Diving into the world of cryptocurrencies?
Sometimes, the sheer number of options can make you feel like you’re lost in a maze. But fear not! You’ve come to the right guide to learn the ins and outs of buying cryptocurrency with ease and confidence.
We’ve got your back, and our top pick for diving into the crypto pool is eToro.
But wait, there’s more!
We have a treasure trove of information waiting for you in our all-encompassing crypto hub page.
Contents
Introduction
Buying cryptocurrency
Step 1
Choose an exchange or broker
Step 2
Open an account and verify it
Step 3
Fund the account with the deposit
Step 4
Select a cryptocurrency
Step 5
Buy cryptocurrency
Buy cryptocurrency: what are the benefits of investing in crypto?
When it comes to investing, there are many different options. You can invest in stocks, bonds, real estate, etc.
But one option you may not have considered is investing in cryptocurrency.
So what are the benefits of investing in cryptocurrency?
- Cryptocurrencies are still a relatively new asset class
This means there is a lot of potential for growth. As more and more people learn about cryptocurrency and start investing in it, prices are likely to rise.
- Cryptocurrencies are a highly volatile asset class
Understand that there is potential for high returns, but there is also high risk. If you’re the type of investor who is looking for high-risk, high-return investments, cryptocurrency may be an interesting option for you.
- Cryptocurrency is a decentralized asset class
This means that it is not subject to the same regulations and scrutiny as traditional assets like stocks and bonds. This can be seen as a good or bad thing, depending on your investment philosophy.
- Cryptocurrency is a global asset class
This means that it is not tied to any one country or economy. This can be seen as a good thing as it means your investment is not exposed to the same risks as investments that are tied to a specific country or economy.
- Cryptocurrency is a digital asset class
This means that it is not a physical asset, such as property or a stock certificate. This can be seen as an advantage as it means there are no storage or transportation costs associated with it.
These are just some of the advantages of investing in cryptocurrency. If you are looking for an investment with potential, then cryptocurrency may be a good option for you.
The most important question to ask yourself is how do you want to invest in cryptocurrency?
You need to ask yourself this question because there are two different ways to invest in cryptocurrencies.
On the one hand, there is the “buy and hodl” strategy, and on the other hand, there is active trading in cryptocurrencies.
To make your decision easier, we have explained both options in more detail below.
Where can I buy cryptocurrency?
In the meantime, there are various options in front of you to invest in cryptocurrencies. You can:
- Buy and sell cryptocurrencies on an online cryptocurrency exchange;
- CFD trading with online trading platform;
When you buy cryptocurrencies online through an exchange or broker, you can choose from a variety of payment methods, such as: buying BTC with PayPal, bank transfer or by card.
Each payment method has advantages and disadvantages. Bank transfer usually takes a few days, credit cards have higher fees, and PayPal is only offered by a few trading platforms.
To make your choice a little easier, we’ve created step-by-step instructions that allow you to easily and securely invest in cryptocurrencies.
1. Choose an exchange or broker to buy cryptocurrencies
Choosing between an exchange or a broker depends on your preferences, trading experience and desired cryptocurrencies. Beginners may find brokers to be more affordable, while experienced traders may appreciate the advanced features of exchanges. Always conduct thorough research before choosing a platform, and be sure to store your cryptocurrencies securely.
Why choose a broker:
- Convenience for beginners: If you are new to cryptocurrency trading and prefer a platform with an intuitive interface and simpler trading options, a broker may be more suitable.
- Limited trading activity: If you plan to buy and hold cryptocurrency with minimal trading activity, the broker may be a good choice as it often provides an easy purchase process without the need for advanced trading tools.
- Traditional Assets: If you want to trade cryptocurrencies alongside traditional assets like stocks or commodities, brokers like Libertex and Skilling offer a more comprehensive investment platform.
Crypto brokers are particularly suitable for those who like to bet on rising and falling prices. Unlike a crypto exchange, here you don’t own real crypto, but trade certificates, options, features or CFDs.
If you prefer this type of trading, then with a crypto broker you are in exactly the right place.
