How To Buy Solana - Beginner's Guide
Buying Solana (SOL) : A Step-by-Step Guide
Are you interested in buying Solana, but not too sure where to begin? You’re not alone. The SOL coin is a hugely popular cryptocurrency to buy now.
Solana (SOL) is a relatively new digital asset that was introduced to cryptocurrency exchanges in 2020. It was developed in Switzerland as an open-source project that relies on the blockchain protocol.
The objective of the Solana network is to improve the scalability of the dApp marketplace. In fact, this blockchain can handle up to 65,000 transactions per second, a number exponentially higher than the capacities of Bitcoin or Ethereum.
If you are thinking about adding an up-and-coming cryptocurrency to your portfolio, the SOL coin might be well worth your consideration.
For complete beginners, we have prepared a How to Buy Solana Guide that can walk you through the entire process of purchasing this digital asset in under 10 minutes.
Buy Solana In 5 Simple Steps
If you’re looking to buy Shiba Inu, this quick walkthrough is all you need to complete the process in a seamless manner.
The process of how to buy Solana is as follows:
- Find a regulated crypto brokerage site that allows you to buy Solana.
- Register with your chosen broker.
- Deposit funds into your brokerage account.
- Enter how many Solana tokens you want to buy.
- Confirm your order to complete your purchase of this digital token.
Once you have bought Solana, you can keep your coins on the respective brokerage platform or move them to a private wallet.
But before you start investing in this cryptocurrency, you will want to be clear about your financial goals.
With this in mind, let us explain each of these steps in further detail. We will also give you an account of what your storage options are once you buy Solana.
How To Buy Solana Step 1: Finding An Online Broker or Exchange That Offers Solana
The simplest answer to how to buy Solana will be to find a credible and trustworthy crypto provider that can give you access to this digital token.
However, finding the right platform from the countless options available online can be daunting, especially for a beginner.
So, your first step will be to understand what you need in a crypto provider and research your options.
There are several factors that come into play when making this choice. To begin with, you will need to decide whether you want to buy Solana from a cryptocurrency exchange or a broker.
Let us take a deep dive into the differences between these two choices and what other factors to consider when finding your Solana provider.
There is no doubt that for matters involving investment funds, your chosen platform must be legitimate. When it comes to making an online Solana investment, it starts with the credibility of the platform you choose.
On that front, if there is one aspect that can attest to the legitimacy of a Solana provider, then it is regulation. This means that the platform in question is licensed by a respectable financial authority to ensure safety and security.
Once you start your search for Solana providers, you will notice that it is safer to focus on regulated platforms amidst crypto brokers rather than exchanges. Generally, the latter category continues to be largely unregulated - which means that the site is not governed by any financial body.
This is the main reason why you will be better off buying Solana from a licensed broker - as opposed to an unregulated cryptocurrency exchange.
In order to find out whether a certain crypto broker is regulated, you can look for licenses from respectable authorities such as the FCA, FSA, ASIC, CySEC, or SEC. Bear in mind that the governing body will also differ based on your location and jurisdiction.
It is also common for regulated brokers to be licensed by more than one financial authority - which reflects on their expertise and credibility.
Another thing you want to consider is how you will be able to process payments on your chosen brokerage site.
Today, there are Solana providers that enable you to make deposits and withdrawals via multiple payment methods. For instance, there are platforms that accept bank transfers, credit/debit cards, and e-wallets like Skrill or PayPal. Some Solana brokers even accept mobile options, such as Google or Apple Pay.
That being said, not every broker will accept all these methods. Therefore, before you sign up on a Solana broker’s site, make it a point to check whether the platform supports your preferred payment option.
In addition, you will also want to check whether there are any additional fees involved with different payment methods.
Fees and Commissions
When thinking of how to buy Solana from an online broker, it is imperative for you to be aware of the different fees and charges involved.
Not all brokers will have the same fee structure. Even the slightest change in costs can make the difference in terms of your take-home profit.
The most common fee that Solana brokers charge for facilitating your purchases is the commission. This is not uniform and often differs from one platform to another - depending on the transactions you make.
- One broker might charge you a commission calculated as a percentage. So, if you are buying $1,000 worth of Solana - a fee of 5% will cost you $50.
- Others might have a different fee structure, taking a flat rate no matter how much you invest in Solana.
- At the other end of the scale, you will also find commission-free brokers that will give you the option to purchase Solana without paying this fee at all.
An additional aspect that most beginners fail to understand is that commission is added not only when you purchase Solana but also at the time you cash out. So you will have to account for this fee twice - once when you enter the market and again when you exit it.
Other Important Factors
Although the above-mentioned factors are crucial, there are some other aspects that you do not want to overlook when choosing your Solana broker.
- Minimum Investment - On some brokerage sites, you might be required to buy a certain amount of Solana in order to meet the minimum investment amount. Needless to say, the lower this limit, the better for you as the buyer.
