How to Buy Your First Cryptocurrency
You'll need: a valid ID, email address, phone number, and a payment method (bank account or debit card).
Why January 2026 Is a Great Time to Start
The crypto market has matured significantly since 2021. After the 2022 crash and 2024-2026 recovery, regulation is clearer, exchanges are safer, and tools are easier to use. Over 420 million people now own crypto worldwide.
Bitcoin hit $69,000 in November 2021, crashed to $15,500 in November 2022, then recovered to $42,000-58,000 range through 2026-2026. This volatility is normal. Your first purchase is about learning, not getting rich quick.
How Much Does It Cost to Start?
You can start with as little as $10 on most exchanges. Here's what beginners typically spend:
- $25-50 - Learning amount to understand the process
- $100-250 - Modest starter position
- $500-1,000 - Serious beginner allocation
Never invest money you can't afford to lose. Crypto is high-risk. Many beginners lose money by panic selling during dips or buying at peaks.
Choosing the Right Exchange
Not all exchanges are equal. The wrong choice can mean higher fees, poor support, or security risks. Here's a detailed comparison:
| Exchange | Best For | Trading Fee | Deposit Fee | Verification Time |
|---|---|---|---|---|
| Coinbase | Total beginners | 0.60% | ACH free, card 3.8% | 5-15 minutes |
| Kraken | Security-focused | 0.26% | ACH free, wire $10 | 10-30 minutes |
| Binance.US | Low fees | 0.10% | ACH free, card 4.5% | 15-60 minutes |
| Gemini | Easy interface | 0.35% | ACH free, wire $10 | 10-20 minutes |
For your first purchase, Coinbase or Kraken are the safest choices. Binance.US has the lowest fees but a steeper learning curve.
Never use exchanges that: promise guaranteed returns, skip KYC verification, have no phone support, or offer "free crypto" promotions. These are scams.
Choose a Cryptocurrency Exchange
An exchange is where you'll buy, sell, and trade crypto. For beginners, we recommend:
- Coinbase - Most beginner-friendly, higher fees
- Kraken - Great security, moderate fees
- Binance - Lowest fees, more complex interface
Start with Coinbase if you're completely new. You can always move to other exchanges later.
Create Your Account
Visit your chosen exchange and sign up:
- Click "Sign Up" or "Get Started"
- Enter your email address
- Create a strong, unique password (16+ characters)
- Verify your email by clicking the link they send
Never reuse passwords! Use a password manager to generate and store unique passwords.
Complete Identity Verification (KYC)
Exchanges are required by law to verify your identity. You'll need to:
- Enter your full legal name and address
- Upload a photo of your government ID (passport or driver's license)
- Take a selfie for facial verification
- Wait for approval (usually 5-30 minutes)
KYC (Know Your Customer) prevents money laundering and fraud. It's required on all major exchanges.
Enable Two-Factor Authentication (2FA)
This is critical for protecting your account:
- Go to Security Settings
- Choose "Authenticator App" (not SMS!)
- Download Google Authenticator or Authy on your phone
- Scan the QR code
- Save your backup codes somewhere safe
Without 2FA, hackers can steal all your crypto if they get your password. Use an authenticator app, NOT SMS.
Add a Payment Method
Connect a way to deposit money:
| Method | Speed | Fees |
|---|---|---|
| Bank Transfer (ACH) | 3-5 days | Free or low |
| Debit Card | Instant | ~3% fee |
| Wire Transfer | 1-2 days | $10-25 |
For your first purchase, a debit card is fastest. For larger amounts, use bank transfer to save on fees.
Buy Your First Crypto!
Time to make your first purchase:
- Click "Buy" or "Trade"
- Select the cryptocurrency (Bitcoin is a good start)
- Enter the amount in your currency (e.g., $50)
- Review the fees and total
- Confirm the purchase
Only invest what you can afford to lose. Start with $25-100 to learn how everything works.
Secure Your Crypto
Congratulations! You own cryptocurrency. Now protect it:
- Small amounts - Keep on exchange (if it has good security)
- Larger amounts ($500+) - Move to a personal wallet
- Long-term holdings - Use a hardware wallet
Learn more in our Wallet Guides.
Common Mistakes Beginners Make
Learn from others' errors. These mistakes cost beginners thousands:
1. Buying at Market Tops
When Bitcoin hit $69,000 in November 2021, millions of beginners bought in. Within 12 months, it was down 77%. Don't chase pumps. Buy during quiet periods, not when everyone is talking about crypto.
