Investing in cryptocurrency has become extremely popular in the last year or two as it has gained more visibility in popular culture.
If investing in Bitcoin and other cryptocurrencies have piqued your interest, you may be wondering, where does a beginner go to get started?
Some of the questions you might be asking include:
- How do you buy cryptocurrency?
- Can you use traditional fiat currency to purchase crypto?
- Are there cryptocurrency banks or financial centers where you can buy Bitcoin or other altcoins?
We'll be looking at these questions in this article, as well as sharing our list of some of the top places to invest in Bitcoin (or other cryptocurrencies).
What Is Cryptocurrency?
Bitcoin and other cryptocurrency are virtual currencies that you can use online in exchange for goods and services, or to trade for profit like you would stocks and bonds.
Many companies also issue their own currencies, often called tokens, and they can be traded specifically for the good or service that company provides. This is similar to how an arcade token or casino chip would work in the real world.
Cryptocurrencies use a technology called blockchain, a decentralized technology spread across many computers across the Internet, that manages and records all transactions.
What Are The Best Cryptocurrencies To Invest In?
According to CoinMarketCap, as of early 2021, over 7,800 cryptocurrencies are currently in existence and more of them are popping up all the time.
As of the publishing of the article, here are the top 10 largest trading cryptocurrencies by market capitalization, as tracked by CoinMarketCap.
Binance Coin (BNB)
Bitcoin Cash (BCH)
(Data current as of May 10th, 2021).
The global crypto market cap is $2.45 trillion as of May 2021, and of that Bitcoin has over 40% of total market share. Because it is the original crypto, and one of the most widely used, Bitcoin is often used as shorthand for cryptocurrency, even though there are thousands of them, and others are now increasing in popularity.
As to what cryptocurrencies are the best to invest in, that's a choice you'll have to make. Many people would invest for the long term in some of the larger more proven cryptos above like Bitcoin, while others are bound to ride the waves of popularity on popular meme coins like DOGE (also above), selling when they're at what they hope is the peak. If you decide to jump into crypto, do your homework, find out the differences between all of the cryptocurrencies, and invest in crypto with caution.
How To Invest In Bitcoin And Other Cryptocurrency
Investing in bitcoin and other cryptocurrency is becoming easier every year due to the proliferation of apps, crypto exchanges and decentralized cryptocurrency exchanges online.
To invest in a cryptocurrency is extremely similar to how you invest in stocks.
When investing in stocks you open an account with a brokerage or investing service, you transfer cash into your account from your linked bank or credit card, and then you buy an investment with the deposited funds. You hold the stocks or bonds until which time you decide to sell and lock in your gain or loss in that investment. Once it is sold your cash is returned to your cash balance.
With cryptocurrency you have a similar process. You open an account with a cryptocurrency exchange (like Coinbase for example), deposit funds from a linked bank account, and then buy a cryptocurrency of your choice (whether Bitcoin, Ethereum, Litecoin, etc). You can then hold the crypto in your cryptocurrency wallet until which time you decide to sell it (hopefully with a large gain).
When buying cryptocurrency there are often fees associated with the transaction, both with the currency exchanges that you're buying through, and what are called miner's fees, paid to the computers across the internet that are running calculations and recording the transactions to the blockchain. So buying crypto can get pricey, depending on what you're buying, where you're buying it and what the process is.
How To Use A Cryptocurrency Exchange
So let's examine how crypto trading at a cryptocurrency exchange looks from start to finish. We'll use one of my favorite exchanges, Coinbase, as the example.
We love using Coinbase, not only because the site has a clean, easy to use interface, but also because they're one of the most well respected crypto sites.
Open A Crypto Exchange Account
To get started you just open the free Coinbase account through our link.
After entering your email, password, some personal details you'll usually have to verify your identity via the exchange's "Know Your Customer" (KYC) identity verification process.
Link Your Funding Source
After setting up the account you can link a bank account or credit card. I ended up linking to both during the setup process just in case, but it should be noted that there are usually more fees when purchasing Bitcoin or other crypto using a credit card. Be aware of what those fees are before you purchase.
Once you have linked your bank or funding source, you can transfer funds to the exchange. The funds will be held either in a wallet where fiat USD currency is held (to wait for the right moment to buy), or you can just purchase one of the available cryptocurrency directly that are tradeable on the particular platform.
Buying Bitcoin Or Other Cryptocurrency
In the screenshot below, you can see if you want to buy Bitcoin you can enter a dollar amount that you want to invest in the right sidebar, and it will convert your dollars to the amount of Bitcoin that you'll be purchasing based on the current exchange rate. It will also tell you what fee you will pay when purchasing.