- User-Friendliness - If there is one thing that can make a crypto trader frustrated, it is the lack of user-friendliness. That's why you should consider a platform that adapts to the needs of a beginner. Some platforms allow you to try out their trading site with a demo account, which can give you a better idea of the interface.
- Storage options: As a first-time crypto buyer, knowing where to store your Solana tokens is essential. While you can find a private wallet for this purpose, it is easier if your brokerage site allows you to keep the coins within the platform itself. That is, of course, given that the site is regulated.
It will be helpful to you to follow the above-mentioned factors as a checklist when looking for your Solana broker. Choosing to buy your SOL coins from the right provider can make a substantial impact on how you start your crypto investment journey.
Step 2: Come up With a Solana Investment Plan
Solana, being a cryptocurrency, is a notoriously volatile asset. In other words, the price of this digital asset can change dramatically over the course of a single day.
This is one of the reasons why buying Solana can bring you significant profits. However, this also makes this digital asset a risky investment opportunity.
Consequently, before you risk your hard-earned money into SOL coins, you should have a clear objective and a strategy to follow.
Here are some factors you can consider when setting up your Solana investment plan.
Long-Term or Short-Term
One of the most important things to consider when thinking about buying Solana is how long you intend to hold on to your digital tokens. If you want to keep them for the long term, then it's better for you to own SOL coins.
The duration of such a long-term strategy is debatable. For instance, while some investors choose to hold their SOL tokens for several years, others might cash them out within a few months.
Those who abide by this 'buy and hold’ strategy might see the value of Solana grow over time - to yield them a significant return, provided that the market is in their favour.
If you do not want to risk such prolonged exposure, you can consider trading Solana in the short term. Instead of holding on to your SOL coins for the long-term, you can sell them within a few weeks, days, or even hours.
However, this will require you to speculate on the future value of Solana based on charts, price analysis, and trends. For beginners, this might be a challenge that is too much to undertake.
Whether you choose a long or short-term strategy, it is important to weigh your options and see if they line up within your personal financial goals and appetite for risk.
Target Solana Price
Another strategy is to consider how much profit you want to make from Solana. If you have a goal to attain 50% gains from your investment, then you can store your SOL coins until the value of this digital asset increases by this amount.
This way, you do not have to define your strategy based on the duration. Instead, you will only focus on the market price of Solana.
To make this clearer:
- Let's suppose you bought $100 worth of Solana.
- You want to make a profit of 25% from your investment.
- This means that the value of your investment should rise to $125.
Based on how the Solana market moves, you will be able to realize your profit goals in a matter of years, weeks, or even months. However, you should bear in mind to ignore the price fluctuations that are inherent to cryptocurrencies.
Don't Miss: Solana Price Predictions
Consider Regular Investments
There is another popular investment method known as 'dollar-cost averaging,' which is particularly suited for volatile assets like Solana.
The idea here is that since the value of this digital asset is constantly fluctuating, you can spread your investment amount over regular purchases of Solana.
For example, let's say you have $2,500 in your brokerage account. What you can do is invest this amount overtime in five individual purchases of Solana at $500 per purchase.
It is up to you to decide whether you should buy Solana every other week, or per month. This way, by making systematic investments, you will be able to reduce the average cost of SOL coins over time and consequently, your risk exposure.
Step 3: Opening a Solana Broker Account
After you have chosen a Solana broker, you can get ready to set up your trading account. You can start by signing up on the platform and filling out your information, such as your name, address, and contact details.
Next, you will also need to complete your ID verification. This is a necessary step on all regulated brokers - which adds to the safety of the platform and its users.
To pass this verification, the broker will ask you to provide a couple of personal documents - such as a driver's license or passport. Depending on the platform, you may also need to submit a copy of a recent bank statement or utility bill to prove that your current address.
Step 4: Deposit Funds
Once you have been verified by your chosen Solana broker, you will then be able to deposit funds into the platform.
At this point, you might already have a payment method that you prefer to use. Regardless, bear in mind that digital payment methods such as e-wallets and debit/credit cards are the fastest in terms of deposit times.
If your mode of payment is a bank deposit or wire transfer, the processing time will usually be around two to three business days or longer.
Step 5: Setting Up A Solana Order
Once your brokerage account is funded, you can now make your first purchase of Solana tokens. This involves you placing an order on the trading platform.
There are different types of trading orders that exist. In this section of our How to Buy Solana Guide, we will take a look at the most useful ones to be aware of.
When you are purchasing SOL coins, you will be opening your position with a buy order, expecting that the price of Solana will increase in the future.
When the value of Solana meets your profit target, you can place a sell order to exit your position.
Now, some brokerage platforms also allow you to 'short-sell' Solana - where you can enter the market with a sell order first. When the price decreases, you will then close it by opening a buy order.
Limit or Market Order
A limit or market order are two distinct ways for you to buy Solana. But choosing between the two doesn't have to be difficult - as they widely differ in terms of their nature.