Trading CFDs on cryptocurrency through a crypto broker is excellent for beginners because it is very easy, and you are buying cryptocurrencies from a regulated and trusted provider.
What are the fees for buying CFDs on cryptocurrencies?
If you want to trade cryptocurrencies, all trading platforms charge fees. Exchanges and brokers are funded through these fees. Libertex is highly recommended as the provider charges very low fees when buying bitcoin.
If you want to buy BTC on Libertex, you pay fees of min. 0,03%.
Overall, the fees at Libertex are very low compared to other brokers where you can purchase cryptocurrencies. In addition, there are no extra costs for deposits and withdrawals.
Payment methods with brokers and exchanges
If you want to buy cryptocurrency from an exchange or broker, you have various payment methods available.
A deposit via credit card, PayPal or another online payment provider, or an online bank transfer is ideal as it is available in your account almost immediately.
On the other hand, with regular bank transfers, it can sometimes take up to seven business days for your deposit to arrive.
Common deposit and withdrawal methods include:
- PayPal
- Mastercard
- VISA
- Bank transfer
- Skrill
Regulation and verification of cryptocurrency brokers and exchanges in Europe
As a consumer, you need to make sure that you only buy cryptocurrencies from regulated providers. This is the only way to make sure your money is in safe hands.
We strongly advise you not to use unlicensed crypto exchanges – in the worst case, deposited money or cryptocurrencies disappear.
The licensed provider must comply with legal requirements and as a consumer you can be sure that your deposited money is kept safe.
Our test winner eToro is regulated in the EU (Cyprus).
This means that it is a safe choice for European customers as well, due to EU jurisdiction.
Why choose an exchange:
- Advanced trading: If you are an experienced trader or want to access more advanced trading options such as limit and stop orders, margin trading or futures, the exchange may be more suitable.
- If you want to invest in a wider range of cryptocurrencies, exchanges typically offer a more extensive list of tokens than brokers.
- Lower fees: If minimizing fees is a priority, exchanges often charge lower fees than brokers, making them a more cost-effective option for frequent trading or large transactions.
In summary, you should choose a broker if you are new to cryptocurrency trading, plan limited trading activity, or want to trade cryptocurrencies alongside traditional assets. On the other hand, consider an exchange if you’re looking for expanded trading options, a wider selection of cryptocurrencies, or lower fees.
Top crypto exchanges:
Hybrid
ecoinomy rating:
9.5/10
| Max leverage | 2:1 CFD |
|---|---|
| Trading fees | Spread 1% |
| Licences | FCA 7973792 + AFSL #491139 + CySEC 109/10, |
| Cryptocurrencies | 79+               |
| Payment methods | PayPal, debit and credit cards, Skrill, Neteller, SEPA, WebMoney |
| Number of users | 25.000.000+ |
Exchange
ecoinomy rating:
9.1/10
| Max leverage | 20:1 |
|---|---|
| Deposit fees | By card 1,8%; minimum deposit 15 EUR |
| Trading fees | 0.1% |
| Licences | |
| Cryptocurrencies | 650+   |
| Payment methods | Crypto, Visa, MasterCard |
| Number of users | 30.000.000+ |
Exchange
ecoinomy rating:
9.0/10
| Max leverage | 100:1 |
|---|---|
| Headquarters | Dubai |
| Deposit fees | Card 2% |
| Trading fees | 0,075% |
| Cryptocurrencies | 370 |
| Payment methods | Crypto, Visa, MasterCard |
| Number of users | 3.000.000+ |
Top crypto cfd brokers:
Broker
ecoinomy rating:
9.2/10
| Maximum leverage | 2:1 |
|---|---|
| Minimum deposit | 100 EUR |
| Trading fees | from 0,0003% |
| Licence | CySEC 164/12 |
| Cryptocurrencies |                          |
| Payment methods | SEPA, PayPal, Skrill, Neteller, Visa, Mastercard |
| Number of users | 2.200.000+ |
Broker
ecoinomy rating:
9.1/10
| Maximum leverage | 20:1 |
|---|---|
| Minimum deposit | 100 EUR |
| Trading fees | 1% |
| License | CYSEC, FSA |
| Cryptocurrencies | 51+    |
| Payment methods | SEPA, VISA, MasterCard, Trustly, Skrill, Neteller, Klarna, Swish |
| Number of users | unknown |
Broker
ecoinomy rating:
8.7/10
| Max leverage | 2:1 |
|---|---|
| Min deposit | 100 EUR/USD/GBP |
| Transaction fees | 0,2 – 2% |
| Licences | Central Bank of Ireland |
| Cryptocurrencies | |
| Payment methods | PayPal, SEPA, VISA, MasterCard |
| Number of users | 300.000+ |
Users can choose from a number of crypto exchanges in Europe. We have therefore selected three particularly recommended providers.
