How To Buy Crypto: A Beginner's Guide From Nash
October 5, 2023

How to Buy Crypto: A Beginner’s Guide

Semi-abstract, stylized illustration depicting the process of a person solving a problem. In this case, how to buy Crypto as a beginner.

Navigating Crypto To Buying Your First Tokens

Cryptocurrency offers a new way to invest, transact, and store value. If you're new to this exciting digital frontier, you're not alone. Many beginners are eager to explore the world of Cryptocurrencies, but it can seem daunting at first. To buy Crypto feels like it should be hard. This guide is designed to help you embark on your Crypto journey and buy your first Crypto with confidence.

TL;DR: How To Buy Crypto For Beginners

  1. Choose a wallet
  2. Understand key Crypto security concepts
  3. Create and secure an account (don’t forget to save your 12-word seed phrase!)
  4. Buy Crypto
    • Connect a fiat to Crypto ramp with your non-custodial wallet or centralized wallet account 
    • Choose your token and amount 
    • Click buy! 
  5. Confirm the tokens are in your wallet and view the transaction on a block explorer

The Basics: What Is Cryptocurrency?

Cryptocurrency is a digital asset or virtual money that uses cryptography for security. Three characteristics define “money.” It is a unit of account, a medium of exchange, a store of value. Unlike traditional currencies issued by governments (fiat), digital currencies operate on decentralized networks based on blockchain technology. Key terms include:

  • Blockchain: A distributed ledger that records all transactions across a network of computers, ensuring transparency and security. Blockchain transactions are immutable and cannot be changed. 
  • Wallet: A digital tool for storing, sending, and receiving Cryptocurrencies. When you buy Crypto, this is where tokens are stored.
  • Bitcoin (BTC): The first and most well-known Cryptocurrency, often referred to as "digital gold."
  • Altcoins: Any Cryptocurrency other than Bitcoin, including Ethereum (ETH), Polygon (MATIC), and Avalanche (AVAX).
  • Keys: Alphanumeric codes required for signing and executing blockchain transactions. There are two types: Private Keys and Public Keys.
  • Seed Phrase: A 12 or 24 word representation of a Private Key.

Your First Steps in Crypto

1. Selecting a Crypto Wallet

The first step in your journey begins by choosing a Cryptocurrency wallet. You need to answer three questions: 1. Custodial or non-custodial Crypto wallet? 2. Which type of wallet? 3. Which Crypto wallet? 

Non-Custodial Crypto Wallet or Custodial Crypto Wallet 

Crypto wallets can be either custodial wallets or non-custodial wallets (also known as self-custody wallets). Which you choose has important implications. 

The main tradeoff is between security and ownership. 

In short, with a non-custodial Crypto wallet, when you buy Crypto you own and control your tokens. You control the Private Key and only you have access to your assets. You are also responsible for the security of your wallet and your assets. 

With custodial Crypto wallets, on the other hand, when you buy Crypto the organization that provides the wallet controls the assets stored there. Similar to traditional finance. If something goes wrong, the company shuts down, is sued, or is not trustworthy your assets can be lost.

For additional research, start with an earlier blog post called “Understanding the Difference: Custodial vs Non-Custodial Crypto Wallets.” 

Type of Crypto wallets

There are three types of Crypto wallet: software wallet, hardware wallet, and mobile wallet. Which is right for you is personal. 

How do you plan to use the wallet? Do you intend to buy and hold tokens long term, do you want to trade frequently? Are you interested in swaps or advanced trading tools? Do you want access to DeFi and the broader Web3 universe? 

Software wallets and mobile wallets offer more flexibility and access. Hardware wallets are more secure and better suited for long-term storage. 

The links above provide more detail when you’d like to learn more about each type. 

Which Crypto Wallet

There are hundreds, if not thousands, of Crypto wallets available to choose from. 

In the EVM world, self-custody Crypto wallets Include the Nash Wallet, MetaMask, Safe, Brave, Uniswap, Trust Wallet. Custodial Crypto wallets include Coinbase (they also distribute a non-custodial wallet), Binance, Gemini, BitGo, Anchorage Digital. 

Each offers different features, capabilities, functionality, accessibility, security. We’re biased, of course, our recommendation is the Nash Wallet. It is self-custody, has a registered fiat to Crypto ramp natively integrated, comes with DeFi by default, and connects to all WalletConnect supported protocols. 

That said, you should do a bit of research and select one that aligns with your needs and preferences. 

The great benefit of self-custody wallets is that you can always transfer your assets to another self-custody wallet in the future. And, if you choose a custodial solution, you can always transfer your tokens to a self-custody wallet later.

2. Securing Your Wallet

Security is paramount in Crypto. Your wallet is your digital vault and you must protect it. Whether you choose a self-custody Crypto wallet or custodial solution. 