A market order is when you open a position at the price quoted by your broker. The crucial advantage here is that your trade will be filled instantly. However, it might be executed at a slightly different value.
In other words, the price may slightly increase or decrease in the process. For example, if the value of Solana is $100.07 when you place the order, your position might be filled at $100.01.
As prices move fast in the crypto market, such slippage is quite common. But the good news is that it won't affect your intended profitability in the slightest.
Limit orders, on the other hand, will give you a bit more leverage in terms of the entry point. Using this option, you can set the price at which you want to buy Solana.
For instance, if you want to purchase SOL at $99, the order will not be fulfilled until the value of the digital token reaches that price. Or else, it will be considered pending.
However, you will be able to cancel the order manually at any time you choose. Once again, your investment strategy will play a huge role in determining which of these orders is best suited for your Solana purchase.
Aside from indicating to your broker how you want to purchase Solana, you will also have to specify how many SOL coins you want to buy. This can also be mentioned in terms of the amount you wish to invest in this digital token - otherwise known as your 'stake.'
Staking larger sums can get you higher returns from Solana - given that the market moves in your favour. However, if it goes against your prediction, your losses will also be proportional.
Crucially, determining your stake amount cannot and should not be a random decision. You will need to carefully think about how much you can afford to risk on this digital asset.
After you have placed your trading orders and your stake, you should make sure that everything you have entered is correct.
Make no mistake about it; even a slight mistake can cost you large sums when it comes to buying and selling cryptocurrencies.
After you have confirmed, your chosen broker will carry out the purchase of Solana on your behalf. When completed, you will be able to access your SOL coins right away.
Check Out: Could Solana Be a Millionaire Maker Coin?
Step 6: Storing Your Solana
Now that you have purchased Solana tokens, the next step is to think about storing them. You have the option to move your SOL coins to a digital wallet that is not tied to your broker account.
Alternatively, you can also store your SOL coins within your chosen regulated brokerage account that supports a built-in digital wallet. In doing so, you will be able to directly access your Solana tokens while keeping them safe.
Step 7: Selling Your Solana
In all likeliness, the main reason you are buying Solana is to sell it at a profit. As such, you should also be aware of what your options are when it comes to cashing out your investment.
Selling your SOL coins is almost as easy as buying them, especially if you have the tokens stored within your brokerage site. In this case, you will only have to locate Solana in your portfolio on the trading platform and sell them directly.
The proceeds from the sale will be updated to your account, which you can withdraw upon placing a request.
If you have stored Solana in an external digital wallet, you will have to transfer them to your brokerage site before you can sell them.
Other Ways To Buy Solana in 2021
When considering how to buy Solana, you also have the option to make your purchase directly using one of the following methods:
Buy Solana Debit Card
Most brokers will allow you to purchase Solana directly using a valid debit card. After all, the process is incredibly easy and swift. However, depending on your service provider, there may be restrictions in place.
For example, there are a handful of US banks (typically local or regional banks) that will not allow you to purchase Solana from an overseas provider. Alternatively, there might also be limits on payments to online brokers.
Buy Solana Credit Card
Buying Solana using a credit card is also a similar process - wherein you authorize the transaction by entering your details.
However, additional charges may apply depending on your credit card company, as well as your chosen broker.
Buy Solana PayPal
When it comes to e-wallets, PayPal is unquestionably the most popular choice. If your Solana broker accepts this payment method, you will be able to complete your transactions instantaneously and gain access to your SOL coins right away.
It comes as no surprise that crypto ATMs exist. However, Solana is yet to be made available on these machines.
This might be of advantage to you - as the process of buying digital tokens from crypto ATMs can be an arduous process and one that costs you excessively in terms of fees.
How To Buy Solana - The Verdict
Solana is one of the latest additions to the crypto market. For the same reason, it is still too early to predict how this token might move in the future.
Therefore, when thinking of how to buy Solana, we urge that you do your homework, learn about the project, and make an informed decision after considering the risks.
Once you are ready, you can create a trading account with a crypto broker with the right regulatory framework - so that you can access Solana safely and at affordable fees.
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What is Solana?
Solana is a token that was developed in 2017 in Switzerland and launched in 2020. This digital asset was designed to facilitate the development of DApps, with an aim to make the financial space more decentralized.
How to buy Solana in 2022?
The best way to buy Solana is to find an online broker that offers it. Make sure that your chosen platform is regulated and meets your personal requirements before you set up your account to purchase this digital token.
Is Solana worth investing in?
The price of Solana has increased considerably since the beginning of 2021. However, it is best to study the ins and outs of this project in more detail so that you are aware of the risks involved.
How much Solana should I buy?
This will depend on several factors - including your strategy, where you stand financially, and how much risk you are willing to take. It may also be wise to consider buying the minimum investment amount set forth by your chosen broker.
How can I store my Solana?
The best way to store your Solana tokens is in a crypto wallet that is secure. Your broker might also offer built-in storage through your account so you can easily access your SOL coins and sell them directly when the time eventually comes.