How to Buy Dogecoin - Beginner’s Guide
A Beginner’s Guide to Buying Dogecoin
DogeCOIN is now one of the world’s most popular cryptocurrencies.
The year 2021 has been incredibly good for Dogecoin. Born out of a joke in 2013, this virtual currency has taken an unexpected turn for the good - following the popularization by Elon Musk and other famous personalities.
In a matter of a few months, the market cap of Dogecoin has exceeded $35 billion, meaning it is now one of the most popular cryptocurrencies in the space.
If you want to get a piece of the action, you are certainly in the right place.
In our extensive How to Buy Dogecoin Guide, we walk you through the process of getting your hands on this popular digital coin.
Most importantly, we tell you what you need to look for in a Dogecoin broker and how you can start investing in this digital asset right away.
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QUICK GUIDE: HOW TO BUY DOGECOIN
- Choose an exchange to buy Dogecoin.
- Fund your account.
- Buy DOGE.
- Transfer your DOGE into your digital wallet.
How to buy Dogecoin online - A step-by-step guide
Step 1: Choose an online broker or exchange
The most important step while thinking about how to buy Dogecoin is to find a reliable online broker that can guarantee both security and transparency on all your investments.
On third-party crypto platforms, you can purchase Dogecoin in exchange for other digital currencies. However, it is likely that such exchanges do not hold a license from a regulatory body - and as such, this option is best avoided.
On the other hand, if you choose a regulated platform, your interests as an investor will be protected, and your money will be safeguarded.
With that in mind, let us take a look at the different metrics that will help you find a trustworthy cryptocurrency broker in your hunt to buy Dogecoin.
To elaborate on the previous point, it is best that you give priority to the regulation of your broker when deciding how to buy Dogecoin online.
This is primarily because when a broker is unregulated - it means that there is no authoritative body monitoring them.
On the other hand, regulation from serious and well-respected bodies such as the FCA, CySEC, and ASIC will ensure that you are protected against a broker that is willing to exploit unwitting and inexperienced investors.
Besides, unregulated spaces can also be prone to security threats - meaning your trading capital will always be at risk. Even if such exchanges are well-intentioned, in case your money gets into the wrong hands, you will be on your own.
- At the other end of the spectrum - on regulated brokers, the safety of your funds is given the highest priority.
- These platforms must keep client funds at segregated bank accounts, partner with top-tier banks, and implement other security measures.
- Furthermore, some regulated brokers will also have compensation schemes that will provide additional protection to your capital and offer maximum transparency.
Alongside the safety of your trading money, you also have to consider how you are going to store your Dogecoin.
- One way to do this is to choose a regulated broker that also offers crypto-wallet services.
- This way, you can keep your Dogecoin investment at your brokerage platform itself - safeguarding all your trading funds and digital assets under one roof.
The alternative is to withdraw your digital asset from the brokerage account and store it in a third-party crypto-wallet. However, in this case, you will also be responsible for the safekeeping of your private key (your Dogecoin wallet password).
When choosing an online broker, the ease and convenience of purchasing Dogecoin with your preferred payment method is essential.
In the early days of cryptocurrencies, it was a hassle to get your hands on a digital coin. The only payment option available was the protracted method of wire transfer - where you would likely need to wait for days or even weeks for your transaction to be processed.
The best Dogecoin brokers will allow you to deposit and withdraw your funds using a variety of payment methods.
You will have the option to choose between a conventional wire transfer to instant transactions with debit/credit cards. Some crypto brokers - such as eToro, are also compatible with e-wallets like Neteller, PayPal, Skrill, and more.
Fees and Commissions
Before getting on board with a Dogecoin broker, you will want to contemplate what your investment goals are and how much you are willing to pay in trading fees.
Dogecoin brokers make money through trading commissions and fees in return for giving you access to your desired market. This allows them to offer top-notch trading services, as well as give you unhindered access to the cryptocurrency of your choosing.