2. Keeping Everything on Exchanges
FTX collapsed in November 2022. Customers lost $8 billion. If you hold more than $500, move it to a personal wallet. Exchanges can freeze accounts, get hacked, or go bankrupt.
3. Forgetting to Enable 2FA
Over $3.8 billion was stolen from crypto users in 2026. Most thefts happened because users didn't enable 2FA. It takes 3 minutes to set up and can save you from total loss.
4. Using SMS for 2FA
SIM swapping attacks let hackers steal your phone number and bypass SMS codes. Always use an authenticator app (Google Authenticator, Authy) instead of SMS.
5. Not Saving Backup Codes
If you lose your phone and don't have backup codes, you can't access your exchange account. Write them down. Store them separate from your phone.
6. Panic Selling During Crashes
Crypto crashes 30-50% regularly. Bitcoin dropped 83% in 2018, 73% in 2022. If you sell during crashes, you lock in losses. Only invest money you won't need for 3+ years.
What to Do After Your First Purchase
You bought crypto. Now what?
Track Your Investment
Use a portfolio tracker like CoinGecko or CoinMarketCap. Link your exchange with API keys (read-only) to auto-track holdings. Don't obsess over price every hour.
Set Up Price Alerts
Most exchanges let you set alerts. Get notified if your crypto drops 20% or rises 50%. This prevents emotional decisions.
Learn About Wallets
If you bought more than $250, research wallets. Software wallets (MetaMask, Trust Wallet) are free. Hardware wallets (Ledger, Trezor) cost $60-150 but are safest for large amounts.
Start Dollar-Cost Averaging
Instead of one big purchase, buy $50-100 every week or month. This averages out price swings. If Bitcoin is $45,000 today and $38,000 next month, you get a better average price.
Never Share Your Details
No legitimate exchange will ever ask for your password, 2FA codes, or recovery phrases. If someone contacts you claiming to be from support, it's a scam.
Understanding Fees
Exchanges make money from fees. Know what you're paying:
| Fee Type | What It Is | Typical Cost | How to Minimize |
|---|---|---|---|
| Trading Fee | Charged when you buy/sell | 0.10%-0.60% | Use maker orders, higher volume |
| Deposit Fee | Charged when adding money | Free-4.5% | Use ACH/bank transfer, not card |
| Withdrawal Fee | Charged when moving crypto out | $1-25 | Withdraw larger amounts less often |
| Network Fee | Paid to blockchain miners | $0.50-$20 | Choose low-fee times, batch transfers |
| Spread Fee | Hidden markup on price | 0.5%-2% | Use advanced trading, not simple buy |
Example: Buying $100 of Bitcoin on Coinbase with a debit card costs $3.80 deposit fee + $0.60 trading fee = $4.40 total. You only get $95.60 of actual Bitcoin. Using ACH transfer costs just $0.60 total.
Tax Implications
In most countries, buying crypto isn't a taxable event. But selling, trading, or spending crypto triggers capital gains tax. Keep records of all purchases. You'll need them when filing taxes.
In the US, if you hold crypto less than 12 months before selling, you pay short-term capital gains (your income tax rate). Hold longer than 12 months and you pay long-term rates (0%-20%, usually lower).
Frequently Asked Questions
Can I buy partial Bitcoin?
Yes. You don't need to buy a whole Bitcoin ($45,000+). You can buy $10 worth, which equals about 0.00022 BTC. All cryptocurrencies are divisible.
How long does verification take?
Most exchanges verify accounts in 5-30 minutes. During busy periods (market pumps), it can take 2-48 hours. Apply during business hours for faster approval.
Is my money safe on an exchange?
Reputable exchanges (Coinbase, Kraken, Gemini) are generally safe for amounts under $500. They use cold storage, insurance, and security audits. But exchanges can be hacked or freeze accounts. For larger amounts, use a personal wallet.
What if I forget my password?
Exchanges have password reset via email. But if you enabled 2FA and lost your phone without backup codes, you'll need to contact support with ID verification. This can take days or weeks.
Can I cancel a purchase?
No. Crypto transactions are final. Once you confirm the buy, you own that crypto at that price. There's no "undo" or refund button.
Should I buy Bitcoin or other coins?
Start with Bitcoin. It's the most established, least volatile (relatively), and easiest to understand. After you're comfortable, explore Ethereum and other projects. Avoid obscure coins until you know what you're doing.
What's the best time to buy?
There's no perfect time. Markets move 24/7. Dollar-cost averaging (buying the same amount weekly) works better than trying to time the market. Most traders who try to time entries perform worse than simple DCA.