How Can You Buy and Sell Cryptocurrency?

How can you buy and sell cryptocurrency?

If you’ll recall from the previous chapter, the price of Bitcoin has fluctuated a great deal. Similarly, the prices of all cryptocurrencies tend to move up or down with time. The extent of the change may be different, but there’s no denying that there are changes in the prices of these currencies. 

And you can take advantage of this volatility to gain some additional funds. To do this, you need to understand how to buy and sell cryptocurrency. Only then can you buy a currency at a low and sell it at a high, or use any of the many other trading or investing strategies to gain from the price fluctuations. 

Can you buy and sell cryptocurrency on the same day?

The short answer? Yes.

You can buy and sell cryptocurrency on the same day. This is what traders refer to as intraday crypto trading. And it is very much like intraday stock trading. You can buy and sell the same cryptocurrency within 24 hours to profit from short-term price movements. 

How to Buy Cryptocurrency?

If you have never purchased cryptocurrency before, you may have more questions than answers about the process involved. To make things easier for you, we’ve broken down the process of buying cryptocurrency into some easy steps. Take a look at them below.

Step One: Choose an Exchange

Cryptocurrencies, like stocks, are traded on exchanges. There is no centralized body that helps control the trades. So, the first step to buy any cryptocurrency is to select an exchange to carry out the trade on. Here is where the bulk of purchases and sales happen. Compare the different exchanges available and look at the services offered. Check customer reviews and get to know the reliability of the customer support team.

Then, sign up on the exchange of your choice. Make sure that you keep your login credentials safe.

Step Two: Connect Your Exchange to a Payment Option

Once you’ve signed up on an exchange, you need to set up your account and add a convenient payment option. This makes it easier to pay for your purchases. As a rule of thumb, it’s best to add payment options that are quick and convenient, so you can make the purchase without too much of a delay. This way, the purchase is made before the value of the cryptocurrency fluctuates too much.

For instance, storing your debit or credit card details helps you make a quicker buy. So do UPI channels. On the other hand, paying via an internet banking portal that requires an OTP could take a longer time to complete the transaction. This may not be ideal for volatile currencies. 

Step Three: Place an Order

After adding a payment method, you need to place your order. To do this, you need to know the following particulars clearly.

• The kind of order you wish to place (market, limit, intraday, etc.)
• The cryptocurrency you wish to purchase
• The quantity of cryptocurrency you wish to buy

Step Four: Store the asset safely

Merely buying the cryptocurrency of your choice is not enough. You need to ensure that it is stored safely, especially if you are planning on buying and holding over the long term. Here is where a cryptocurrency wallet can be useful. You can choose between cold wallets and hot wallets. 

Alternate Ways of Buying Cryptocurrency

Although they are not very popular, there are also other ways to buy cryptocurrencies. These options may not have as many transactions as exchanges though, since the volume of purchases and sales is low. Nevertheless, it’s always a good idea to know your options. Take a look at the alternate ways to buy crypto.

• Cryptocurrency ATMs
• Peer-to-peer exchanges
• Brokerages

How to sell Cryptocurrency?

You can sell cryptocurrency via the same platform that you purchased it from. Again, an exchange is the best way to sell your holding quickly. The process is also similar to the purchase. However, in some exchanges, since there may be limits on the amount of funds you can withdraw on a daily basis, the funds from a large sale may not be entirely available to you right away. Look for these terms and conditions before you choose an exchange.

Summing up

Now that you know the ways to buy and sell cryptocurrency, you can focus on learning about how to buy and sell cryptocurrency for profits. If you are already familiar with stock trading and investing, this should not be very different. At the end of the day, stocks and cryptocurrency are both traded via exchanges, isn’t it? 

A quick recap

• You can buy and sell cryptocurrency on the same day. This is what traders refer to as intraday crypto trading. 
• To buy crypto, you need to choose an exchange, set up a payment method, place your order and store the currency safely.
• You can also buy and sell crypto via brokerages, P2P exchanges or crypto ATMs.