in the trades of CFDs. Capital.com is a regulated broker with licenses from the FCA and CySEC. It has offices in London, Cyprus, and Belarus. Capital.com is user-friendly, and the account opening process is fast. It also offers exposure to cryptocurrencies ranging from large-cap cryptocurrencies like Bitcoin to Dogecoin. It also enables users to trade Bitcoin futures, crypto-to-fiat pairs, and crypto-cross markets too. Aside from cryptocurrencies, Capital.com allows trades for indices, shares, commodities, and popular FX pairs. It has low crypto and CFD fees which makes it a great platform to buy crypto assets. You can also start trading with as little as $20, and you can fund your account with bank transfers, credit/debit cards, and e-wallets. Capital.com does not charge you for depositing into your account or withdrawing your gains. Pros: Commission-free trades Wide range of investment solutions Regulated by reputable bodies User-friendly $20 minimum deposit [/one_half] Cons: Limited customizability for charts Offers CFD trades only Buy Bitcoin Now 71.2% of retail investor accounts lose money when spread betting and/or trading CFDs with this provider. 3. Libertex – Best Broker For Stocks and CFDs Libertex was founded in 1997 and has over two decades of experience in offering online trading services. It is regulated by the CySEC and is part of the Libertex Group of companies. Boasting over 2 million active users spread across 120 countries, Libertex allows trading indices, cryptocurrencies, stocks, commodities, and FX with the tap of a button. Users get to choose the trading platform they are comfortable with between the MetaTrader 4 (MT4) and the Libertex Web Trader. It is famous for its zero-spread pricing structure and offers exposure to 250 financial instruments. Advanced traders also enjoy perks like margin trades with up to 1:30 in leverage. Libertex offers negative balance protection, which protects users from unknowingly liquidating their accounts. In addition, its brokerage fee is 0.006% – one of the best in the industry – and users get to enjoy a rich trading experience. It requires a minimum deposit of $100 for a new account and $10 for recurring deposits. Deposits can be made through several channels, including bank transfer, credit/debit card, and e-wallet providers. Pros: Demo account up to €50,000 Low spreads 24/7 customer support Negative balance protection Cross-platform trading experience [/one_half] Cons: Limited product portfolio Variable spread system Less emphasis on educational content Charges for some withdrawal methods Visit Libertex Now Your Capital is at risk. 4. Plus500 – Regulated Platform CFD Broker Plus500 is a global CFD broker that is publicly traded on the London Stock Exchange (LSE). It was founded in 2008 and is regulated by the FCA and ASIC. Like Capital.com, Plus500 offers CFD products only, and users can access over 2,000 international financial instruments, including FX pairs, commodities, shares, indices, bonds, and cryptocurrencies. Plus500 offers a seamless and smooth trading experience allowing users to place trades easily. It also operates with an extra layer of security with its two-step login process. In its trading platform, Plus500 allows the integration of the WebTrader 4, which is quite good for experienced traders. It requires a minimum first deposit of $100 and accepts payment through bank transfer, credit/debit cards, and e-wallets. It supports 16 fiat currencies cutting across the US Dollars and the British Pounds. Pros: User-friendly trading platform Quick account opening process Great customer support Regulated by the FCA and ASIC Negative balance protection [/one_half] Cons: Does not support US customers Customer support is limited to emails and chats Limited product range, only CFDs Poor research tools Visit Plus 500Now Your Capital is at risk. 5. Coinbase – Largest Cryptocurrency Exchange in the U.S Coinbase is a crypto-facing cryptocurrency exchange. It is a publicly listed exchange and is quite popular with crypto investors due to its user-friendly trading platform. Founded in 2012, Coinbase offers exposure to popular cryptocurrencies and several altcoins. The Coinbase platform is meant for new crypto traders. It operates different platforms for specific users. More experienced traders favor the Coinbase Pro platform, which offers better fees and more trading tools. Coinbase is one of the top five largest cryptocurrency exchanges and offers crypto-custodial services for institutions, and has its COIN stock listed on Nasdaq. Pros: Great user interface for newbie traders Highly liquid Low minimum balance A great choice for altcoin trading Publicly-listed [/one_half] Cons: High fees No credit card payment method Visit Coinbase Now Your Capital is at risk. 6. Binance – Top-Rated Exchange to Buy Cryptocurrency Binance