About crypto exchanges: learn to buy

Updated: Mar 11, 2020

What you need to know to start investing.

A cryptocurrency exchange works like a stock exchange. Although all exchanges offer the most common and popular cryptocurrencies such as Bitcoin, Ethereum and Litecoin, they differ in the number and additional types of cryptocurrencies that are available for trading. Cryptocurrency prices can also differentiate on each exchange, based on the supply and demand of the cryptocurrency.

There are some ways to trade through buy and sell offers called orders in an order book: sellers can create an order by specifying the amount and price they would like to sell their cryptocurrency. Buyers can also create an order, called a purchase order. They set the maximum price they want to buy crypto. The simplest way to trade on a exchange is called a market order: purchase request is executed with the lowest sales order in the order book. A sales request on a market order is executed at the bid price – the highest order to buy in the order book. When a purchase and sales order is compatible, the order is withdrawn from the order book and the trade is executed.

The steps to buy cryptocurrencies are: KYC verification, account financing and withdrawals.

The CoinMarketCap article is part of a guide that brings solid understanding of the fascinating world of cryptocurrencies. The article integrates a series of educational content that we will indicate to encourage you to continue learning and reading about this topic.

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