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How do I buy Dogecoin? A Beginner’s Guide to Investing in DOGE

How do I buy Dogecoin? A Beginner’s Guide to Investing in DOGE

With thousands of coins available, those interested in purchasing cryptocurrencies may find it difficult to know what they are looking at. This is especially true when you look beyond the big names like Bitcoin (BTC) and Ether (ETH).

Meanwhile, Dogecoin (DOGE) has become something of a cryptocurrency darling. It entered the top ten cryptocurrencies by market capitalization after a rally in 2021. Many people became interested in purchasing Dogecoin after seeing the price increase in 2021.

So, where and how can you get your hands on some Dogecoin? Here’s an explanation of what DOGE is and how to buy it.

How do I buy Dogecoin?

The procedure for purchasing Dogecoin is straightforward. If you’ve previously purchased cryptocurrencies, purchasing Dogecoin will be similar. Despite being available on the majority of the largest cryptocurrency exchanges, Dogecoin is not as widely available as some of the more established coins, and you may need to find a new exchange or a new wallet to accommodate it. 

If you want to buy Dogecoin, you should first learn the basics: 

  • Locate a wallet that accepts Dogecoin. 
  • Look for an exchange that accepts Dogecoin. 
  • Finish your first Dogecoin transaction and deposit the coins into your wallet.

Finding a Dogecoin wallet

Before purchasing Dogecoin, you must first obtain a wallet. If you already trade cryptocurrencies, your existing wallet may suffice. However, if you are new to cryptocurrency or your current wallet does not support Dogecoin, you will need to find a cryptocurrency wallet to complete the transactions.

A crypto wallet can be either a software programme or a piece of hardware. You can even make paper wallets to store and safeguard your cryptocurrency. Whatever wallet you choose, the goal is to store your private keys and facilitate transactions. 

If you’re looking for the fundamentals of different types of cryptocurrency wallets, software wallets are usually more convenient and free. Hardware wallets, on the other hand, are thought to be more secure, but they require an initial investment and are less convenient for people who conduct a lot of transactions. 

There are numerous wallets available for those looking to purchase Dogecoin, including both software and hardware wallets. It is important to note, however, that different wallets may provide different features and levels of security. Whether you choose a software or hardware wallet, you should conduct research to ensure that you are using a crypto wallet that is secure while also providing the features you require.

How to choose an exchange to buy Dogecoin

Dogecoin may be gaining popularity, but it is still only available on a few exchanges. If you want to invest in Dogecoin, you’ll need to find an exchange that accepts the coin and is legally operating in the jurisdiction where you live. 

While there are several exchanges that may offer Dogecoin for trading, locating the best one may take some time. You don’t want to settle for the first Dogecoin exchange you come across. Take the time to assess your needs and investigate exchanges to find the best one for you.

Make a list

The first step is to compile a list of Dogecoin exchanges. You can do this by looking for exchanges and seeing if they have the coin available for trade. 

Once you’ve compiled a list of Dogecoin exchanges, check to see if they offer to trade in your country, and if they do, make sure they’re doing so legally. It’s pointless to open an account with an exchange that doesn’t operate in your country, and you don’t want to be caught using an exchange that lacks the necessary licencing or certifications.

KYC and AML

Exchanges must follow different rules depending on where they are located and the services they provide. Many exchanges will have “Know Your Customer” (KYC) or “Anti-Money Laundering” (AML) requirements.

Account holders will be required to verify their identities, which is one of the more visible requirements of these laws. This could include sending a picture of your government ID and providing billing statements to prove your address. 

Many crypto traders find these requirements inconvenient, but they can benefit the consumer. If an exchange follows these rules, it may be a sign that it is trustworthy. Furthermore, these regulations may make it easier for law enforcement to apprehend criminals and recover stolen funds.

Reputation

Regardless of the cryptocurrency you intend to trade, you must exercise caution when selecting an exchange. Fake exchanges and scams are an ongoing issue. Aside from that, there have been reports of exchanges being hacked or users engaging in unethical behaviour. 

Before opening an account with any exchange, search the exchange’s name to see if there are any news stories about previous issues. Check their website to see what they say about themselves, and look into their social media presence to see what others are saying about the exchange. You could also look for user reviews to get a sense of how the site works and how it treats its users. 

You should also try to find out what is going on behind the exchange. Check to see if there is a record of an address. Attempt to learn more about the people who own and run the exchange. If you can’t identify people like the CEO or the COO, you should be concerned. Another cause for concern is if you can find their names but have no reliable information about them.

Fees and prices

For trading activity, most trading platforms charge a fee. Prices for different coins can vary from exchange to exchange, but most fees are calculated as a percentage of each trade. Exchanges are also known to offer lower fees to traders with higher volumes. As a result, investigate the fees of each platform to determine which one provides the best rates. 

Aside from fees, pricing can be an issue because it varies from exchange to exchange. This is referred to as a “price premium.” It is worthwhile to look for the exchange with the best DOGE rates. Prices will differ across exchanges, but they should all be close. Traders should be wary of any exchange that sells coins at a significant discount to market value.

Trading volume

The number of users may differ between exchanges. The activity in various coins may also differ from one exchange to the next. This is significant for a trader because the trading volume has a direct impact on your ability to enter and exit various trades at the appropriate times. High trading volumes can also be used to identify an exchange with a good reputation. 

If you want to trade Dogecoin, the volume and liquidity of the exchange are important factors to consider. Check the figures published by the exchange as well as any third-party sites that track volume data.

Should you store your Dogecoin on an exchange?

Many cryptocurrency exchanges allow users to store their coins in the account they have on the exchange. This is convenient for traders who conduct a large number of transactions, but it is not the most secure way to store your Dogecoin. 

The issue with leaving coins in your account is that the exchange’s security may be compromised, or you may compromise your own account. If this happens, all of your coins may be stolen. It is nearly impossible to recover stolen cryptocurrency once it has left an account. 

As a result, it is recommended that you withdraw the majority of your Dogecoin after making a purchase. Online wallets provide some security, but they can also be abused. However, storing coins in a hardware wallet is the most secure method. However, with the hardware wallet, the owner now has sole custody of the DOGE you purchased, so one would need to do their research to learn how to use such a device, as mistakes could result in a loss of funds.

Should I invest in Dogecoin?

This question does not have a simple yes or no answer. Investing in Dogecoin may be appropriate for some people, but it may not be appropriate for others. There is a risk, as with any form of investing. Cryptocurrency prices can fluctuate dramatically in a matter of seconds. If you’ve been following market news, you’ve probably heard of people who became millionaires in a matter of days and others who lost large sums of money just as quickly. 

Overall, Dogecoin could be considered an investment because it has been around for a while, it has a dedicated community, and its price has risen over time. You must be able to withstand price drops that occur from time to time. If you want to make money investing in Dogecoin, you must be willing to accept risks and watch the price fluctuate in unpredictable ways. 

Finally, conduct your own research to find the best wallet for your needs and compare exchanges to find one that meets your requirements.

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