That said, such trading fees involved can easily add up. For this reason, when you select an online broker to buy Dogecoin, you should make sure that you have checked what fees are involved.
Online crypto brokers differ in terms of the fees involved. Often, it varies based on the size of the investment you make on Dogecoin.
Let us paint you a clearer picture:
- At the cryptocurrency exchange Coinbase, you are liable to pay 1.49% on all trades.
- As such, you pay this when you buy a digital currency, and also when you sell it.
- For instance, if you create a $1,000 buy order - you will end up paying $14.90 (1.49% of $1,000) in commission.
- If you had increased your stake to $5,000, your commission would add up to $74.50
To elaborate further, here is how a practical trade on Dogecoin will work:
- You decide to invest $1,000 on Dogecoin with a buy order.
- If paying a commission of 1.49% - you hand over $14.90 to the broker.
- After a while, your Dogecoin investment is now worth $2,000 - and so you decide to cash out.
- Again - you are liable to pay 1.49% in commission - which is $29.80.
- So in total, your commission on this trade amounted to $44.70
As is obvious from this example, what might strike as a negligible fee can easily add up to a considerable sum - that can eat away your profits.
That is why you need to be completely aware of what you are getting into when deciding on a broker. That said, you can also find online brokers that charge you zero-commissions on cryptocurrency trades - such as eToro.
In addition to trading commissions, you should also be wary of any transaction fees involved while making deposits and withdrawals from your trading account.
Other Important Factors
While regulations and trading fees are at the forefront of our selection criteria, those are not the only factors that determine the efficiency of an online broker.
If you need a seamless user experience, you should also consider the following aspects of the Dogecoin platform:
- User-Friendliness: The user-friendliness of an online broker will determine how easy it is for you to place Dogecoin orders on the platform. Even with dozens of features and numerous resources, if you cannot navigate the website easily - it will only make the process more complicated. An easy-to-use interface will also ensure that the platform appeals to both beginners and seasoned traders alike.
- Minimum Investment: Brokerage platforms also differ in terms of minimum investments. While some brokers allow you to buy Dogecoins with a smaller amount of capital, others might demand a stake in the hundreds of dollars.
- Storage: As we mentioned earlier, you will also have to think about how you are going to store your Dogecoin. Some brokerages come integrated with crypto-wallets that allow you to store your digital currencies at no extra cost. This way, you do not have to worry about finding a provider that offers safe digital wallet services.
Step 2: Come up With a Dogecoin Investment Plan
Every cryptocurrency investor will have a strategy in mind that allows them to make trading decisions based on their goals.
This enables you to leave the emotional factors on the curb, so you can prepare yourself to stay unaffected by short-term market fluctuations of Dogecoin.
In this highly volatile market, timing is everything. Higher risks might lead to significant profits - but, you need to think about your investment objectives.
For those who are complete beginners, here we outline a few popular Dogecoin strategies to consider.
Long-Term or Short-Term
While reviewing how to buy Dogecoin - one of the first things to decide is whether you want to be in the game for the long or short-term.
If a short-term plan is what you have in mind - your aim is to benefit from short-term price movements of the Dogecoin marketplace.
In this case, you will be placing buy orders on Dogecoin with your online broker - and cash out your position within weeks, days, or sometimes even minutes.
As cryptocurrencies enjoy a largely volatile market - you can see significant changes in prices throughout a single trading day. Therefore - if you are able to correctly time your orders, you can make attractive gains via short-term investing.
On the other hand, if you opt for the long-term strategy - you do not have to concern yourself with short-term fluctuations of Dogecoin at all. Instead, you will ‘buy and hold' your Dogecoin for weeks, months or years, until the time feels right for you to cash out and maximize your gains.
Target Dogecoin Price
As we mentioned above, it is best to have a clear objective when you think of how to buy Dogecoin. Many traders set this goal in terms of target prices.
- Say you invest in Dogecoin at an entry price of $0.055.
- Your goal is to double your investment.
- As such - you want the price of Dogecoin to increase to $0.110.
