When investing in cryptocurrency, it is important for the user to choose a reliable exchange, not to overpay due to high commissions, and take into account many more aspects. However, even one mistake can lead to loss of money. This can be avoided by following simple rules.
The achievement of a new high by the bitcoin rate above $20,000, the crisis caused by the pandemic and quarantine attracted new users to the cryptocurrency market. But the problems remain the same – a novice, and even an experienced investor, can easily lose money when buying cryptocurrency.
The reason for this may be their own mistakes or scammers. To reduce such risks, we prepared instructions and learned advice from industry representatives.
- Exchanges
The easiest and most convenient way to buy cryptocurrency is to do it directly on the exchange. Today, many trading platforms allow you to deposit funds through electronic payment systems or directly from bank cards. Thus, the user can replenish the balance on his exchange wallet with dollar or another currency, and then buy cryptocurrency with these funds.
Or you can buy cryptocurrency immediately, in one step. To do this, the user needs to select the “buy Bitcoin” option on the exchange, select which asset he wants to purchase, and place an order. Then you will need to transfer funds to the account offered by the trading platform. When the money is transferred, digital coins will appear on the user’s exchange wallet.
Exchanges charge fees for their services. On each individual site, their size may be different, but, as a rule, it is 2-5%. It depends on the method of replenishment and on the platform itself. Therefore, before replenishing an exchange wallet, you can check the size of commissions on several exchanges and choose the most profitable option. This will save 1-2% of the amount that will later be invested in bitcoin or other altcoin.
- How not to lose money when buy cryptocurrency through exchanges?
Not all exchanges can be trusted. There is always a risk of using the services of a dubious site that was created by scammers. To avoid this and not lose funds, there indicators that can help you make the right and safe choice.
- The publicity of the exchange .
- The opportunity to get acquainted with the owners of the platform and its team is one of the indicators that the company has nothing to hide. This also includes the presence of additional interaction with users through social networks, which is constantly supported.
- Exit scams — when a team abandoned a project and hid with client funds — happened primarily to exchanges that adhered to complete anonymity.
- Registration and license of the exchange
This is another element of the company’s transparency. In addition, the country of registration itself can say a lot, since the activity of the site must comply with the relevant legislation.
- Site life
The presence of fresh news, updates and new products indicates that the company is set to develop business in the long term.
- User support
The work of technical support, the speed of responses and the real solution of problems are also important, and sometimes play an important role in preventing fraud.
- Experience
The probability of a scam from an exchange that has been operating for more than a year is significantly reduced. In addition, over the years experience has been accumulated, including anti-fraud practices.
- Partners
Cooperation with large and well-known companies also testifies to the integrity of the exchange. For example, when connecting any payment system, the exchange undergoes a thorough legal check from the opposite side.
- Compliance with anti-money laundering requirements
Although identity verification (KYC) and anti-money laundering measures are often perceived ambiguously in the crypto community, their presence on the site speaks of the desire of the exchange to work in the legal direction. They, in particular, help prevent hackers from withdrawing funds after being hacked on another exchange.
- Ease of withdrawal
It is not necessary to bring the entire planned amount to the site at once. It is quite reasonable to first test the work on it, get acquainted with the functionality, security measures, as well as the possibilities of withdrawing funds and its implementation in practice.
- Exchangers
Another way to acquire cryptocurrency is through special exchange services. Exchangers allow you to buy and sell many popular cryptocurrencies for dollars and other currencies. You can pay for the operation in various ways, for example, from electronic payment systems, bank cards, in cash through ATMs.
Exchanges are a less convenient and more risky way to buy cryptocurrency . There is a risk of using the services of scammers or making a mistake when making a transaction that will cost all the money invested.
But there is also a significant plus: among the exchangers you can find a service that offers the most favorable rate or the lowest commissions. Their size, as a rule, starts from 2% and can reach 10%.
You can choose the most favorable rate using services for monitoring exchangers. They collect data from many exchange sites and allow you to rank them according to the most favorable rate, reviews and other parameters.
Before using the exchanger, you should decide where you will transfer the purchased cryptocurrency. It can be an account on the exchange or an over-the-counter wallet. Accordingly, they need to be created before proceeding to the purchase of cryptocurrency.
- Exchangers work as follows:
1.On the site of the exchanger, you choose the asset you want to purchase and the payment method.
2.Specify the amount for which you want to buy cryptocurrency. It is better to specify round values, e.g. 10 dollars, so as not to make a mistake when sending funds to the exchanger, otherwise you can lose money.
3.Specify the address of the wallet where the cryptocurrency will go. You can view it in your personal account on the exchange or in the OTC wallet menu.
4.Confirm purchase order.
5.Transfer funds to the account offered by the exchanger. On many services, after transferring money, you need to click the “I paid” button. It is important not to forget to do this, otherwise the service will not understand that funds were transferred to it and, accordingly, will not send you the cryptocurrency.
When your funds reach the exchanger, it will transfer the cryptocurrency to the address you specified. This operation usually takes 10-15 minutes, but in some cases it can take up to an hour.
VERY IMPORTANT . When you use an exchange, it is important to indicate the exchange address of the exact cryptocurrency you are buying. If, for example, you purchase Bitcoin, and indicate the Ethereum wallet address in the application, the funds will be irretrievably lost, and it is impossible to cancel such an operation after it has been processed.
- How not to lose money when buying cryptocurrency through exchanges?
The risk of losing funds using exchangers is high. You may mistakenly purchase assets at a price significantly higher than the market price, or pay an extremely high commission. The most dangerous thing is to use the services of a service launched by scammers. With great certainty, this will lead to the loss of all funds.
- There some tips that will help you not to lose money when using exchangers:
–Do not use the first available exchanger
If you make an exchange through the first exchange office found in the search engine, the risk of losing funds is high. But there are especially many fake services in the Telegram messenger, which attract with their convenience. Try to use only websites of trusted services with a long-term reputation.
–Check all data before confirming the operation
When making transactions, it is important to remember that in many payment systems they are non-refundable. If you send funds to the wrong address, they are likely to be lost.
-Check reviews
If you are exchanging for the first time, be sure to check the reviews of the exchange office where you decided to buy or sell cryptocurrency. and monitoring of exchange offices are suitable. If the exchanger offers rates significantly higher than the market ones, then these are most likely scammers.
“When choosing an exchange office, please be sure to pay attention to the reviews of other users, the status of the online support operator, the amount of reserves, as well as the regulations of the exchange office,”
Sometimes there are delays and errors even in large exchange offices with a good reputation. The first thing to do in this case is to write to the service support, usually there is an online chat and email for this. If you do not promptly respond to your request or refuse to go to a meeting, you should find an exchange office in the catalog of any major monitoring service and open a claim there.
If the service is conscientious and there really is some kind of misunderstanding, the funds will be promptly paid or returned in accordance with the regulations, Services value their reputation on large-scale monitoring, and administrators, having received a notification about a user’s complaint, are interested in resolving it as soon as possible.