So in this case, let's say we decide to purchase $1000 worth of Bitcoin. To do that we'd just click on the "Buy" button next to Bitcoin (BTC) cryptocurrency.
On the screen that pops up we enter $1000 as the dollar amount, and hit "Preview Buy". It will then give a preview of how many Bitcoin will be purchased, what funding source you'll be using for the purchase, what the current price of BTC is, and what the fee will be for this purchase. Fees will vary depending on a variety of factors, check with the exchange you're using for current fees.
In our example, at the current price, we would be getting 0.01754794 BTC. That's $985.32 worth of Bitcoin after the $14.68 Coinbase fee.
Once we hit buy now, the Bitcoin is purchased, and it will be sent to our specific Bitcoin wallet at Coinbase to be held for us indefinitely until we decide to sell, convert (to another crypto like Ethereum) or transfer to another crypto wallet or exchange.
When you purchase crypto on Coinbase it will keep a record of all your transactions so that you can go back later and figure out your cost basis on your cryptocurrency for tax reasons. Then if you sell cryptocurrency during the tax year, you can figure out what profits or losses you've had during the year, and whether gains are taxed as short-term or long-term, etc.
Crypto Trading Tax Reporting
If you're going to be doing a lot of crypto trading, it's a good idea to use an automated transaction tracking software like the one at CoinTracker.io.
CoinTracker can plug into the API for many of the biggest crypto exchanges (and accepts .csv imports from many others) and provide you with a report for your taxes at the end of the year.
It's free to use for the basic account (up to 25 transactions), and has a small fee if you are a more active trader with more transactions to report on. CoinTracker is definitely worth it if you're planning on doing a bit of crypto trading.
15 Most Popular Bitcoin And Crypto Investing Sites
Here is a list of some of the most popular cryptocurrency and Bitcoin sites. Most of them are crypto exchanges where you can buy or sell crypto. Some are crypto savings accounts, where you can earn interest on your cryptocurrency. Still others are brokerages or mobile apps that allow you to buy cryptocurrency. Most of them fall into one of these following categories.
- Exchanges: Cryptocurrency exchanges facilitate the buying and selling of cryptocurrency, as well as the storage of your crypto when you hold. Coinbase, Gemini and Kraken are examples of this.
- Brokerages: Some stock brokerages have started to allow investors to buy and sell a select few cryptocurrencies, in addition to stocks, bonds and mutual funds. Robinhood, Webull and eToro are examples of this.
- Apps: Some apps have added the ability to purchase and sell Bitcoin into their apps. Cash App, Venmo and Pei Cashback App fall into this category.
Let's take a look at some of the best options available.
Coinbase is one of the main cryptocurrency exchanges that I personally use, and if you're new to cryptocurrency world they're definitely one of the main ones I'd recommend giving a try. For advanced traders they have Coinbase Pro, which offers more tools for active traders.
Coinbase has over 43 million users in over 100 countries, and they claim to hold over 90 billion in assets, while facilitating over $450 billion in trades. When I counted earlier today they've got around 60 different tradeable cryptocurrencies that you can buy through their portal, including most of the big ones like Bitcoin, Ethereum, and Litecoin. They're definitely one of the bigger and more respected crypto exchanges in the business.
The exchange and mobile app also boast strong security with two-factor authentication, offline storage for a majority of client assets, and stronger security for long term crypto storage or time-delayed release through Coinbase Vaults. They boast that they have never been hacked.
Earn $5 in bitcoin for getting started on Coinbase!
- $5 new account bonus.
- Great for beginners.
- Strong security.
- Reasonable fees.
Disclaimer: Personalized $5 reward offer is displayed after account creation. Limited time offer and while supplies last. Offer available to new users who have not previously verified their identification. Offer not available to new users who were referred to Coinbase through the Referral Program or who have previously opened an account using different contact information. Coinbase may update the conditions for eligibility at any time, in its sole discretion. See Terms and Conditions.
Gemini is another crypto exchange that I currently have an account with and would recommend. It also has a strong reputation for being strong on security, and like Coinbase it has never been hacked.
Gemini was founded here in the United States by Cameron and Tyler Winklevoss (co-founders of Facebook predecessor), and is based out of New York. Since Gemini is based in New York the company follows their regulations, and is one of the few crypto exchanges available in New York.
Gemini currently has over 40 tradeable cryptocurrencies, including a few more obscure ones that have had popularity recently like DOGE coin.
The exchange also has a feature called Gemini Earn that allows you to earn interest on your unused cryptocurrency balances.
Sign up through our link below you'll get a $10 Bitcoin bonus once you've traded $100.