exchange is known for one thing; its sheer size. Founded in China, Binance is a rapidly-growing crypto ecosystem. Boasting decentralized exchange (DEX) platforms like PancakeSwap, Binance is the largest cryptocurrency exchange by trading volume. It’s also one of the best platforms to trade cryptocurrencies due to its low trading fees of 0.10%. Also, if you own its proprietary coin BNB, you get discounted fees when you pay with the token. Binance offers a wide variety of trading options, and users can execute margin trades, futures, and leveraged trading. Binance allows users to buy crypto with fiat currencies and offers over 300 crypto assets with thousands of trading pairs. Aside from crypto trading, Binance runs an earning program for passive income. Pros: More liquidity Low trading fees Great platform for experienced traders Largest crypto exchange Supports credit/debit deposits and fiat [/one_half] Cons: Debit/credit fees are expensive Not ideal for new traders Visit Binance Now Your Capital is at risk. 7. AvaTrade – Legacy Crypto Trading Platform for Investors AvaTrade is a top brokerage firm that offers exposure to over 600 global stocks and shares. It was launched in 2006 and has licenses from the British Virgin Islands and several locations. AvaTrade is also popular for its social trading app AvaSocial, enabling new traders to copy other traders’ moves and connect. AvaTrade is popular for the support of several trading platforms. These include the likes of MT4 and 5 alongside its proprietary AvaTrade platform. In addition, it operates an automated trading software with cutting-edge technology and a more inclusive trading experience. These include its Duplitrade, Mirror Trader, RoboX, and API Trading. AvaTrade also offers exposure to indices, stocks, commodities, cryptocurrencies, CFDs, ETFs and requires a $100 minimum deposit. Pros: Regulated in several jurisdictions Great customer support in multiple languages $100 minimum deposit Great educational resource [/one_half] Cons: Limited product inventory No guaranteed stop-loss Does not support US clients Visit AvaTrade Now Your Capital is at risk. 8. Revolut – Finance App With Crypto Support Revolut is not a traditional cryptocurrency exchange. However, the personal finance app provides support for cryptocurrencies–which is why it made our list. Based in London, Revolut allows users to send, receive, and exchange currencies all from the comfort of their phones. Revolut does not offer a trading platform, but it supports the exchange of over 30 cryptocurrencies in seconds. It also enables simple transactions allowing users to exchange their currencies without any hidden fees. Despite its generic business style, the London-based exchange service has over 15 million active users and is a preferred channel for international cross-border exchange of currencies. It also offers ticket and travel insurance on its Revolut app, and users can access loans. Revolut provides both physical and virtual cards. Pros: Great support for crypto assets Rapid currency exchange [/one_half] Cons: Poor customer support No trading feature Revolut can freeze customer accounts due to security reasons. Visit Revolut Now Your Capital is at risk. 9. CryptoRocket – Top Crypto Trading Platform Founded in 2018, CryptoRocket is a newcomer to the crypto scene. The platform operates out of St. Vincent and Grenadines but is not regulated by any financial authority. Aside from offering cryptocurrencies, CryptoRocket offers 55 FX currency pairs, 64 stocks, and 11 indices. It offers advanced chart tools as well as market news and analysis to help users trade with confidence. CryptoRocket offers one account type, the Standard CryptoRocket account, with leverage up to 500:1. Another unique style is that CryptoRocket adopts a segregated account system in which customer funds are kept separately from the company’s account. CryptoRocket accepts a low minimum deposit of $10, and you can pay with credit/debit cards, wire transfers, and Bitcoin. Pros: Fast order execution Low minimum deposit No deposit and withdrawal fees 24/7 customer support Great range of assets [/one_half] Cons: Not regulated Does not accept US clients Visit CryptoRocket Now Your Capital is at risk. 10. Changelly – Best Exchange for Instant Bitcoin Purchases Changelly is a top cryptocurrency exchange that enables users to swap, buy, and sell cryptocurrencies easily. Changelly is popular for its intuitive and straightforward trading platform, which allows users to locate the best exchange rate easily and quickly. It boasts over 2 million active users and runs a Changelly Pro variant that allows users to make passive income. Changelly operates out of Hong Kong. The platform is still not regulated by any known body, but it remains a safe and trusted service. Starting initially as a swap service, the