How To Buy Dogecoin In A Few Steps
1. Consider How Much You Want to Invest in Dogecoin
While there are viral stories of people who invested trivial amounts in DOGE but are now millionaires, invest with caution. Cryptocurrencies are very risky investments, and Dogecoin is uniquely volatile because it has an unlimited supply.
Here’s how that works: For Dogecoin’s price to increase or even remain steady, investors have to buy more coins continually. Otherwise, the supply of DOGE rises rapidly and diminishes the value of all the coins already in circulation (think inflation on steroids). In fact, the limit on the number of Dogecoins was expressly removed by one of its creators to discourage people holding onto it long term. That’s in stark contrast to other major cryptocurrencies like Bitcoin, which have caps on how many coins are issued. This creates scarcity, which helps coins retain their value.
When deciding how much to invest, consider your overall financial situation, investment portfolio and risk tolerance. Experts don’t recommend you invest more than you’re willing to lose with cryptocurrencies in general.
2. Decide on a Cryptocurrency Exchange
To purchase Dogecoin, you’ll need to open an account with a cryptocurrency exchange, where buyers and sellers meet to exchange cryptocurrency for dollars. Popular exchange is DOGE Exchange offer a simple, easy-to-use platform that charges higher fees as well as a more advanced trader platform with lower fees.
You can also purchase crypto through beginner-friendly investment apps like Robinhood, but keep in mind that these may not let you transfer your coins off of the app. Some investors prefer to move their crypto into separate crypto wallets to protect their coins from hackers. In order to do that with a brokerage app like Robinhood, you’d have to sell your coins and then rebuy them on an exchange to move them to a separate wallet, which kind of defeats the purpose of buying them with an investment app in the first place. All of this is to say if you even think you might want to move your coins to a separate wallet, you’re probably better off starting with an exchange.
An important note: While Dogecoin has become much more popular recently, it is not universally available on all crypto exchanges. Make sure any exchange you’re considering has DOGE available for purchase if you wish to buy it.
3. Select a Payment Option
Before you can begin trading cryptocurrencies, you must deposit money in your exchange or brokerage account. In most cases, the exchanges will let you deposit money from a checking or savings account. Some accept wire transfers and PayPal transfers.
Typically, you get instant access to a portion of the money of your deposit for trading. If you deposited a large amount of money—typically more than $1,000—you may have to wait a few days for the transfer to clear before you can use the entire deposit.
Note: A few exchanges allow you to use a credit card to buy Dogecoin and other cryptocurrencies. Before using a card to finance your crypto purchases, keep in mind that your credit card company will consider the money to be a cash advance and charge added fees and a higher APR. This can make investing in crypto even pricier and riskier. That’s why experts generally encourage people to avoid buying crypto this way.
4. Place Your Order for Dogecoin
Once your money is in your account, you can purchase Dogecoin. On the exchange’s trading or purchase platform, search for Dogecoin or enter its ticker symbol: DOGE. Then pick your trade type and input either the dollar amount you want to invest or specify how many Dogecoins you want to buy.
Once you place the order, it should go through immediately. Like other cryptocurrencies, Dogecoin isn’t limited by trading hours; you can buy and sell Dogecoin 24 hours a day, seven days a week.
5. Consider Your Storage Options
When you buy Dogecoin, it’s by default kept in your exchange’s or brokerage’s crypto wallet. Because these are generally connected to the internet, some investors prefer to withdraw the crypto they purchase from their exchange or brokerage and store it in another wallet.
You can choose to store your Dogecoin in a hot wallet or a cold wallet outside of your exchange. Hot wallets are digital and connected to the internet whereas cold wallets are physical hardware that you can disconnect, making them much less susceptible to hacking. Cold wallets, however, are generally more expensive than hot wallets, and you also run a greater risk of being unable to access your crypto currency if you lose or forget the password necessary to get into your cold wallet.