- $10 BTC bonus when you trade $100.
- Great security, never been hacked.
- Over 40 tradeable cryptocurrencies.
- Earn interest on your unused crypto.
Crypto.com is another outstanding cryptocurrency app. I have an account there because I wanted to buy a bunch of an obscure crypto that I thought had a chance of hitting it big, and they were one of the few exchanges that was carrying it at the time.
Based in Hong Kong, Crypto.com is one of the biggest and fastest growing crypto exchanges in the world. They currently offer over 90 cryptocurrencies worldwide, or 50+ if you're in the United States.
The Crypto.com app is offering a $25 referral reward in CRO (Crypto.com's in house cryptocurrency coin) if you sign up through our link. The reward is unlocked when you stake $400 CRO and obtain the Crypto.com Visa card (the card allows you to spend your Crypto and earn Crypto rewards, among other benefits).
The service has a pro account for advanced traders on the web as well. You can open an account on the Crypto.com exchange here. (Get a $10 bonus with $1000 in new CRO stake)
- $25 bonus in CRO for new app users.
- $10 Bonus for exchange users.
- Over 50 tradeable cryptocurrencies in U.S
- Great app, and advanced trading with Exchange.
BlockFI is a bit different from the sites already mentioned because while can you trade cryptocurrency pairs on their platform, it's main advantage is that users can earn interest on their crypto holdings.
If you're not looking to sell your cryptocurrency anytime soon you can put your crypto to work with BlockFi and earn up to 8.6% APY with a BlockFi Interest Account. Just fund your account with a wire or a crypto transfer of your choice, and starting earning interest.
BlockFi also has crypto backed loans. You can use your crypto as collateral and receive a loan in U.S. dollars, so that you don't have to sell your crypto. It should be noted that the there are rates of 3-9.3% and a required 2% origination fee, so it isn't cheap.
BlockFi currently supports Bitcoin, Ether, Litecoin, PAX Gold, USD Coin, Gemini Dollar and Tether for the BlockFi Interest Account, although there may be more in the future. Also, there are no ACH transfers of fiat currency currently.
BlockFi also recently released a rewards credit card that will pay your rewards in Bitcoin.
Get up to $250 in crypto bonus with a deposit of $25 or more in crypto. Click through our link below for details.
- Get up to $250 crypto bonus with a deposit of $25 or more in crypto.
- Earn up to 8.6% APY on select cryptocurrency.
- Crypto backed loans (so you don't have to sell).
Celsius Network is very similar to BlockFI in that users can earn interest on their crypto holdings.
Hold your cryptocurrency with Celsius and earn up to 13.99% APY (depending on which crypto). Just fund your account with a crypto transfer of your choice, or buy crypto through the app (ACH or debit card) and starting earning interest in-kind with the same crypto. .
Celsius also has crypto backed loans where you can use your crypto as collateral. Rates will vary depending on the percentage of your loan to value ratio. For example, if you have $100,000 in Bitcoin invested, for a 25% LTV you could borrow $25,000 for a 1% APR. For a 33% LTV it would jump to 6.95%, and 50% LTV would be 8.95% APR. So the lower percentage LTV loans will be a better deal.
Celsius Network currently supports and pays interest on over 30 cryptocurrencies including Bitcoin, Ethereum, Litecoin, Synthetix Network Token, Polygon, USD Coin, Gemini Dollar, DAI and Tether. They also have plans for more soon, including yearn.finance and Cardano.
Join Celsius Network using my referral code 136907dfb4 when signing up and earn $40 in BTC with your first transfer of $400 or more, after you hold it for 30 days.
Earn another $40 in BTC for a limited time when you enter promo code BTC40 in the app under "profile/promo codes" after you verify your account. Receive the bonus when you fund your account within 10 days of entering the code, and maintain a balance for 30 days without withdrawing.
- Use referral code 136907dfb4 when signing up and earn $40 in BTC
- Earn up to 13.99% APY on select cryptocurrency.
- Crypto backed loans (so you don't have to sell).
Kraken has been around for almost a decade, and is one of the original crypto trading platforms. They are also one of the most secure platforms for crypto currency trading, and have never been hacked.
Kraken is based in the U.S., and they currently offer 50+ cryptocurrencies for trading.
They also offer staking rewards on some coins, which can allow you to earn some interest on your crypto. Rewards are paid bi-weekly, and the amount you can earn varies by coin.
Kraken is also known for having fees that are extremely reasonable, more so than some of the other bigger platforms.
- An original crypto trading platform.
- Very secure, never been hacked.
- 50+ tradeable cryptocurrencies.
