Before you get started with crypto, you need to know what platforms are out there (Credits: Getty Images)
Anyone wanting to get started with cryptocurrency investing will be faced with an avalanche of information and opinions.
Where should you start? Which platform should you use? Which coins should you invest in?
The very first thing to keep in mind is that you should be dealing only with reputable exchanges – places where cryptocurrency is bought and sold.
Since January 2020, any crypto exchange operating in the UK has to register with the Financial Conduct Authority (FCA) under money-laundering rules.
There are 31 companies (at time of writing) that have made it onto the FCA’s registration list, including well-known exchanges like CoinJar and eToro.
While it doesn’t make cryptocurrencies themselves any less risky, it does at least mean the companies handling them have been checked and approved by the City watchdog.
You can find the full list right here.
However, it’s important to note there is still no Financial Services Compensation Scheme (FSCS) protection in place if the exchange goes out of business.
Once you’ve selected which exchange you want to use, actually buying cryptocurrency is relatively easy to do.
How to buy cryptocurrency
You’ll need to sign up for an account and register a bank account. Then it’s just a case of checking the current value of the various different coins and selecting how much you want to buy.
It’s crucial to have a look at any trading fees you may be charged by the exchange. In many cases, it may be free to open an account but there may be a percentage charge for buying and selling crypto.
There are literally thousands of cryptocurrencies to choose from, with more being created all the time.
The most recognisable continue to be Bitcoin, Ethereum, Ripple, Cardano and Litecoin so if you’re going to get started, it would be worth focusing on one of these. Ignore the ‘meme coins’ like Dogecoin and Shiba Inu Coin for now.
Bitcoin has always been and remains the most valuable cryptocurrency by market cap – by a significant margin.
In fact, Bitcoin makes up around 60% of the crypto market by itself. So if you’re still unsure which coin to go with, it makes the most sense to start with Bitcoin.
Sam Volkering says…
Sam can help you find the right platform to get started with
You need to go to what’s called an ‘on ramp’, which is really just an exchange that you would use to buy cryptocurrency with your pounds.
Bottlepay is a home-grown UK company that allows you to easily buy Bitcoin.
Sam Volkering writes about cryptocurrencies and other tech-based investment trends at Exponential Investor.
You can follow him on Twitter here.