Crypto will introduce you to a number of Web3 specific concepts and tools. You’ll also find many of the same security practices in Crypto that you do in Web2. Concepts like usernames, passwords, and 2FA. 

After you’ve chosen which Crypto wallet, and assuming it’s a self-custody Crypto wallet, security begins during wallet creation. At some stage of the flow you’ll be asked to save a seed phrase (12 or sometimes 24 words).

The seed phrase is critically important and requires special attention. It is literally the keys to your kingdom. Best practices include not storing it on a digital device, not saving it on anything connected to the internet, and never sharing it. More on this below.

You might be familiar with other key elements of security, while Crypto-specific ones might be new. Key terms and concepts:

  • Seed Phrase: The single most important security feature in Crypto. It is a mnemonic phrase that secures a Crypto Wallet. These 12 or 24 words allow you to transfer tokens to another wallet or recover them if your wallet is lost. A Web2 equivalent might be your password. 
  • Keys: Two types of keys are used for executing blockchain transactions: Private Keys and Public Keys (Address). They are alphanumeric codes for signing and executing blockchain transactions. Anyone can send or deposit tokens to a Public Key (Address). This is what you share when someone sends you tokens. A Private Key, on the other hand, is the underlying code beyond your seed phrase. If your Private Key is stolen, there is a good chance your Crypto assets are gone. For a more detailed explanation, see this write up on Private Keys from Investopedia.
  • Multi-Party Computation (MPC): A protocol that distributes transaction computation across multiple parties. Its most important benefit is that no single individual can see everyone’s data. This allows transactions to complete without ever sharing a Private Key. The link above points to Nash co-founders scientific paper on the topic. 
  • Login credentials: These are your username and password. Same concept as with Web2 accounts and secure these as you would any of your accounts. Use a strong password, don’t share them, enable 2FA, use biometrics on a mobile device. Without 2FA and/or biometrics enabled it is much easier for a malicious actor to gain access to your account. Examples include hacking, phishing, social engineering. 
  • Two-factor authentication (2FA): When possible, always use a third-party authenticator application. It is now too common for hackers to spoof text messages, emails, and phone calls. 
  • Biometrics: Facial recognition and, to a lesser extent, fingerprints are much more secure for accessing sensitive mobile apps.

More advanced Crypto/blockchain security concepts are for another blog post. E.g. cryptography, consensus, network security, decentralization, the role of validators and community, and staking. 

When considering custodial wallets, be aware that accounts are centralized at the organizational level. Thus, susceptible to all the same security challenges as Web2. Threats like cyberattacks, fraud, hacks, legal actions, nation-state actions.

3. Buying Your First Cryptocurrency

Acquiring your first Cryptocurrency token is a big step. It means venturing into a whole new world of uncharted territory. 

Selecting which Crypto to buy is a topic for another post. In short, it’s similar to any other investment. Research the projects, understand the goal, understand the tech, be honest about your risk tolerance, check the market capitalization. 

Your first experience investing in Crypto involves two steps. Subsequent purchases typically require only the second. 

Step 1: The Fiat to Crypto Ramp 

To buy Crypto, you first need to connect an external, fiat currency account. This could be a traditional bank, neo-bank, debit card, credit card, wire, or platforms like PayPal and Plaid. 

Every fiat to Crypto ramp, platform, Crypto exchange has their own set of integrations. Every geographic jurisdiction has their own requirements. Pay particular attention to the limitations you legacy finance institutions have implemented. Some are friendly to Crypto, others are hostile. 

Our recent blog post “Understanding Crypto Fiat Ramps” has  more information on fiat to Crypto ramps, 

Crypto wallets and apps make this step straightforward. Just follow the in-app prompts, go through the KYC, and link your source of funds. If you’ve ever made a legacy bank transfer or connected a traditional bank account to a platform like Plaid, you will be familiar with this process. Absent any issues, the process takes only minutes. 

“KYC” is an acronym for Know Your Customer. It is a required step to prove who you are and your ownership of the external account you chose to connect. 

KYC is a controversial topic. Also, a necessary step when connecting to a fiat to Crypto ramp or getting started with a Cryptocurrency exchange. Only compliant and/or regulated Crypto apps and platforms require KYC. It is a strong signal the App you chose does things the right way.  More info on this topic is available in the blog post linked above.  

Step 2: Making Your First Crypto Purchase

If you are an experienced investor, you might choose a trading platform with advanced features. E.g. limit orders, stops, technical analysis tools.  If you are new, a streamlined interface is less intimidating. 