- Staking rewards on some coins.
eToro is brokerage and cryptocurrency trading platform that has been around for some time in Europe, but has more recently made crypto trading available in the U.S.
They platform is well suited to beginners because they have an easy to use $100,000 practice account so you can test out buying Bitcoin first without any risk.
They also have a cool "CopyTrader" system that allows you to copy the trades from other high-performing users on the platform. This is especially nice if you want to trade, but are a bit unsure of your strategy.
eToro is currently offering a $50 bonus for customers that purchase $1,000 worth of cryptocurrency through their platform. Click through the link below.
- 15+ cryptocurrencies available for trading.
- Easy to use platform.
- Free $100,000 practice accounts.
- Fees based on a spread can be a bit high.
Binance is one of the largest global cryptocurrency exchanges. The company was founded in 2017 in China, and is now based in Malta. They do have operations in the United States and Singapore as well.
According to CoinMarketCap, Binance is the largest crypto exchange globally in terms of trading volume and weekly site visits.
The Binance.US site was launched in September 2019 in San Francisco, and currently offers 50+ cryptocurrencies on the U.S. version of the site, although they do have some hard to find coins available on their service like NEO and DOGE.
There are 7 states not yet supported, so check the site to make sure you are able to open an account.
Once you open a Binance.US account you'll be able to refer your friends to open an account and earn referral commissions when they buy crypto.
- Largest global crypto exchange.
- 50+ cryptocurrencies available.
- Relatively low fees compared to some exchanges.
Robinhood is one of the best places to trade Bitcoin and Ethereum, if you want to do it with no commission. Not only are there no commissions, but they make it easy to buy crypto through the Robinhood Crypto account in the Robinhood app.
Robinhood currently only supports a few currencies on their platform. Tradeable cryptocurrencies currently include Bitcoin, Bitcoin Cash and Ethereum. They also only support certain states.
One of the downsides of buying Crypto with Robinhood is that there is currently no option to withdraw your cryptocurrency to a wallet elsewhere. You can only buy your crypto there, and then sell it, but you can't transfer it. For some who plan to just buy and hold that isn't a big deal, and the no commission more than makes up for it. For others it should be something to consider.
When you open an account with Robinhood you'll get a free stock! Click through our link below.
- Get a free stock when you open an account.
- No commission to buy or sell Bitcoin.
- Bitcoin, Bitcoin Cash and Ethereum available.
- Easy to use Robinhood interface.
Webull is another great place to buy cryptocurrency with no commissions to buy or sell. They currently offer seven cryptocurrencies for trading: Bitcoin, Dogecoin, Bitcoin Cash, Ethereum, Litecoin, ZEC and XLM.
Buying through the app works just like buying a stock. Your search for the crypto name or symbol (Like Bitcoin or BTC), and then place your order. The crypto is held at Apex Crypto, so it is technically separate from Webull, while being done through their app. You also can't transfer or withdraw your crypto to another exchange or wallet, you can only buy or sell from within the app.
While not being able to transfer to an external wallet may be a deal-breaker for some, for those who plan to just buy and hold for a while, it probably isn't a big deal. I personally have some Bitcoin and Ethereum that I've purchased through Webull and that I plan holding for a while.
Open an account with Webull you'll get a free stock worth up to $1600! Get your free stock, sell it and then buy some crypto!
- Get free stock worth up to $1600.
- No commission to buy or sell crypto.
- Buy Bitcoin, Dogecoin, Bitcoin Cash, Ethereum, Litecoin, ZEC and XLM.
- Easy to buy, sell crypto.
SoFi Active Investing
SoFi is a company that offers everything from student loan refinancing and bank accounts to investing and insurance products. They are a one-stop shop for all your financial needs. Among the needs you can now satisfy is buying Cryptocurrency.
SoFi active investing offers five cryptocurrencies for trading at the current time. Bitcoin, Ethereum, Litecoin, Bitcoin Cash, and Ethereum Classic.
As with Robinhood, Webull and a few other stock brokers you just purchase cryptocurrency in their investing app just like you would any stock, bond or mutual fund. Search for one of the supported currencies and buy it. As with other brokerages, however, their crypto system is closed, and you're not able to transfer crypto to an external wallet at this time.
Open a new account through our link and buy $10 worth of any tradeable cryptocurrency within 7 days and you'll get $10 in Bitcoin!
- Get $10 in Bitcoin with $10 crypto purchase.
- Charges markup of 1.25% on crypto transactions.
- Offers Bitcoin, Ethereum, Litecoin, Bitcoin Cash, and Ethereum Classic.
- Easy to purchase crypto.
