Polkadot (DOT) is an open-source sharding multichain that operates on the Ethereum network. Polkadot uses Oracle technology to connect blockchains so that information can be shared between multiple projects and networks. The goal of the Polkadot network is to create a truly decentralized web by allowing blockchains to "communicate" with each other. Polkadot is currently the 9th largest cryptocurrency in the world by market capitalization.
Want to learn more about investing in Polkadot? Our guide will help you get started.
Step 1: Open An Online Account.
The easiest way to buy and sell cryptocurrency is through a crypto broker. Your broker will allow you to convert fiat currency or other cryptocurrencies into Polkadot online with just a few clicks.
If you're not sure where to buy Polkadot, consider our favorite exchange that carries the token below.
Coinbase makes it exceptionally easy to buy and sell major cryptocurrency pairs. You can even earn cryptocurrency rewards through Coinbase's unique Coinbase Earn feature. Advanced traders will love the Coinbase Pro platform, which offers more order types and advanced features.
Although Coinbase doesn't offer the cheapest prices or the lowest fees, its simple platform is easy enough for beginners to get by in just one trade.
Some of the features we love about Coinbase are:
- User-friendly. Coinbase has an intuitive layout. Quickly find balances, compare prices, and place buy and sell orders with just a few clicks.
- Intuitive mobile app. Coinbase's easy-to-navigate design extends to its mobile app. If you're new to crypto trading and prefer to use a mobile app, Coinbase's mobile app gives you an easy way to enter the market.
- Better Prices with Coinbase Pro. Although Coinbase's fees are above average, Coinbase Pro offers more competitive pricing as well as improved tools and ordering options.
Understanding the cryptocurrency market can be difficult, especially for new investors. Coinbase's simple and intuitive platform offerings can be a welcome change for those who are getting into crypto for the first time.
Step 2: Buy a wallet
A cryptocurrency wallet is a mobile or desktop app that allows you to store your cryptocurrency securely with a private set of keys. For the highest possible level of security, we recommend investing in a cold wallet. Cold wallets are devices that you can buy from websites like Amazon. Most models function like a flash drive, allowing you to connect to your computer or mobile device via Bluetooth to transfer your coins to a more secure wallet. Your cold wallet stores your coins offline, ensuring that only you have access to your coins.
We Recommend: Ledger - Hardware Wallet
Consider some of our favorite cold storage solutions below.
Most affordable: KeyKeep
Some cold wallet models can cost more than $100. If you only need to store a little crypto, consider the secure and affordable KeyKeep model.
KeyKeep is a simple, straightforward cryptocurrency wallet that connects to your computer via USB. KeyKeep supports ERC-20 tokens like Polkadot in addition to other major cryptocurrencies like Bitcoin, Ethereum, Litecoin, and more.
Best of all, KeepKey offers all this protection for less than $30.
One of the most popular cold storage solutions available, Trezor Model T combines top-notch security with a simple setup process that even beginners will understand. To get started, simply connect to your computer or mobile device via Bluetooth or USB, visit trezor.io/start and follow the instructions. Your device will be up and running in just a few minutes, so you can quickly transfer your investments to your wallet.
The Trezor Model T also features a full-color LCD touchscreen that lets you manage your coins more effectively when you're away from home or on a public Wi-Fi connection. With a simple setup process, large storage sizes, and many compatible coins and tokens, the Trezor Model T is a great choice for new investors and seasoned pros alike.
Step 3: Make your purchase
The final step to investing in cryptocurrency is to make a buy order through your broker's trading platform. There are a few different types of buy orders, and each buy order gives your broker a specific set of instructions to follow when they execute your trade. Some of the most common types of buy orders you will see may include the following:
* Market orders. Market orders are executed as quickly as possible. They give you less control over the price paid for each asset, but they can be useful for those who need a quick buy.
- Limit orders. Limit orders are executed as quickly as possible at a specific price. For example, you can set a limit order with a price limit of $5 per token. If the price of the token you invest in drops to $5 or less, your broker fills the order. If the price does not fall to $5, your broker will not fill the order.
- Recurring Order. Some brokers offer recurring orders that allow you to invest on a set schedule. For example, you can set an order to buy $500 worth of polkadot on the first day of each month. Depending on the broker you buy through, you may be able to set recurring orders on an annual, monthly, weekly, or even daily basis.
- Stop-limit order. A stop-limit order is a conditional order that will only be executed under a certain price screen. For example, you can set a stop-limit order for Polkadot with a stop price of $5 and a limit price of $5.25. Under these circumstances, your broker would start filling your order as soon as the price of each token reaches $5. As long as the broker can fill the order below $5.25 USD per token, your order will continue to fill until completion. If the price of Polkadot rises above $5.25 USD, your broker will stop filling the order.
Depending on your broker, you may have access to additional order types.
After your broker fills your order, you can transfer your coins to a wallet if you plan to become a long-term investor. You may want to transfer a small amount of money first before sending your entire purchase to be 100% sure that your wallet address is correct. If you send your cryptocurrency to an incorrect wallet address, it will be very difficult to get your tokens back.
Trade or sell your cryptocurrency
If your broker can fill your order, you will see it in your brokerage account. From here, you will need to decide if you want to hold your tokens for a long period of time or trade during the week or day to take advantage of short-term price movements.
If you decide to sell on an ongoing, short-term basis, you will need to open an account with a broker that places a high emphasis on platform speed and security.