How to Buy Cardano ADA: A Clear Guide for Beginners
Table of Contents
- How to buy Cardano (ADA) in 4 steps
- Selling Cardano
- Cardano ADA Price Fluctuation
- Financial Conduct Authority (FCA) Warnings
- How to Invest in Cardano (ADA)
This section provides a brief overview of the topics covered in the article. The first topic explains how to buy Cardano (ADA) in four simple steps. The second topic discusses selling Cardano. The third topic highlights the price fluctuations of Cardano ADA since its launch in 2017. The fourth topic sheds light on the repeated warnings issued by the UK’s financial watchdog, the Financial Conduct Authority (FCA), to potential investors. The final topic explains how investors can invest in Cardano (ADA) if they understand the risks involved. It is important to note that investing in cryptocurrencies carries significant risks, and investors should only invest what they can afford to lose.
How to Buy Cardano (ADA) in 4 Steps
1. Choose an Exchange
To buy Cardano (ADA), investors need to use a crypto exchange to swap their fiat currency for cryptocurrency. An exchange is a website or app that crypto buyers and sellers use to make trades. There are many exchanges to choose from, including Coinbase and eToro.
When choosing an exchange, investors should consider what payment methods are accepted, the fees associated with each payment method, whether the exchange offers an integrated wallet, whether the investor can transfer to an external wallet, whether there are fees for transfers out, and what currencies can be traded. Investors should also check if their preferred exchange offers Cardano ADA.
2. Choose a Payment Method
Investors need to decide how they’re going to pay for their Cardano ADA. They should check if there are any fees associated with the payment method chosen. Credit card payments on some exchanges are typically classed as cash advances, which means they attract interest at a much higher rate of interest than a normal purchase, and it is charged from the point the transaction is made, regardless of whether the cardholder pays off their balance in full when it comes due. Taking on debt to invest in crypto is generally not advisable. Some UK exchanges accept PayPal, but it’s a minority – and those that do may charge a fee for the privilege.
3. Place an Order
Once an investor has created and funded their account, they can navigate to the Cardano ADA page in the app or website and enter the amount they’d like to invest.
4. Choose a Storage Method
Most exchanges come with an integrated wallet in which investors can store Cardano ADA. However, investors may prefer to hold their assets in a third-party wallet. Investors could use either a ‘hot’ wallet, which uses online storage, or a ‘cold’ wallet, which is an offline storage device such as a flash drive or a hard drive. The former is more vulnerable to hackers, but offers investors support in accessing their Cardano ADA if they lose the access codes. Cold wallets are inherently more secure because they’re not connected to the web and can’t be reached by hackers. If an investor loses the access codes to their assets in a cold wallet, however, there’s no customer support to help recover them, which means access to the currency could be lost.
Selling Cardano
Investors can sell their ADA for fiat currencies or other cryptocurrencies, depending on its current market value. To sell ADA, investors need to access the ‘sell’ option within their crypto exchange’s app or website. They can then input the amount they want to sell and the type of currency they want in return.
Before confirming the trade, investors will see a preview of the transaction, including any fees paid to the exchange. Once satisfied, they can confirm the trade, and a confirmation email will be sent. The investor’s account balance should update accordingly.
It is important to note that cryptocurrency is unregulated in the UK, and the Financial Conduct Authority has warned investors about the risks of investing in cryptocurrency. Investors risk losing all their money without any possibility of compensation.
Overall, selling Cardano is a straightforward process that can be done through a crypto exchange. However, investors should be aware of the risks involved in investing in cryptocurrency.
Frequently Asked Questions
Cheapest Way to Buy Cardano
The most cost-effective way to purchase Cardano is by using a cryptocurrency exchange and paying through a direct bank transfer. This method does not attract additional fees, unlike using a credit or debit card, which usually carries a fee of around 3%. It is important to note that using a broker instead of an exchange may also incur additional charges.
Buying Cardano with Another Cryptocurrency
Yes, Cardano can be bought with other cryptocurrencies such as Bitcoin or Ethereum. To trade a cryptocurrency for ADA, one should navigate to the Cardano page within their exchange’s app or website and select the “buy” option. Payment can then be made using cryptocurrency assets already in the account.
Buying Cardano with a Credit Card
It is possible to buy Cardano with a credit card, but it is not recommended. In addition to the 3% fee, the transaction will be treated as a cash advance by the card issuer, attracting a higher rate of interest on the balance from the day of the transaction. It is generally not advisable to take on debt to purchase an asset that could potentially decrease in value.
Cardano vs. Bitcoin
Cardano and Bitcoin are vastly different in terms of size and application. While Bitcoin has a market capitalisation of £400 billion, Cardano’s is significantly lower at £7.1 billion. Bitcoin is limited to handling payments alone, whereas Cardano enables smart contracts and can host decentralised apps (dApps).
Cardano’s Total Supply
Cardano has a limited supply of 45 billion ADA coins, similar to Bitcoin’s upper limit of 21 million coins. Currently, more than 33 billion of those 45 billion coins have been issued. New coins are issued whenever a new block of transactions is added to the Cardano blockchain. At the current rate, it could be decades before Cardano hits its supply limit.