Changelly exchange quickly expanded its services to buy and sell cryptocurrencies. It has continued to innovate, and its intuitive platform has served as a major draw for new traders. Its quick conversion feature is one reason why this platform is so popular in the crypto community. It runs a dynamic conversion system where a user can select between fixed and floating rate pricing. A floating rate pricing will see you pay for the current market rate. Fixed-rate will lock in the best exchange rate. However, customers have said that the exchange needs to improve its customer support and educational offerings. Pros: Quick conversion of digital assets Offers exposure to major assets Highly intuitive and user-friendly platform Pro version is available for advanced traders [/one_half] Cons: No phone support services Limited educational resources Visit Changelly Now Your Capital is at risk. Volatility Of Crypto Assets If you have been around long enough in the crypto circles, you may have come across terms like volatility a couple of times. This is because cryptocurrencies are highly volatile. This means you may make a killing in one trading session and see your gains erode in the next couple of minutes. A classic example is Bitcoin’s price which rose over 100% in the last six months, reaching a record $64,350 valuation but has struggled to break above the $35K mark for the last couple of weeks. Critics have pointed to these wild price swings as a reason why cryptocurrencies cannot replace cash. Nonetheless, cryptocurrencies are an exciting investment class to watch out for. To guide you in your quest, we recommend checking out expert crypto review sites (like ours) with dedicated teams of experts working round the clock to give you the best recommendations on the ever-changing market trends. This will save you lots of heartaches as you will be exposed to crypto projects with growth potential and proven track records. You can check out the Price of Cryptocurrency in real-time here. Storing Cryptocurrencies Just like every item, cryptocurrencies need to be stored. Given that they are lines of computer code, they cannot be stored in a physical location. You will need a crypto wallet to keep your crypto funds. Aside from storage, crypto wallets also allow you to do some other stuff like execute trades, monitor market trends, and make crypto-to-crypto swaps almost instantaneously. Choosing the right crypto wallet goes a long way in determining your digital assets’ security, so we have selected the best crypto wallets available for mobile and desktop users. eToro Mobile Wallet eToro offers one of the most user-friendly crypto wallets in the crypto space. Not only can you store your cryptocurrencies, but you can also create a custom watchlist to stay informed on real-time market updates. In addition, you can also trade a wide variety of top cryptocurrencies and gain access to advanced charts and analytical tools. eToro also imports its signature social trading into its digital wallet offering. You can copy trades from industry-leading experts through the CopyTrader feature. The eToro blockchain wallet is available for Android and iOS devices, and you can find it on the respective app stores. The eToro wallet is secure as it is regulated by the Guernsey Financial Services Commission (GFSC). You will also be able to access a password recovery service if you lose your private keys. Selling Cryptocurrencies If you intend to sell your cryptocurrencies, either because you no longer want to hold a particular crypto asset or you have made profits from investing in them, then the process is just as when you initially bought it. Since the crypto asset is within a digital wallet, you can easily initiate the withdrawal request. Although there are several means you can employ to offload your crypto holdings, the best and safest way is to do this through a regulated exchange like the eToro platform. This way, you get a guarantee that your account will be credited when you decide to sell off your asset. Choosing The Right Broker Previously, it was not easy to buy cryptocurrencies as only a few brokers offered crypto custody services. However, times have changed with cryptocurrencies becoming a major market segment. Now, several trading platforms are offering crypto-related services. As good as this may sound, it presents a new challenge, and this is, how do you select the right broker to buy cryptocurrencies through? As dire as this situation may seem, we have chosen a few criteria to help you in your quest. Brokers are unique in their offerings, and you need to ensure whichever you choose to work with ticks the following boxes: 1. Fees This is the first parameter to consider in choosing a broker. You need to know how much a cryptocurrency broker charges for deposits and withdrawals. Another cost to consider is the commission for trades. It is now an industry norm for brokers to offer commission-free trades. Platforms like eToro and Capital.com offer such perks. You should also consider hidden fees that a broker may be charging and its inactivity fee structure. 