With your funding source connected, and your platform selected, the buying (and selling) process is quick and easy. Let’s buy Cryptocurrency:

  1. Select the token you want to buy
  2. Input the amount in fiat currency 
  3. Review the quote 
  4. Click “Buy”
  5. Confirm the transaction was successful and the tokens are in your wallet
  6. It is also fun to view the transaction and all available information on a blockchain explorer

The Role of Nash: Simplifying Your Crypto Journey

Investing in Cryptocurrency and embarking on a Web3  journey can feel complex. Hopefully, the above illustrates that it is easy to buy Crypto. With the right tools, it is accessible. The Nash Crypto App and investment platform is designed to simplify each step and provide advanced features. 

  • Intuitive Interface: Nash is user-friendly, and delivers an easy-to-use interface for everything Crypto. Whether you are a Crypto newbie or DeFi degen, Nash is right for you. 
  • Compliance: Nash was the first Crypto Platform in Europe registered by the Financial Market Authority (FMA) of Liechtenstein and De Nederlandsche Bank N.V. (DNB) in the Netherlands.
  • Security Measures: Your security is Nash’s priority. The Nash Wallet is self-custody and includes security features such as Multi-Party Computation (MPC), address whitelisting, transaction blocking, and never shares your private keys when sending tokens. 
  • Self-Custody: Ownership and empowerment are key principles at Nash. Self-custody is in its DNA. The Nash Wallet is non-custodial which means only you can access your tokens. Nash can never access them. The Nash Exchange is fully decentralized. 
  • Complaint Fiat to Crypto Ramp: The Nash Fiat to Crypto Ramp makes transferring cash between traditional banks and Crypto fast and safe. Buy and sell Crypto. Move cash into Crypto, move cash out to your traditional bank. 
  • Fiat And Crypto: The Nash IBAN lets you do everything Web2 next to everything Web3. Nash IBAN accounts are registered in the Netherlands, fully compliant, and enabled by Modulr. Get instant SEPA transfers, direct deposit your salary, pay for services, track spending, make money transfers with an account owned by you.
  • DeFi by Default delivers all Web3: WalletConnect integration gives advanced users access to popular protocols and thousands of tokens. 
  • One-Click Access to Earning Interest. Nash Earn provides easy access to advanced DeFi yield generating opportunities. Simply select your preferred option and go.

A Beginner No More 

Cryptocurrencies offer new opportunities for financial growth and security. They open doors to the decentralized world of Web3, individual ownership, and empowerment. 

Buying Crypto and navigating the space as a beginner may seem daunting, but it's entirely achievable with the right guidance and tools. 

Nash is here to support you on your journey whether you're looking to invest, transact, dive into Web3, or simply learn.  

Welcome to the future of personal finance, where Crypto and traditional banking seamlessly coexist, and financial empowerment is at your fingertips.

To get started with Nash, click the QR code below (if you’re reading on mobile) or scan it (if you’re reading on desktop).

Feature illustration image by jcomp on Freepik

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Compliance and Registration

Nash was the first Crypto Platform in Europe registered by the Financial Market Authority (FMA) of Liechtenstein. Nash is also registered with the De Nederlandsche Bank N.V. (DNB).
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Industry Leading Security

Nash’s Crypto Platform and Investment App uses state-of-the art, audited security measures and is fully non-custodial.
What makes Nash so safe
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Rates may vary over time. Crypto-powered earnings on Nash are not covered by any deposit guarantee schemes like bank savings accounts and involve risks unique to the underlying technologies: (i) Exploitations of the smart contracts used; (ii) Forex fluctations between your national currency and the US dollar, which underlies crypto earnings assets; (iii) USD stablecoins losing their peg. 
Nash is a trademark of Neon Exchange Aktiengesellschaft. Neon Exchange Aktiengesellschaft is an exchange bureau registered with the FMA of Liechtenstein (TT Exchange Service Provider Nr. 261096 as defined by the Token- und VT-Dienstleister-Gesetz / TVTG, 3 October 2019)
Nash Exchange B.V. is registered with De Nederlandsche Bank N.V. (DNB) as a provider of crypto services. DNB conducts supervision and monitors Nash Exchange B.V.’s compliance with the Money Laundering and Terrorist Financing Prevention Act and the Sanctions Act 1977. Nash Exchange B.V. is not under the prudential supervision of DNB nor under business conduct supervision of the AFM. This means there is no supervision of financial requirements or business risks and no specific consumer financial protections.
Neon Exchange Aktiengesellschaft is a partner of Modulr Finance B.V., a company registered in the Netherlands with company number 81852401, which is authorised and regulated by the Dutch Central Bank (DNB) as an Electronic Money Institution (Firm Reference Number: R182870) for the issuance of electronic money and payment services. Your account and related payment services are provided by Modulr Finance B.V. Your funds will be held in one or more segregated accounts and safeguarded in line with the Financial Supervision Act – for more information please see this link.
Neon Exchange Aktiengesellschaft also provides fiat-crypto exchange services. These are separate and unrelated to the account and payment services you receive from Modulr Finance B.V.