- If your objective is to triple your investment - your target price will be $0.165, and so on.
This might seem a nearly impossible goal to target. But considering the attention that Dogecoin has received in the last couple of months - it might be achievable after all.
To give you an idea - on December 31, 2020, Dogecoin was priced at $0.0046 per coin. Fast forward to two months later - and the price of Dogecoin stood at $0.056.
That is an approximate increase of 1,117% - which makes it seem that exponential profits are indeed possible,
Consider Regular Investments
The concept of investment is often associated with staking large sums on an asset. However, you can also make profits by making smaller but consistent investments.
For instance, you could buy Dogecoin by staking modest amounts on a regular basis instead of risking all your trading capital in one go.
This approach is more slow and steady but allows you to limit your risks to a minimum. Since cryptocurrencies are highly volatile - it is possible that you can make decent returns in the duration of weeks or months.
If choosing this path - you will need to find an online broker that has set its minimum investment amount on the lower end. This will allow you to stake smaller sums on Dogecoin without having to risk large amounts.
Step 3: Open a Dogecoin Broker Account
Since the introduction of online brokers, it has become extremely easy for you to open a trading account to invest in Dogecoin. The process is not so different than setting up a user account on any other financial service.
You simply have to head over to the website of your chosen regulated Dogecoin broker and find the 'Sign up' button.
The next step is to provide personal details, including your name, phone number, email, home address, and date of birth. Regulated brokers will also require a photo-ID, like your passport or national identity card.
For proof of your residential address - you can usually present a utility bill or bank account statement. If you have all the required documents ready - the process can be completed very quickly, and your account will be set up on the brokerage platform.
Step 4: Deposit Some Funds
Once you have opened your account, you will have to add some funds. Choose your preferred payment method from the ones supported by your broker.
The fastest way to add money is to deposit through a credit/debit card or an e-wallet such as PayPal.
You can also opt for a wire transfer - but it could take between one to three business days for the money to appear in your account - sometimes longer.
Step 5: Set up a Dogecoin Order
At this point, you have a trading account and funds ready to start investing. Now, all that is left is to place your first order on Dogecoin.
Trading orders tell your broker how you want to enter the market.
Here we have an overview of the most commonly used trading orders when you buy Dogecoin online.
All Dogecoin investments require you to enter the market using a 'buy' order.
That is - if you assume that the price of Dogecoin will increase - you will place a buy order with your online broker.
When you are ready to cash out, you will place a sell order to lock in your profits.
That said, some cryptocurrency brokers also allow you to 'short-sell' digital assets. Meaning, you will first be placing a sell order on Dogecoin, and when the price drops - you will repurchase them back at a lower price using a buy order.
Limit or Market Order
As you know by now, the price of Dogecoin can fluctuate as each second passes. For this reason - when you see a trading opportunity arise, you need a strategy in place to secure your entry price.
This is where a market order and a limit order come into play.
- A market order will be placed if you want to enter the market immediately.
- Say, for instance, Dogecoin is priced at $0.055, and you want to buy at that price right away.
- Hence, you will place a market order with your broker to buy Dogecoin at this price.
That said, in the highly-fluctuating crypto market, it is possible that the price you agreed on while placing the order and the price you actually get might differ slightly.
For example, you might have placed a market order for Dogecoin at $0.055, and you might get $0.054. It is impossible to avoid such minute variations due to every changing prices.
A limit order gives you the control to buy Dogecoin at a specific price point.
- Let us say Dogecoin is priced at $0.050.
- But, you want to enter the market only when the price hits $0.052.
- Therefore, you create a limit order at $0.052.
- If the price of Dogecoin rises to $0.052 - your broker will execute the order.
- Unless the digital coin rises to your limit order price - the position will remain pending unless you cancel it manually.
Depending on your trading plan, you can choose between a market order to limit order.
Throughout our How to buy Dogecoin Guide, we have emphasized the importance of making trading objectives. One of the crucial aspects of your trading strategy is to know how much you wish to invest in Dogecoin.