2. Payment Methods This is also necessary. The more payment channels a broker boasts of, the easier it is to fund your account. Some brokers allow you to buy Bitcoin with PayPal. Others do not accept credit card deposits, while some may take longer to process bank wire transfers. Look out for these signs. 3. Crypto Offerings Given that we are discussing investing in digital assets, you need to know how many cryptocurrencies a broker supports. Some brokers offer crypto CFDs meaning you do not have to worry about custody of the underlying asset. If this works for you, you should try such brokers out. 4. Security You need to find out if your chosen broker is a regulated entity. Licenses from reputable regulatory bodies like the FCA show that the broker is secure, meaning your funds will not suddenly disappear into thin air. Your data will not also be compromised in the event of a breach due to the constant audits the broker will be undergoing. 5. Minimum Deposits Minimum deposits are also crucial. You need to know what the lowest financial bar a broker requires to admit a new client. This can be a great way to test your trading strategies with little capital before investing large sums. 6. Social Trading Social trading is gradually becoming an industry standard. It’s the process where trading platforms to provide a means for traders to follow the latest market trends and news. This also allows new traders to develop themselves to connect and learn from their more experienced counterparts. One of the best in this fast-growing social trading experience is Israeli broker eToro, enabling traders to connect and learn from one another. The platform also boasts a CopyTrading feature that allows you to copy other people’s successful trades automatically. 7. Support Although many traders may not count this as important, customer support is crucial to handling sticky situations. Given that the cryptocurrency space is still evolving, many traditional investors are still confused about how the asset class works. Great customer support from a broker can make this process easier and more seamless. Many brokers now offer support in several languages. You should also look out for 24/7 technical support putting into perspective the weekends when you might want to place trades. 8. Usability The ease of use of a trading platform is also important. Can you find your way quickly and easily around the trading platform? Can you get things done on time and leverage on market trends? Given that we are busier now than ever before, this can be a major challenge if a trading platform is not user-friendly. Whichever broker you choose to work with must be user-centric and make the trading experience painless and seamless. 9. Analytical tools Just like the traditional financial markets, cryptocurrency trading requires analytical tools. A good trading platform must offer good statistics and great insights on a chosen digital asset. This will help guide your investment decision and make it easier for you to choose the cryptocurrency you want to invest in. These parameters can help you in your search only so much. The best means of getting the best trading platform advice is checking out review sites on a particular broker. Even though it may sound like a cliché, it is very important if you intend to take cryptocurrency trading seriously. There are so many trading platforms that are popping up by the day with fantastic offerings. You need to know how to sieve the wheat from the chaff. Knowing a reliable broker from the less-trustworthy ones can be difficult. Review sites will help you out in this regard as they will break down the finer details and offerings of a particular broker. Also, the comparison parameter will make it easier for you to compare between two platforms and know their pros and cons. Another benefit lies in the fact that you will learn if a broker is a scam or legit, which is very important if you intend to avoid bad actors from stealing your funds. Which Cryptocurrency To Buy In 2021? With both large and small-cap cryptocurrencies seeing exponential growth in the last six months, it can be difficult to decide which cryptocurrency to buy. Even though Bitcoin still leads the emerging industry, several crypto protocols also get investors’ attention either by their value proposition or by user adoption. However, choosing the best cryptocurrency boils down to you. If you are a value-driven investor looking to buy low and sell high, several small-cap cryptocurrencies will likely fit into your budget. Another metric may be the