What Is the Difference Between Buying and Trading Dogecoin?
Buying and trading Dogecoin (DOGE) are two completely different concepts although they share many similarities. We have highlighted some of the major differences:
Ownership: When buying Dogecoin, you have ownership of the units bought. With trading, you are simply speculating the prices without assuming ownership by using crypto instruments such as CFDs.
Payment:For every unit of DOGE bought, you pay the full price of the asset. However, with trading, you only have to put a small portion of your total position, which gives you leverage when the price rises. Traders pay deposit and withdrawal fees, unlike investors.
Taxation: Traders do not pay capital gains on profits made from DOGE trading, unlike investors.
Transaction: You can purchase Dogecoin to keep in your digital or offline wallet, while with trading, you are buying and selling on an exchange.
How To Buy Dogecoin (DOGE) in 2021?
Buying DOGE (Dogecoin) is easy if you are familiar with buying other cryptocurrencies like Bitcoin. Although you can find it on the biggest crypto exchanges, it is not always widely available and may require a new wallet or exchange.
The list below shows you how to easily buy DOGE:
Step 1: Find an exchange: After finding a wallet that supports Dogecoin, the next step is to choose an exchange that trades Dogecoin (DOGE). If you are looking to trade, make sure the exchange is legal wherever you reside. Evaluate a number of exchanges by making a list. Check their KYC and AML compliance status, trading fees and their overall reputation.
Step 2: Sign up and fund a purchase: After selecting your preferred exchange, sign up on the platform and fund your purchase. Take note of the trading volume, liquidity and determine your entry and exit points.
Step 3: Make a purchase: Complete your first transaction with DOGE and transfer the coin to your wallet.
How To Trade Dogecoin?
Decide if you would rather trade Dogecoin or buy it as a long-term investment. You can trade cash and other cryptocurrencies for Dogecoin using a crypto exchange. The process is the same for other coins. We have highlighted the various steps to trading Dogecoin:
Find a reliable broker: This is one of the most important steps. Confirm that the broker you are using supports Dogecoin trading. Most times, you will find brokers supporting multiple coins and even other assets. Some of the best Dogecoin brokers are eToro and Plus500.
Make a deposit: After choosing your broker, fund your account using fiat currency such as GBP, EUR, and USD. Remember to look out for the trading fees to make the most profits from your trades.
Determine your trading strategy: How would you like to trade? With online brokers, it is usually through common methods such as spread betting and contracts for difference (CFDs). You would need an in-depth understanding of these methods to know the best approach.
Start trading: After setting up your account, you can start trading. It is advisable to use a demo account first especially if you are new to trading. This will help you avoid mistakes when carrying out a live trade. You can go long or short with DOGEtrades. A long position means you are investing your money with the belief that Dogecoin will rise in value. On the other hand, going short means you believe that the coin will lose its value and fall, so that you can buy at a lower price. Traders can also use leverage. The technique allows for large trades with small amounts. However, it is only best for expert traders who understand the risks involved.
Note that trading in cryptocurrencies is taxable, so be sure to understand the implications.
What Are the Different Ways To Pay for Dogecoin (DOGE)?
If you are looking for how to buy Dogecoin, there are various options available. This section shows you the different ways to deposit money or pay for DOGE. In a nutshell, you can:
Buy Dogecoin using a credit or debit card
Use cash or PayPal to buy Dogecoin
Buy Dogecoin by trading other cryptocurrencies for DOGE
Now let’s take a look at these methods in more detail:
Credit cards: You can buy Dogecoin (DOGE) directly with fiat currencies using your credit card. Binance is one of the best exchange options for credit card payment. It offers security, high liquidity, and low fees. It is quick, easy, and remains a popular option. Remember that using credit cards can be risky as you will be sharing valuable information that can be stolen by an unvetted vendor. Another disadvantage with credit cards is that credit card fees could be added to the normal exchange trading fees.
Debit cards: They work just like credit cards with similar benefits. Transactions are smooth, fast, and easy with debit cards.
ATMs: Crypto ATMs are hard to find and are not a common means of paying for Dogecoin. If you find one, you have to buy Bitcoinfirst before being able to exchange it for DOGE.
Cash: You can pay for Dogecoin with physical cash at places where it is accepted.
PayPal: Fewer crypto exchanges accept PayPal as a means of payment for DOGE because users can claim back their money by reporting the transaction to PayPal. A possible workaround to buy DOGE with PayPal is to use it to buy Bitcoin first. Again, this is not supported by most exchanges except peer-to-peer exchanges like LocalBitcoins and payment fees are also very high.
Digital tokens: These are great for crypto-only platforms where you can buy Dogecoin (DOGE) with other coins.
What To Consider When Buying Dogecoin in 2021?
If you want to buy Dogecoin, there are some considerations to make because the crypto market is driven by an interplay of factors, all of which could affect your trades or investment.
Deposit Fees: These are fees that platforms charge you on deposits. There is usually a minimum and maximum limit which is worth knowing.
Trading Fees: Similar to deposit fees, you must be aware of the commission that brokerages charge you for trading on their platform.
Volatility: This is a double-edged sword and could result in massive capital gains or losses. After learning how to buy Dogecoin (DOGE), you must understand the volatility and the risks involved. Volatility could be affected by market news, rumours, etc.
Regulations: Countries, exchanges, and brokers could place restrictions or certain policies on cryptocurrencies. You should be aware of this possibility when buying DOGE.
Long term holding (HODL): Long-term holding is often seen as an investment. It implies keeping your Dogecoin for over a relatively long period of time in anticipation of a rise in value. In this case, researching the future outlook for the coin will be useful.
