How To Buy Compound in The UK
A Beginner’s Guide to Buying Compound Cryptocurrency in the UK
If you’re based in the UK and wish to buy Compound – the process is very easy. All you need to do is find a regulated online exchange, deposit funds into your account and decide how much you wish to buy.
Compound is a protocol that provides peer-to-peer lending solutions using the Ethereum blockchain. It offers this service via decentralized finance applications, bringing both lenders and borrowers together without the need for an intermediary.
It uses the COMP token as a reward for lenders as well as granting early investors early access to governance rights on the network. The COMP token has become increasingly popular within the crypto sphere as it’s now being offered on several cryptocurrency exchanges. If you’re looking to buy the Compound coin in the UK, the guide below will show you how.
What's in this guide?
- QUICK GUIDE: HOW TO BUY COMPOUND IN THE UK
- A step-by-step guide to buying Compound in the UK
- Which wallets can I use to hold Compound
- How to sell Compound
- How Compound works
- Things to consider when buying Compound in the UK
QUICK GUIDE: HOW TO BUY COMPOUND IN THE UK
- Open an account with an exchange
- Verify your account
- Go to the deposit section
- Go to the platform and select Compound
- Enter how many Compound tokens you want to buy
- Confirm your purchase
A step-by-step guide to buying Compound in the UK
Step 1: Open an Online Account
Obviously, the first thing you have to do is to open an account with a cryptocurrency exchange that accepts COMP for trading. Here, you need to choose an exchange that will allow you to fund your account using fiat currency if you don’t have another cryptocurrency in a wallet. The right cryptocurrency broker will provide the platform to enable you successfully purchase Compound coin.
During registration, you may be asked to provide certain details such as your email address, proof of ID, and employment details. However, this depends on the exchange. Some may only require your email address and for you to create a password for your account.
Remember to enable two-factor authentication to increase the security of your account. Once your account is created, an email notification will be sent to you.
Step 2: Fund your account
The next step after registering with an exchange is to deposit funds into your account. Since you’re selected a broker that allows you to fund your account using fiat currency, you should have a lot of deposit options, including PayPal, credit card, or debit card. Alternatively, you can deposit directly through a direct bank transfer.
On the account section of the exchange, enter the amount of GBP you wish to deposit and fill in the remaining details. Once the deposit is approved and the transaction is executed, the fiat amount will be credited to your exchange account.
Step 3: Buy Compound
After depositing funds into the account, it is time to place your order on the brokerage account. Go to the order page of the brokerage platform where you will see different types of orders. The most common is the market order and the limit order.
The market order offers the purchase of COMP at the current market price. On the other hand, the limit order enables the user to buy Compound tokens when the price falls to a predetermined amount. Here, you can select your buy limit and the order will only be filled when the price of Compound coin falls to the price you select.
On the order page, you will see different trading pairs. Select the COMP/GBP pair if it’s available on the portal. Otherwise, choose the BTC/GBP pair. After the transaction is complete, you can use the Bitcoin to buy COMP.
Which wallets can I use to hold Compound?
Now that you have the Compound token in your exchange account, you may be thinking about how to store it properly. While crypto exchanges provide custody options for users, it’s safer to store your cryptocurrency in a crypto wallet. You can store COMP either in an offline wallet or an online wallet.
The former is a hardware wallet that keeps your cryptocurrency safe from any online access. The latter is ideal if you intend to access your cryptocurrency regularly. So, when it comes to safety, the offline wallet is the best to store your Compound token.
How to sell Compound
If you’re looking to sell your Compound coin, it’s easy to do that on the crypto exchange. As you have done in step 3 when buying Compound, go to the exchange portal and select the right crypto pairing option you are exchanging COMP with. Enter the amount of Compound you are selling and review your order.
Once the transaction is approved, a confirmation notification will be sent to your email and the currency deposited to your exchange account. You can choose to withdraw the funds to the fiat currency account used in depositing the funds.
Alternatively, you can buy another cryptocurrency using the funds.
How Compound works
As stated earlier, the Compound protocol is a decentralized finance (DeFi) lending platform. The uses the cTokens for transactions, as users can easily deposit ERC tokens, allowing them to earn interest. They can also use the funds in other applications.
The holders of the token can also vote on certain decision-making processes within the network. The Compound protocol is based on the Ethereum blockchain and beings both lenders and borrowers together without the interference of traditional intermediaries. This makes it a unique approach to making funds available to users while maintaining a low interest on the funds.
Things to consider when buying Compound in the UK
The following are the key things you should consider before buying the Compound token in the UK.
Like other cryptocurrencies, the Compound token is highly volatile and unpredictable. The market is speculative and prices can be influenced easily. As a result, it’s important to have this in mind when buying or investing in cryptocurrency.
The level of competition in the market for a project can affect its overall growth and adoption. Compound is not isolated in the market, as it has several competitors offering similar features. Projects like UniSwap, Aave, and Yearn.Finance are vying for dominance within the same space. That means, the projects are sharing a single market, which makes it not very easy for rapid expansion and adoption.
While Compound has a lot of competition, one of the things standing in its favor is the strong community support it receives. The protocol and token’s users and its team are more proactive in their effort to make the protocol grow. As a result, the level of adoption has increased in recent times. This speaks well for the strength of the Compound token.
The Compound token is increasingly being traded on exchanges across the UK. Many investors feel this is the right time to enter the market as the DeFi sector is currently witnessing a revolution. If you’re looking to invest in the token, you need to select the right exchange, deposit funds, and buy the amount of COMP you need. The guide above provides step-by-step processing to investing in the Compound token in the UK.
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