How to get into cryptocurrency: a beginner’s steps
To get into cryptocurrency, open a verified exchange account, fund it, buy, then move coins to a wallet you control. Compare fees and limits first.
Vahe HakobyanEditor-in-chief
Updated Oct 5, 20264 min readFact-checked
On this page
- Compare exchanges for coins, payment methods, and limits before depositing.
- Move coins to a self-custody wallet to control your private keys.
- Keep records of every buy, sell, and transfer for the IRS.
- Use two-factor authentication and guard your seed phrase offline.
Opening an account takes a government ID and a phone or computer. US exchanges must follow federal anti-money-laundering rules and verify your identity, so you cannot trade until that check finishes. Once verified, you can deposit US dollars and buy cryptocurrency. The Bitcoin blockchain records every transaction in a public ledger, so activity is traceable.
What you need before you start
Before you deposit any money, compare at least two exchanges. Look at which coins they support, how you can pay, and any account limits. The bankruptcy of FTX in November 2022 showed that an exchange can fail, so check whether the company is registered and how it holds customer funds.
How to get into cryptocurrency
Once your account is verified, fund it with a bank transfer or debit card. Then place a buy order for the cryptocurrency you chose. After the order fills, you have a choice: leave a small amount on the exchange for future trades, or move the rest to a self-custody wallet. A self-custody wallet gives you the private keys, which means you control the coins.
- 1Fund your accountConnect your bank account or debit card and check for deposit fees. Bank transfers may take a few days to settle.
- 2Place a buy orderEnter the dollar amount and select the coin. Review the order details before you confirm.
- 3Wait for settlementCard purchases usually settle quickly. Bank transfers can take longer, so check your balance before trading again.
- 4Set up a walletChoose a self-custody wallet and write down the seed phrase on paper. Store it offline, away from your computer.
- 5Move coins to custodySend a small test amount first. Then send the rest to your wallet address.
- 6Learn before large transfersBefore using Bitcoin for any serious transaction, take time to inform yourself. Use a new Bitcoin address for each incoming payment to protect your privacy.
After buying: records and account safety
Keep a record of every purchase, sale, and transfer. The IRS treats cryptocurrency as property, so each sale or trade can create a taxable gain or loss. Store these records with your tax files. For security, turn on two-factor authentication and use a unique password. Do not share your seed phrase or passwords with anyone.
Frequently asked questions
No. You can buy on an exchange and leave the coins there. But if you want full control, set up a self-custody wallet before you move larger amounts.
Use the exchange's account recovery process, which usually involves verifying your identity again. If you had two-factor authentication, you may need your backup codes. Exchanges can freeze accounts, so act promptly.
Most blockchain transactions cannot be reversed. As bitcoin transactions accumulate confirmations, each one makes them increasingly difficult to reverse, so the coins usually stay at the wrong address. Contact the receiving exchange or wallet provider, but recovery is not guaranteed.