Short Term holding: This is similar to trading and it is based on entering the market at different points to maximize profit.
Trading volume: This is the total amount of coins currently being traded. A high trade volume usually indicates a good time to buy Dogecoin (DOGE).
Market emotions: News, rumours, tweets from famous people, holidays, all cause a variety of emotions that affect the market. This is particularly so for Dogecoin. A “bull run” indicates positive emotions and an increase in prices. A “bear market” indicates fear, uncertainty, and doubt with reduced confidence in the market leading to a fall in price. You should be aware of the current market status before buying DOGE.
Is It Safe To Buy Dogecoin (DOGE) Online?
It is safe to buy Dogecoin online as long as you do it the right way. Always ensure you buy dogecoin (DOGE) from Commodities Futures Trade Commission (CFTC) and the National Futures Association (NFA) regulated platforms. Popular examples such platforms include eToro, Coinbase, and Binance.
Always ensure that your crypto wallet has two-factor authentication, along with KYC, and anti-money laundering protocols. Remember to keep your personal and financial data strictly confidential and away from the public.
How To Store Dogecoin (DOGE)?
Storing or “holding” coins is similar to saving. When you store coins, they could increase in value and be used for future transactions.
After purchasing your Dogecoin, it is advisable to store it in a wallet. There are different wallets available for storing your coin:
Hot wallets: Here, users can hold DOGE on the crypto exchange that they purchased it from. This is beneficial to traders looking to make quick and easy transactions. However, this method gives users less control over their funds.
Cold wallets: Dogecoin holders can also store their coins in a self-hosted or personal wallet in what is known as cold storage. This provides more security and responsibility as it is “offline”. Hardware and local wallets are potential options for cold storage. A drawback of this method is that it is not suitable for quick trades as you need to send it from your wallet to an exchange first.
How To Sell Dogecoin in 2021?
After learning how to buy Dogecoin (DOGE), you might also be wondering how to sell Dogecoin. Selling your Dogecoin could be considered a great idea especially when it has increased in value and you are looking to make some profit. The process is the same.
DOGE can be sold through different methods as seen below:
Exchanges: Similar to buying coins, you can sell your Dogecoin (DOGE) for other cryptocurrencies or fiat currency on exchanges such as eToro, and Binance with a few clicks. This is one of the most popular ways to sell your Dogecoin.
ATM: Crypto ATMs are an excellent option. You can use them to withdraw your money’s worth of Dogecoin just like with a commercial bank ATM. Again, crypto ATMs are hard to come by.
Broker: You can also sell your coins to brokers like Coinbase. Remember that brokers set the price and fee that they are willing to buy at.
P2P service: This involves the use of ‘decentralized’ platforms to enable direct transactions between traders without any third-party involvement. Exchanges like Binance also have their p2p systems. This is another relatively safe way to sell your Dogecoin.
Cash: You can transfer your Dogecoin from your wallet to another person or organisation for cash. However, it is important to ensure that there is some form of trust or third-party involvement for more security.
Is It Worth Buying Dogecoin Right Now?
If you’re wondering if it’s worth buying DOGE right now or questioning “Will Dogecoin reach $100?”, unfortunately, there is no straight answer to this question because a lot of factors determine whether Dogecoin (DOGE) is worth buying.
Since the market is extremely volatile and cryptocurrencies generally carry a high risk, buying Dogecoin (DOGE) could be a worthy investment for some and not a good idea for others as dogecoin may swing up and down at any point.
The current token price of Dogecoin is about one-third the price of its all-time high. Buying DOGE might be worthwhile due to its strong community, endorsement by professionals like Elon Musk, and the potential for a sudden increase in price.
You should also be able to withstand any dramatic swings in prices both emotionally and financially. Ultimately, carry out your own research and determine the next best step for you.
Final Thoughts: Should You Buy Dogecoin?
Dogecoin is a good investment if you can withstand high volatility and swings in price. The best way to buy Dogecoin (DOGE) is by using trusted and reputable exchanges like Binance and eToro.
You can pay for DOGE through credit and debit cards, ATMs, p2p, and other payment methods supported by the exchanges.
Can I buy and sell Dogecoin (DOGE)in any country?
Yes, as long as using cryptocurrencies is legal in a country or city, you can buy DOGE without issue.
Is there a limit to how many Dogecoins I can buy and sell?
Dogecoin stands out from other cryptocurrencies as an inflation-based coin with increasing supply. This means that as long as you have the money, there is no limit to how many Dogecoins you can buy.
Can I buy and sell Dogecoin (DOGE) without an ID?
Yes. One of the smartest ways of buying altcoins like Dogecoin without an ID is by using Bitcoin to fund the transaction. You can do this by using a Bitcoin ATM.
Can I buy and sell Dogecoin instantly?
Yes. The easiest and fastest way to buy Dogecoin (DOGE) is by using regulated and trusted crypto exchanges like eToro, Coinbase, and Binance.
What is Dogecoin (DOGE)?
Dogecoin is a cryptocurrency just like Bitcoin, but it started as a dog meme. Software engineers Billy Markus and Jackson Palmer created the coin in 2013. It is known for its low price and large supply.
How does Dogecoin (DOGE) work?
Dogecoin works like other cryptocurrencies using blockchain technology. Miners who find the coin run transactions requiring complicated equations and once solved, record the findings on the Dogecoin blockchain in one-minute blocks. It is open source and makes use of Scrypt algorithm.
Are there other popular cryptocurrencies like Dogecoin?
Yes! In recent months, Shiba Inu has gained a lot of traction along with less popular cryptocurrencies like Floki. If you want to buy some Shiba Inu coins, check out our guide on where to buy Shiba Inu!