future proposition for a given project. The more use case and adoption a crypto asset sees, the more growth potential it has. Meanwhile, relying solely on a crypto project’s whitepaper and claims will not likely cut the ice in returns. A great way to stay on top of market developments and shifting trends is to peruse review sites like InsideBitcoins with a dedicated team of experts who are familiar with the inner workings of the crypto market and can make the safest recommendations for you. Bitcoin Bitcoin is a well-known digital currency. Over 95% of Americans equate the crypto market with Bitcoin. This is, in a way, true due to the large stake the oldest cryptocurrency has in the nascent sector. Launched in 2009 following a whitepaper by mysterious founder Satoshi Nakamoto in 2008, Bitcoin is the largest cryptocurrency and, at the moment, the most valuable. Since its debut, it has grown more than 9,000,000% and has seen wide adoption by retail and institutional investors and world governments. Despite its outstanding success, Bitcoin is the most criticized cryptocurrency for several reasons: environmental concerns, government inability to influence policies in the Bitcoin network, volatility, and its use by criminals to move funds. Meanwhile, Bitcoin has not slowed in its strides, and 2021 has been its big break. Coming into the year at little over $30K, Bitcoin has more than doubled its value rising to an all-time high (ATH) of $64,350 in mid-April. Even though it has since seen its value slashed by half, Bitcoin still commands the largest trades and sits top of the global crypto table. If you want to add the top crypto asset to your investment portfolio, click on the How to Buy Bitcoin guide. Ethereum Besides Bitcoin, Ethereum is the only cryptocurrency that pulls significant weight in the crypto industry. Controlling 17.1% of the crypto market, Ethereum is a popular decentralized applications (dapps) platform founded by a group of software engineers and scientists led by Russian-Canadian Vitalik Buterin. Even though most of the early founders have since left to form independent crypto projects, Ethereum is the most recognized dapps platform and the official home of the booming decentralized finance (DeFi) space. Even though it has been criticized for its high gas fees and network congestions occasioned by its continued reliance on proof-of-work (PoW) consensus protocol, Ethereum has over 200 DeFi protocols actively transacting on its blockchain. It has continued to see its influence grow by the day, given the exponential increase in DeFi projects. It surged to a record $4,350 before market pressures saw it lose more than 50% of its value. However, Ethereum may see its fortune change once it transitions to the less energy demanding proof-of-stake (PoS) protocol by the end of the year. If you want to learn more about the Ethereum project, you can check out our How to Buy Ethereum guide. Dogecoin Meme-based cryptocurrency Dogecoin has been a revelation this year. Even though it has not crossed the $1 mark since its debut in late 2013, the parody coin has come close to doing so. Rising to a record $0.74 in the heat of the crypto wave, Dogecoin increased 15,000% year-to-date (YTD). Its phenomenal gains have seen the joke cryptocurrency attain a pop star status attracting celebrity support and birthing a whole bevy of dog-themed cryptocurrencies. Even though Dogecoin has no generic use case aside from the Shiba Inu (not to be confused with a similarly named crypto project) being a fun and cute crypto protocol, Dogecoin has continued to make waves and temporarily surpassed the likes of Ford Motors and Twitter in the market valuation. Trading way below its record high, Dogecoin is not going anywhere soon, with Tesla boss Elon Musk aiming to make it a next-gen interplanetary currency in the future. We have highlighted some market-moving trends of Dogecoin in our How to Buy Dogecoin guide here. Alternatives To Bitcoin Bitcoin is the premier digital asset, no doubt, and there is a slim chance that any crypto protocol may topple it from its first position on the crypto ranks. However, 2021 has seen many crypto assets making a bold entrance into the crypto space. With several digital assets posting remarkable gains, investors are looking for small-cap cryptocurrencies with growth potential. In this section, we will briefly explore five of such crypto protocols: AAVE The digital token of the crypto lending protocol Aave, this digital asset, has been a revelation this year. With the protocol enabling cryptocurrency owners to earn passive income from lending out their crypto holdings, Aave is the most valuable DeFi protocol with a controlling share of 16.64% in the burgeoning DeFi market. The AAVE token has shown good growth metrics surging from $88.05 on Jan. 1 to $643.07 on May 