In particular, eToro is a long-established, well-respected and extremely reliable provider. Moreover, with it, banks in Europe do not create obstacles for deposits and withdrawals, as is the case with some crypto exchanges.
Accordingly, the provider is also the winner of our test.
Binance, Bybit and eToro are recommended cryptocurrency exchanges. Binance and eToro are particularly impressive as they have a good selection of other cryptocurrency exchanges.
Using eToro as an example, we’ll show you how you can buy your first cryptocurrency.
In fact, registering, depositing and buying cryptocurrencies with the provider is very easy. Let’s explain step by step how to buy your first cryptocurrency.
2. Open an account and verify it
74% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work, and whether you can afford to take the high risk of losing your money.
Cryptoasset investing is highly volatile and unregulated in some EU countries. No consumer protection. Tax on profits may apply.
To be able to buy cryptocurrency, you need an account in the first place. To do this, register on the eToro website.
All you need is to enter your basic details to open the account:
You will then receive a confirmation link to the email address you have provided.
Once you have completed the eToro registration, you will have access to the crypto exchange’s trading dashboard overview.
3. Make a deposit
Once you log in to eToro, you will see multiple currency pairs that you can trade with.
If you are already logged in, you will see the Deposit Funds button on the bottom left:
You need to select the amount you want and the payment method. The most popular deposit methods are PayPal, Visa, MasterCard, bank transfer, UnionPay, Skrill, Neteller. According to your preferred payment method you can choose between USD and EUR. If you deposit BGN there is almost no difference, but if you deposit from USD or EUR method it is recommended to choose the same currency from the menu.
4. Choose a cryptocurrency
Numerous readers ask us which cryptocurrency to purchase.
We cannot answer this question very easily. However, there are some cryptocurrencies that promise good returns even over 2023. This probably includes the important digital currency, Bitcoin.
Ethereum is also an exciting coin that benefits in particular from the growing importance of DeFi. The Ethereum 2.0 update is coming, however, so there will likely be some big changes. Chainlink and its Coin LINK are also particularly promising and are already among the big winners in 2020. The current situation should continue to improve through the import of external data on blockchains like Ethereum.
But other exciting projects such as IOTA, Tezos or EOS are also attractive investments in the crypto sector.
In our experience, no one can say which cryptocurrency will perform best in the coming months or years.
In particular, the top 20 cryptocurrencies are made up of solid projects and teams behind them with good future prospects.
Here are a few of those projects we’d like to introduce to you here:
(Note: we try to describe the projects as neutrally as possible. The author may have invested in some of the cryptocurrencies listed.)
Bitcoin (BTC)
Bitcoin (BTC) is the first blockchain-based cryptocurrency on the market. The Bitcoin protocol was published in 2009 by an unknown person under the pseudonym Satoshi Nakamoto. At that time you were able to purchase 1 bitcoin for less than a dollar.
In December 2017, the general public was “introduced” to the bitcoin cryptocurrency for the first time. The large influx of new funds led to bitcoin’s highest rating of just under $20,000. In April 2021, on the other hand, if you wanted to buy bitcoin, you had to pay almost $70,000 for a whole bitcoin.
Ethereum (ETH)
Ethereum (ETH) is a decentralized platform for smart contracts.
