The world of cryptocurrency has surged in popularity over the past few years, as more and more people buy into it. But what are altcoins? How can you buy them? And how do you sell them?
We then get practical by showing you how to use exchanges like Binance and Paxful for buying and selling coins—including step-by-step guides on each stage of the process. After that, we’ll discuss some of the risks involved with investing in altcoin trading before concluding with our overall thoughts on whether or not this type of investment is right for you.
In this guide, we’ll answer all these questions and more. We’ll explain what altcoins are and how they differ from bitcoin (and other cryptocurrencies) before taking a look at where you can buy altcoins online.
What are altcoins?
Altcoins are cryptocurrencies other than Bitcoin. They are also known as “cryptocurrencies”, “digital coins”, or “crypto tokens”. The word “altcoin” is a portmanteau of “alternative” and “coin”.
Altcoins represent a wide range of digital assets (i.e., virtual currencies). Some examples include Ethereum, Litecoin, Ripple, Monero and more than 22,904 (as of March 2023) other altcoins available today on various exchanges around the world.
Where Can I buy altcoins?
There are several ways to buy altcoins. You can do so from crypto exchanges, brokers and ATMs.
- Crypto exchanges: These are online platforms where users can buy and sell cryptocurrencies for other digital currencies or fiat money. Some of the best-known crypto exchanges include KuCoin, Binance, Coinbase Pro (formerly GDAX), Kraken and Bitstamp.
- Crypto brokers: These offer a similar service to crypto exchanges but typically don’t accept fiat currency deposits like bank transfers or credit cards; instead they only allow deposits using cryptocurrency wallets like those provided by Bitgo etc.. Examples include eToro or Xtrade.
How do I buy altcoins?
You can buy altcoins such as Luna crypto on exchanges, which are websites that allow you to trade cryptocurrency for other cryptocurrencies. There are many different types of exchanges, but most follow the same basic steps:
Step 1. Decide on a percentage of portfolio allocation for the investment
Before you start buying altcoins, it’s important to have a plan for how much of your portfolio will be allocated to this new asset class. This decision will depend on several factors:
- The size of your overall portfolio
- Your risk tolerance and investment time horizon
- How much research time you can devote to learning about the different cryptocurrencies available
Step 2: Shop around for the most promising coins
Before you start buying altcoins, it’s crucial to do thorough research on the various options available in the market. You can use websites like CoinMarketCap and CoinGecko to explore different coins and their market capitalization, trading volume, and historical data.
Evaluate the potential of each altcoin based on factors such as:
- Team and developers: Assess the credibility and experience of the team behind the project.
- Use case: Analyze the real-world applications and potential demand for the coin.
- Technology: Understand the underlying technology and how it differentiates from other projects.
- Community support: Check the size and engagement of the community supporting the project.
- Partnerships: Look for any strategic partnerships or collaborations with established companies or organizations.
Step 3: Exchange fiat currency for cryptocurrency
Once you’ve selected an exchange, the next step is to sign up for an account. You’ll need to provide some basic personal information and create a password (or use 2FA). Once your account has been created and activated, it’s time to start trading! The steps here are similar across all exchanges: choose which cryptocurrency pair (e.g., BTC/ETH) or fiat currency pair (e.g.USD/ZEC) that interests you.
Then enter how much money you want to buy or sell. Specify whether or not there are any fees associated with doing so; review everything before confirming; wait for confirmation via email/SMS message from both parties involved in completing said transaction (this may take several minutes); then enjoy watching those altcoins appear in their new home.
Step 4: Pick the right exchange
You’ve got the right idea. You’re ready to buy some altcoins, but where should you go? There are many exchanges out there, and each has its own pros and cons.
Here are some things to consider when choosing an exchange:
- Reputation: The best way to determine if an exchange is reputable is by reading reviews from other users. It’s also helpful if they have been around for a while (as exchanges come and go). A good reputation means that customers have had positive experiences trading with them in the past, which means fewer problems when trying something new like buying altcoins.
- Fees: This one’s pretty straightforward–the lower the fee percentage per trade or deposit/withdrawal transaction size, the better! An exchange with low fees will save money over time thanks to reduced overhead costs associated with running their business (and thus passing those savings onto us).
Step 5: Pick a currency pair
The last step is to pick a currency pair.
Several exchanges offer hundreds of different cryptocurrency trading pairs. The most popular are:
- BTC/USDT (Bitcoin / Tether) – This is the most common pairing because it allows you to trade fiat money (dollars or euros) for cryptocurrency at any time without waiting for bank transfers or other delays. You can also use USDT as a stable store of value in times when bitcoin’s price fluctuates too wildly for your liking.
- ETH/BTC – Ethereum has become one of the top altcoins since its launch in 2015 due to its smart contract functionality and ability to host dApps on top of its blockchain network. If you are looking for the ETH price in a specific currency pair, you can use websites like CoinMarketCap or CoinGecko to find the desired pair.
Step 6: Execute the trade
Once you’ve entered all the relevant information and clicked “Buy,” the next step is to wait for your transaction to be confirmed by the network. This may take anywhere from a few seconds to several hours, depending on how busy the network is, so be patient!
Once your transaction has been confirmed, you can check its status by clicking on it in your account history or going here: https://blockchain.info/tx/[transactionhash]. This page will show you whether or not it was successful; if so, congrats! Your altcoins are now in your possession and ready for use (or trading).
Step 7: Check that the altcoins are already in the wallet
Access your cryptocurrency wallet where you store your coins. Once you’ve accessed your wallet, look for the section that displays your balances. This section usually lists all the cryptocurrencies you own, including altcoins, and their respective quantities.
If you have many cryptocurrencies in your wallet, use the search function (if available) to find specific altcoins. Once you’ve added the altcoin to your wallet, it should display the balance if you have any.
How does a trader sell their altcoins?
To sell your altcoins, you must first go to the exchange where you bought them. Once there, go to the sell tab and select the altcoin(s) that you want to sell. Enter in how many coins or tokens are being sold and confirm that transaction by clicking “Sell” or “Confirm”.
Are altcoins the right investment for crypto users?
The altcoin market is not as liquid and stable as bitcoin. In other words, it’s harder to buy or sell altcoins than it is to buy or sell Bitcoin. This means you may have to wait longer for your order to be filled when you want to exchange an altcoin for another cryptocurrency or fiat currency (e.g., USD).
Altcoins are also more volatile than Bitcoin; their prices will fluctuate more frequently over time because there isn’t enough trading volume yet on exchanges like KuCoin, Coinbase Pro or Binance (compared with Bitcoin). If this sounds scary, don’t worry.
The volatility of cryptocurrencies tends to even out over time–but in the meantime, if you’re looking at purchasing some new coins from a friend who wants cash now but doesn’t mind waiting until tomorrow before selling them back again then just remember that those coins could potentially lose value during those 24 hours which means less profit for both parties involved!
Finally, investing in altcoins involves greater risk compared with simply buying BTC since many projects fail altogether after raising funds through ICOs (Initial Coin Offerings) while others simply fail due to lackluster development teams who don’t do anything except talk about big ideas without ever actually delivering anything meaningful.
Conclusion
In conclusion, buying and trading altcoins can be an exciting and potentially profitable venture, but it’s essential to approach it with caution and knowledge.
Before investing in any altcoin, conduct thorough research on the project, team, technology, and potential use cases. Stay informed about market trends and news.
By following these guidelines and exercising patience and discipline, you can navigate the world of altcoins and potentially achieve success in this dynamic and fast-paced market.