18, increasing more than 4,000% in the process. Even though it has dipped in value, AAVE is still a crypto asset to watch out for and may become the next Bitcoin in the emerging DeFi sub-sector. Read more from our how to Buy AAVE guide. DOT Polkadot is the result of a failed Ethereum dream of building an interoperable and scalable network. Founded by former CTO and co-founder of Ethereum Gavin Wood, the heterogeneous multi-chain solution has been dubbed an ‘Ethereum killer’ from the get-go. It has not proven its supporters wrong, barreling its way into the top ten most valuable cryptocurrencies and making remarkable strides towards enabling an interconnected blockchain ecosystem. The DOT token has seen a mixed price action like most cryptocurrencies, but it has been able to keep its head above water. Coming into the year with an $8.88 valuation, DOT has grown more than 200%, plateauing at $48.36 on Apr. 14. ADA Another popular ‘Ethereum killer’ and one with a history to the popular dapps platform. ADA is the digital token of the Cardano network, which is developed by Hong Kong-based software firm Input Output Hong Kong (IOHK) and Emurgo. Cardano is a proof-of-stake (PoS) blockchain network that uses the self-styled Ouroboros mining protocol to validate transactions on its protocol. The beauty of the Cardano network is that it is still under development, but the project has quickly grabbed investors’ attention, given its value proposition. The Cardano aims to build a new financially inclusive ecosystem where anyone can participate without fear of censorship. With its promise of lower fees and interoperability, Cardano’s ADA has been one of the best-performing crypto assets in the last few months. It surged from under a dollar valuation to over $2.45 in May. Cardano’s low price and future potential is a great investment opportunity for any investor. Read more from our how to Buy Cardano guide. Binance Coin Known simply as BNB, this digital token is not tied to a crypto protocol but a centralized cryptocurrency exchange known as Binance Holdings. It plays several roles in the rapidly expanding Binance ecosystem and enables its holders to enjoy lower fees on Binance-owned platforms. Aside from this, the proprietary coin is used in settling online services purchases, ticketing, and several other utilities. The BNB may not be a top crypto project, but its meteoric rise is nothing short of outstanding. Coming into the year at little over $40, BNB surged to a whopping $650 in the May crypto frenzy. This saw it occupy the fourth most valuable cryptocurrency, and it has retained the position for much of the year. With a burning schedule done every quarter, BNB slowly sees its 200 million tokens become more valuable by the day. Meanwhile, its present trade below $350 may be a great position to buy the BEP-20 token. SOL Another potential alternative to investing in Bitcoin is blockchain protocol Solana. Also dubbed the ‘Ethereum killer’ tag, Solana is a permissionless, open-source crypto platform that enables DeFi solutions. It also claims to be faster in verifying transactions than the Ethereum network with a reputed 50,000 transactions per second (TPS) record. Using an innovative consensus algorithm proof-of-history (PoH) and the proof-of-stake (PoS) protocol, Solana has seen growing adoption with more DeFi projects migrating their services to the Solana network. With DeFi set to continue its parabolic rise with growing investor interest in the sub-sector, Solana may soon challenge the Ethereum network as one of the best platforms to build DeFi protocols. Its SOL token has also seen positive price action moving from $1.8 to a record $55.91. It is projected to continue its uptrend despite the market downturn. Bitcoin Trading Robots Aside from actively participating in buying and selling cryptocurrencies, you can easily outsource your trades to Bitcoin trading robots. These programmed bots are automated software that place trades on your behalf. They leverage algorithms (predicting market trends and making informed investments before anyone else) and trading signals that outweigh the trading capabilities of everyday investors. Trading robots can also help to reduce risk and losses. Even though the niche is still in its infantile stages, the future is promising, and it could end up rendering hedge funds and institutional investors redundant as the technology continues to garner interest. However, the technology is unregulated, meaning you should only deposit funds you can afford to lose. Our review team has a vetting system to help filter out genuine trading software from the rest. Some of the notable trading robots that we’ve reviewed include: Bitcoin Prime Bitcoin Miner Bitcoin Trader Taxing Crypto Earnings Crypto assets are placed in different umbrellas by different government