It was launched in 2015 by Vitalik Buterin and was originally conceived as a “world computer”. In the future, contracts can be signed without notarization by the blockchain. The ERC-20 standard provides the ability to create cryptocurrencies on the Ethereum Blockchain network, which led to the big ICO hype in 2018. The price of Ethereum peaked in 2021. Back then, you could buy Ethereum for just under $5,000.
Ripple (XRP)
Ripple (XRP) is considered the cryptocurrency of banks. It is an open source protocol that allows XRP tokens (Ripple’s currency) to be delivered worldwide at extremely low prices. Ripple has been around since 2012 and has consistently ranked in the top 5 largest cryptocurrencies since then. An all-time high was reached in January 2018, when an XRP token was worth $3.40. That gave Ripple a market capitalization of over $143 billion.
IOTA
IOTA (MIOTA) is a relatively new project, launched in 2016. IOTA is no longer based on a blockchain, but on a DAG called Tangle. IOTA was the first cryptocurrency to open a charitable foundation in Germany. The IOTA Foundation is headquartered in Berlin as of 2018. IOTA is set to become the currency of machines in the Internet of Things (IOT). This is made possible by free transactions and extremely high scalability. IOTA does not need mining, which extremely reduces the power consumption of this cryptocurrency. The highest price reached the IOTA exchange rate in December 2017, when 1 MIOTA was worth $5.25.
Cardano (ADA)
Cardano (ADA) is considered a major competitor to Ethereum. It was founded in 2015 to research and solve the current difficulties of cryptocurrencies by scientists. Since then, an entire ecosystem has emerged around Cardano, where many researchers and developers continue to explore cryptocurrencies. Shortly after the end of 2018, the highest price of a cryptocurrency was reached, namely $1.18.
5. Buy cryptocurrency
Once you’ve deposited and know which crypto you want to invest in, it’s time to make the actual purchase.
The dashboard provides an overview of all cryptocurrency pairs, such as ETH/USD (Bitcoin/USD), and also trade pairs for bitcoin, BNB and other cryptocurrencies.
To view the cryptocurrencies available for trading, go to “Trade Markets” – filter to “Crypto” and search for your desired cryptocurrency from the list.
Now think about how much you want to buy a cryptocurrency for. And also whether you want to use leverage (multiplier).
Congratulations , once you click on “Open Trade” you have bought your first cryptocurrency!
Selling a cryptocurrency in the crypto exchange
Of course, you can also sell cryptocurrencies. We’ll show you how it’s done:
- Click “Discover”
- Now enter the cryptocurrency you purchased in the search bar at the top.
- You can also click on “Crypto”.
- Click on the blue “Trade” button in the top right corner.
- Click “Sell”
- Enter the desired amount and click “Open Trade”.
- You have now sold the cryptocurrency for the amount you entered.
Fees for buying and selling cryptocurrencies at eToro
| Deposit | Free |
| Buying Bitcoin | 1% spread |
| Transfer BTC to etoro wallet | 0.5%, minimum fee $1, maximum fee $50 |
| Withdrawal | $5 |
| Fee after 12 months of inactivity | $10 per month |
Detailed review in our eToro reviews.
Is it too late to buy cryptocurrency?
Is now the time to invest in cryptocurrencies?
In fact, one big advantage is the bear market of 2018:
After which many projects that have not been developed or whose technology has no application have completely disappeared from the market. Accordingly, the teams that managed to create a community and partner with larger companies prevailed.
In short, these are the projects that can add value in the real economy.
In fact, we have already built a fundamental foundation in the crypto sphere that has the perspective to be invested by banks or hedge funds.
Institutional investors are also waiting to diversify into cryptocurrencies.
Financial research shows that adding 5-10% in cryptocurrencies is currently a good strategy for any investor’s portfolio.
For one, there is currently virtually no correlation between traditional asset classes (such as gold, DAX or real estate funds) with crypto.
And so we can achieve diversification beyond even the best diversified portfolios.