Every time you open a position with your online broker - you will be required to specify tour stake. As we mentioned earlier, you can choose to invest smaller stakes to make regular Dogecoin investments or stake a large sum at once.
By now, you know how to open an account with an online broker, how to place an order, and how to choose a stake amount.
When you are confident about these investment choices - you can confirm the order.
This allows your broker to execute your order on your behalf. Soon enough, you will see your newly-bought Dogecoin assets reflected in your investment portfolio.
Step 6: Storing Your Dogecoin
Similar to how we store our fiat currencies in banks, cryptocurrencies are also stored in wallets.
One option to do this is via a third-party exchange. However, these spaces are not regulated - and your assets will be vulnerable to internet security threats.
Alternatively, you can also choose an online broker that offers digital wallet services on its platform. As these are regulated, you can confidently entrust such brokerages with the safety of your Dogecoin.
Step 7: Selling Your Dogecoin
When learning how to Buy Dogecoin, your goal is to invest in the digital asset in order to turn a profit in the future.
Most online brokers allow you to not only buy Dogecoin but also sell it with the same ease and convenience.
This way, you do not even have to move your digital assets to another wallet. You can hold them on the brokerage platform - until you think it is the right time to cash out your Dogecoin and make a profit.
On regulated platforms, you can exchange your Dogecoin for a fiat currency and withdraw the money back to your bank account, debit/credit card, or e-wallet.
Other Ways to Buy Dogecoin in 2022
Investing in Dogecoin is possible through a few other methods as well.
Make a note of these options for your reference:
1. Buy Dogecoin Debit Card
You can directly purchase Dogecoin by using your everyday bank card - including Visa, MasterCard, and more. The process pans out like any other online transaction.
You simply have to specify the amount of Dogecoin you want to buy, and your online broker will execute the purchase for you.
When you are ready to sell your coins, the money will be transferred to the debit card you used to make the purchase.
2. Buy Dogecoin Credit Card
If you do not have sufficient funds on your debit card, you can also opt to make payments via a credit card. However, be sure to verify what the 'cash advance fee' is before you make the purchase.
This is a fee that credit card companies sometimes charge on brokerage-based transactions - and averages about 3%.
3. Buy Dogecoin Paypal
Apart from bank cards, another popular method to fund your Dogecoin purchase is using an e-wallet. Depending on your online broker, you will have multiple choices with this payment option - such as PayPal, Neteller, Skrill, and others.
4. Dogecoin ATM
A cryptocurrency ATM functions similarly to a regular ATM. When you insert physical cash, you will receive cryptocurrencies in return. Only that, these will be added to your digital wallet by scanning a QR Code with your mobile phone.
However, note that not every cryptocurrency ATM will have Dogecoin available to purchase. Moreover, these machines also come with a high processing fee, which can go as high as 10%.
How to Buy Dogecoin 2022 - The Verdict
Our extensive guide on How to Buy Dogecoin has provided you with all the information you need to plan your investment strategy.
To conclude - always make sure that you choose a regulated online broker who holds at least one license from a respected authoritative body. This will ensure that your trading capital and digital assets are protected at all times.
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Virtual currencies are highly volatile. Your capital is at risk.
Is it easy to buy Dogecoin?
Yes, thanks to the internet, it has become easier than ever to buy Dogecoin. You only have to make sure to choose a regulated online broker that can execute your purchase safely.
Which is the safest method to buy Dogecoin?
The most secure way to buy Dogecoin is to buy the coins via a regulated online broker.
Can I invest in Dogecoin for only $100?
Yes, you can. However, it will depend on the minimum investment required by your chosen online broker.
Is it risky to buy Dogecoin?
Much like any other financial asset, buying Dogecoin also involves risks. What you can do is educate yourself so that you can time the market correctly to best mitigate your losses.
What is the highest value that Dogecoin has ever reached?
Dogecoin hit an all-time high on May 2021, when the coin was priced at $0.7376.