agencies. While some countries prefer to see them as commodities, some others have pegged them as securities. However, most tax agencies are ramping up efforts to generate revenue from the booming crypto space. The US Internal Revenue Services (IRS) considers cryptocurrencies as “property,” making them subject to capital gains treatment. Meanwhile, sometimes they are also treated as income and are subjected to the income tax laws. In the US, the following crypto trading activities are considered capital gains taxable events: Exchange crypto for fiat currencies Paying for goods and services with cryptocurrencies Swapping a crypto asset for another through an exchange or peer-to-peer channels Income tax earnings for crypto are listed below: Airdropped crypto Income generated from lending on DeFi platforms Block rewards gained by mining crypto Crypto gains made from staking and liquidity pools Getting paid with crypto However, you can still repurpose your losses to offset your capital gains tax obligations. You can even save up to $3,000 on income tax when you hold on to your crypto assets for a long period. Calculating Your Capital Gains Tax The total amount you will pay for trading cryptocurrencies or owning digital assets depends on long you have held them. This will go a long way in determining your: Short-term Capital Gains This will be determined if you started trading crypto less than a year ago. Whatever gains or losses you may have incurred will be taxed at the same rate as your normal ordinary income and is subject to the short-term capital gains tax. However, your losses could help to offset your taxable income up to $3,000. You can also move those losses into the following year. Crypto tax Long-term Capital Gains Long-term capital gains operate differently from the short-term variant. If you have held crypto-assets for more than a year, you are eligible to pay 0%, 15%, or 20%, depending on your income. You can see a revised list from the IRS here. Why You Need To Invest In Crypto Responsibly Starting with the launch of Bitcoin in 2009 by Satoshi Nakamoto, the crypto market has only been on an upward trajectory. Meanwhile, the first-ever cryptocurrency has grown more than 9,000,000% since inception leading the infant sector into a unicorn status in the shortest time possible. This remarkable feat has seen both retail and institutional investors join the crypto bandwagon. However, investing in crypto comes with its own set of risks, and we will like you to keep the following in mind when trading digital assets: Constant Research The crypto space is an ever-evolving space with new crypto projects springing up by the day. To make the best gains, you need to stay updated on the latest market trends and movements by researching. Social media channels highly influence cryptocurrencies, and you can leverage social trends and make gains before market pullbacks. You can also turn to crypto market news on major financial channels and listen to expert analyses on cryptocurrencies. One such review website is Inside Bitcoins which will provide you with the latest updates on Bitcoin and several altcoins. Limit Your Risk Exposure Cryptocurrencies are known to be highly volatile, which means they can spike up and crash within hours. This could be disastrous if you did not properly hedge your bets. When the market is turning against you, make sure you pull your investment to limit your risk exposure. Do not rely on the idea that it will rise immediately. It may take days – even months – before the bears lose grip of the market. Should You Buy Or Trade Cryptocurrencies? The decision lies mainly in your hands, and you may need to consider a few things like your budget, your needs, and your preferences. If you are a day trader, selling cryptocurrencies (trading them) may increase your alley. However, if you are more long-term in your investment strategies, you may consider buying value-driven crypto assets for the long haul. Meanwhile, there are a few differences in both strategies: Buying Trading Mid to long-term investment Short-term investment Lower risks, lower rewards Higher risks, higher rewards Make payments with crypto Trade as contracts for differences (CFDs) Buy and own the underlying asset No physical possession of the underlying asset Conclusion The crypto market is an exciting field to invest in, but it also has its peculiarities. In this section, we will summarize the major points of this guide: Cryptocurrencies are fast-growing digital currencies and are considered the future of money. Crypto assets are highly volatile, meaning they experience wild swings You can automate your trades with reliable Bitcoin trading robots Always consider review sites like Inside Bitcoins before investing in cryptocurrencies Several trading platforms offer crypto trades. eToro is our recommended