Bitcoin IRA is a bit different from some of these other sites in that they allow you to invest in cryptocurrency, but inside of a tax advantaged account.
When you normally invest in cryptocurrency your gains or losses on crypto are taxed on short-term and long-term gains. When you invest inside of an IRA your taxes are deferred or tax-free in the Roth.
You can also earn interest on your crypto by lending it out via Bitcoin IRA. You can earn as much as 6% interest on your crypto and cash.
There is a $3,000 minimum for a transferred IRA, or $100 with a new IRA and a regular contribution. There are also fees associated with this type of an account Check out the site for full details on what those are currently.
- IRA provider that offers cryptocurrency investing.
- Earn interest on your crypto.
- Roth, SEP, Traditional IRAs.
- Offers Bitcoin, Ethereum, Zcash, Ripple, Litecoin, Bitcoin Cash, and Stellar Lumens.
Coinmama is another cryptocurrency exchange that offers instant Bitcoin purchases, while offering quick account setup and verification.
You can use a credit or debit card to buy one of ten different cryptocurrencies, or you can sell your Bitcoin in exchange for fiat currency. (They don't currently offer ACH transfers in the U.S.)
Coinmama is not a wallet provider, so when you buy crypto you'll need to provide the address of your pre-existing wallet, either with another online provider like Coinbase or Gemini, or with a mobile, desktop or other hardware wallet.
- Cryptocurrency delivered direct to any wallet.
- Quick account setup.
- Quick order delivery.
- High limits and many payment options.
Hodlnaut is another cryptocurrency lending platform where they allow you to earn a good amount of interest on your crypto holdings. You can think of it as a crypto savings account of sorts.
The site was launched in 2019 and is based out of Singapore. They offer variable interest on deposits in Bitcoin, Ethereum, Dai, USD Coin and Tether cryptocurrencies.
The service doesn't charge any fees on deposits, but there is a fee on withdrawal which can change depending on market conditions.
Open an account through our link below and get $20 when you deposit at least $1,000!
- Get $20 free when you deposit $1,000.
- Earn up to 10.5% interest on cryptocurrency holdings.
- Pays interest on Bitcoin, Ethereum, Dai, USD Coin and Tether deposits.
- No minimum deposit.
Blockfolio is a multi-featured cryptocurrency app that allows you to track your crypto portfolio (even coins held with with other exchanges), purchase new investments with no fees or stay on top of prices for over 10,000 cryptocurrencies.
Over 6 million people use Blockfolio to buy, sell and track their favorite cryptocurrencies, and it's available in over 200 countries.
Open an account through our link and trade $10 worth of crypto and you'll get a free coin!
- Earn free crypto on every trade over $10.
- No trading fees.
- Track your entire cryptocurrency portfolio.
- Track prices of over 10,000 cryptocurrencies.
Bisq is a decentralized exchange where you can buy and sell bitcoin for fiat (or for other cryptocurrencies).
The service is run on a peer-to-peer network and open source desktop software that you download to your computer.
There is no registration required, and one of the service's biggest selling points is how it is a privacy first service, with no identity verification required. Your data is stored locally on disk, not in the cloud or on a third party provider.
The site for Bisq has some good video tutorials to walk you through how it all works.
- Decentralized, privacy first platform.
- No registration required.
- Run the software on your desktop.
- Buy cryptocurrency, while protecting privacy.
Investing In Bitcoin Is Easier Than Ever
The cryptocurrency exchanges, brokerages and apps are growing in number, features and functionality.
While our favorites may change as time goes on, for now we believe the best trading platforms are the ones listed above.
Check out all of the crypto currency trading options again below, along with any promos that may be available for each one. Most of them have a crypto or cash bonus available, or bonuses for referring family and friends.
$5 new account bonus
$10 BTC bonus when you trade $100
$25 bonus in CRO coin
Up to $250 crypto bonus with a deposit of $25 or more in crypto.
Sign up using referral code 136907dfb4 and earn $40 in BTC with your first transfer of $400 or more!
20% of trading fees for users you refer
20% of trading fees for users you refer. Earn 40% if you hold 500 BNB.
Earn 1000 Stellar Lumens once someone you refer completes a trade.
15% of trading fees for users you refer.
$20 bonus with initial deposit of at least $1,000.
Get $10 in Bitcoin with your first crypto trade of $10 or more.
Get a free share of stock.
Get free stock worth up to $1600.
$50 bonus with purchase of $1,000 in cryptocurrency.
Free crypto coin with $10 purchase
Have any of your own favorite cryptocurrency trading exchanges, apps or sites? Favorite wallets or other crypto tools? Tell us what they are in the comments!