Buying your first cryptocurrency

Brandon Goldman
Dec 22, 2017 · 4 min read

In the last month, over $313 Billion has entered the cryptocurrency market. In this time, many cryptocurrency coins have skyrocketed in value — some up several hundred percent.

“I’ve made so much money on Bitcoin, you’ve got to buy some!” -everyone

You’ve heard about it on the radio, the news, and even at the family dinner table. Investing in cryptocurrency is not only easy, but proven to be profitable for most investors who have entered the market any time since the beginning of 2017.

Of course, this is not financial advice! Cryptocurrency is an unregulated, extremely volatile market. It’s not like a traditional stock market — markets are unpredictable and can swing high and low 24/7. But, who’s to say a little risk isn’t worth the reward?

What’s all the hype about?

Signing up for an exchange

An exchange is a platform that allows you to buy or sell cryptocurrencies by exchanging one currency into another, such as US Dollars (USD) exchanged for Bitcoin (BTC).

Chances are, you are looking to trade your US Dollars for coins like Bitcoin, Ethereum, and Litecoin.

If you’re looking to purchase Bitcoin or Ethereum, you have two great options:

Only Coinbase supports Litecoin (as of December 2017).

Coinbase vs. Gemini

Gemini does not support credit card or debit card purchases, and has a user interface that is a bit harder to use. However, it has much lower fees which makes it appealing to those investing larger amounts of money (you pay 0.25% on Gemini compared to the 1.5%+ on Coinbase).

Ultimately the decision is yours. I tend to recommend Coinbase to those who are willing to pay a few extra bucks in fees for a great user interface and mobile app. If you use my referral link on Coinbase, you and I both get $10 in free Bitcoin when you purchase at least $100 in Bitcoin.

I’m on the exchange… now what?

“Bitcoin is soooo expensive, I can’t afford one!”

Luckily, you don’t have to purchase entire coins. You can buy fractions of a coin — whether it be a hundredth of coin or perhaps even a thousandth! You can invest in a coin with as little as $1. However, deciding which coin to buy can prove to be much more challenging. I’ve outlined a brief overview of each of the three coins supported on either Coinbase or Gemini below.

Bitcoin (BTC)

The original cryptocurrency. First mentioned in 2008 by its anonymous creator, “Satoshi Nakamoto,” Bitcoin introduced a number of key ideas that have underpinned several other cryptocurrencies since. This includes the blockchain, the public ledger that enables peer to peer transactions to be completely decentralized — meaning no third parties can get between you and the person you’re trying to send money to.

Litecoin (LTC)

Litecoin is meant to be faster than Bitcoin. Where it takes ten minutes to log a Bitcoin transaction into the blockchain, it takes just two and a half minutes for Litecoin to do the same. Many make the comparison of Bitcoin to Gold, and Litecoin to silver.

Ethereum (ETH)

Introduced in 2013, on the surface Ethereum was created to run what are called smart contracts. Imagine you want to rent a bike at a bike rack in the middle of your city. The bike waits for people like you to send money to it before the lock on the rack unlocks. This transaction goes through the bike’s “smart contract” which has the ability to accept your money and then trigger the lock to unlock once it sees you have paid. It’s like the perfect harmony of the Internet of Things with cryptocurrency!

Congrats! You are now holding a piece of the future!

In a future article, I plan to explain some of the ways you can store your investment so that they can be safe and sound for the future!

Brandon Goldman

Written by

Software Engineer | Cryptocurrency Enthusiast