broker for crypto, and it provides commission-free trades Crypto trading activities are taxable under the US tax laws eToro - Our Recommended Crypto Platform OUR RATING CySEC, FCA and ASIC regulated US, UK and EU signups accepted Buy and Sell 20+ Cryptocurrency assets or trade CFDs Deposit via Debit or Credit card, Bank wire, Paypal, Skrill, Neteller Visit eToro 67% of retail investor accounts lose money when trading CFDs with this provider. FAQs How Can I Buy Cryptocurrency? You can purchase your desired cryptocurrencies through several means. One way is to use cryptocurrency exchanges like Binance. However, most crypto exchanges are not regulated, which presents a risk to your investments. Another means is to buy through traditional trading platforms that offer crypto exposure and are licensed to provide financial services. One of the best is eToro, famous for its social trading platform where you can copy professional traders' moves and interact with fellow traders. You will also enjoy commission-free trades meaning you don't have to pay any extra charges for buying a crypto asset. How Can I Sell Cryptocurrency? You can sell your crypto holdings in various ways, but we recommend selling them through the platform you initially bought them from. This will ensure that you get your money back and avoid bad actors. If you want to sell your cryptocurrency on the eToro platform, you can just click on 'Withdraw Funds' and choose the asset you want to sell. Click on 'Close Trade' and confirm the withdrawal method. Your funds will be deposited as soon as possible, depending on the channel you chose. Where To Buy Cryptocurrency? With many trading platforms now offering crypto services, it can be difficult to choose where to buy cryptocurrency. However, some of the most well-known platforms are eToro, Binance, Coinbase, and others reviewed in this guide. All these exchanges offer different packages, and you need to compare them to know which one you are comfortable with. What Are The Best Brokers To Buy Cryptocurrencies From? The best brokers to buy cryptocurrencies are eToro, Binance, Coinbase, Capital.com, Libertex, Revolut, Plus500, CryptoRocket, AvaTrade, and Changelly. However, eToro is our recommended broker due to its commission-free crypto trades and social trading platform. It is also user-friendly, making you place trades easily. What Payment Methods Can I Use To Buy Cryptocurrencies? There are numerous payment methods for buying cryptocurrencies. You can buy cryptocurrencies with credit/debit cards, Paypal, Neteller, Skrill, Sofort, and bank wire transfers. It all depends on the platform you transact with. What Is A Cryptocurrency Exchange? A cryptocurrency exchange is a trading platform that allows you to buy and sell cryptocurrencies. Following the traditional exchange style, you will utilize analytical tools, perform technical analysis, look at the order book, and place trades. Some like Binance also offer financial services like earning interest on your crypto savings and borrowing. What is a Bitcoin Exchange? A Bitcoin exchange is another term for a cryptocurrency exchange. How Does A Bitcoin Exchange Work? A Bitcoin exchange operates much like Nasdaq. It facilitates trade between a buyer and seller, albeit in cryptocurrencies. A Bitcoin exchange adopts the same operational module as a brokerage firm, and you can fund your account through a bank transfer or other means. However, you will pay a fee for the service. Is Buying Cryptocurrency Safe? Buying from regulated entities like eToro is safe, and you can be assured that bad actors will not steal your funds. eToro has been in the trading business since 2006 and has not reported a security breach. This shows the high regard they hold towards securing user funds. Do I Have To Pay Taxes When Buying Or Selling Cryptocurrencies? According to the US IRS department, trading cryptocurrencies is taxable and falls under the capital gains tax. Check out our section on taxation to know how much you need to pay as taxes. Which Cryptocurrency Should I Buy? Before deciding on which one to invest in, you need to conduct thorough research on the digital asset you are interested in. Even though Bitcoin is a clear favorite, several other alternative currencies (altcoins for short) have growth potential. What Are The Safest Cryptocurrencies To Buy? The crypto market is highly volatile, which means gains can be wiped out in seconds. Another major challenge is that altcoins are tied to Bitcoin’s price movement. This means if Bitcoin goes up, other digital assets also rise and vice-versa. Bitcoin price action is a good marker to evaluate crypto investments. What Are The Most Popular Cryptocurrencies To Buy? The most popular digital assets include the likes of Bitcoin, Ethereum, Binance Coin, Dogecoin, Cardano, XRP, Polkadot, and UniSwap.