On the other hand, cryptocurrencies still have an extremely asymmetric risk profile given their small market capitalization.
The small observed cycles from the pre-momentum stage of development show that even without institutional cash flows they can easily reach 100 times higher capitalization.
Already known?
That’s what you would have earned if you invested in cryptocurrencies in 2016:
An investment of 250 EUR would be worth 12,892.85 EUR today.
An investment of 1,000 EUR would be worth 51,583.40 EUR
Useful tips when investing in cryptocurrencies
1: Established cryptocurrencies
Only invest in cryptocurrencies that are solid and already established projects with a good development team.
Investing in Ethereum, Ripple or Cardano makes a lot more sense with proven teams in the past that know how to partner well with companies outside of the crypto world.
2: Diversify
Every healthy portfolio has a degree of diversification. If a sudden event destroys the value of a cryptocurrency, your remaining coins will still be able to make up for the potential loss.
3: Fundamental Analysis
Don’t just watch the progress charts, keep an eye on the technical developments and partnerships of your projects. Especially for a long investment horizon, tracking the evolution of your cryptocurrency is extremely important.
4: Rational decisions
Avoid FOMO and panic at FUD. FOMO (fear of missing out) and FUD (fear, uncertainty and doubt) are two terms derived from emotions in human psychology. An important point is that you should always try to make rational investment decisions. Emotions haven’t won anyone anything in trading!
5: Strategy-planning
Follow a strategy. Whether you want to buy cryptocurrencies through daily trading or invest for the long term – plan in advance how you want to act if your goals are achieved. Especially with rapidly rising prices, as we’ve seen many times with cryptocurrencies in the past, it can be easy to get greedy and want to get more and more out of your investments.
6: Crypto Tax
Cryptocurrency trading is considered a business in this country. This means that every one of your transactions should be taxed on your income.
Frequently asked question about how to buy cryptocurrency?
Is it legal to buy and trade cryptocurrency in Europe?
Yes, it is legal to buy, sell and trade cryptocurrencies in Europe. However, they are not recognised as legal tender and cryptocurrency transactions are subject to taxation.
What deposit methods can I use to buy cryptocurrency in Europe?
Common payment methods include bank transfers, credit or debit cards and SEPA transfers.
How can I buy cryptocurrency in Europe?
To buy cryptocurrency in Europe most profitably, you can international exchanges that support deposits in euros, such as eToro, Binance or Bybit. You can also use a licensed and regulated broker such as Libertex, Skilling or Avatrade.
Are there any fees associated with buying cryptocurrency in Europe?
Yes, fees vary depending on the platform you choose and the payment method you use. Some exchanges charge a percentage of the transaction amount, while others may have flat fees. Always research the fees associated with your chosen platform and payment method.
How do I store my cryptocurrency once I have purchased it in Europe?
You can store your cryptocurrency in a digital wallet provided by the exchange or platform you used to buy it. For greater security, consider using a personal hardware or software wallet. Hardware wallets like Ledger and Trezor provide a high level of security, while software wallets like Exodus or Trust Wallet are more affordable but slightly less secure.
Are there any taxes on cryptocurrency transactions in Europe?
Yes, cryptocurrency transactions are taxable in Bulgaria. Profits from cryptocurrency trading are considered taxable income and you must declare your profits when filing your annual tax return. Consult a tax advisor or the National Revenue Agency for more specific information on tax rates and regulations.
Can I use cryptocurrency to pay for goods and services in Europe?
Although cryptocurrency is not recognised as legal tender in Bulgaria, some businesses may accept it as a form of payment. However, the use of cryptocurrencies for everyday transactions is still limited. Always check with the merchant beforehand. For example, at skapto you can buy a burger by paying with bitcoin.
Author: Gianluca Lombardi
Gianluca is the editor-in-chief of this site. A finance graduate, he is an active trader who has tested all trading platforms and knows all their secrets. Technology is his passion; he spends much of his free time in the metaverse. Gianluca loves learning new things, researching, discussing and writing about technology, especially when it comes to cryptocurrency and blockchain technology.
