How to Buy Tezos in 2021: A Step-by-Step Guide
Keep hearing about Tezos and wondering how you can buy Tezos? Read our beginner's guide on how to buy it today!
Tezos is a decentralized network, like other blockchain platforms. There is heaps of upside potential on this digital currency, with the project currently carrying a market capitalization of just $2 billion.
In contrast to some digital currencies, this one is able to ‘self-amend’. This cuts out the need to fork into two separate blockchains.
As such, this guide on How to Buy Tezos will tell you everything you need to know. We’ll discuss which broker you should consider using to buy Tezos and the steps required to get started with a purchase today.
Keen on educating yourself on how to buy Tezos yourself? Read on.
How to Buy Tezos in 5 Steps
Find a 5 step rundown of how to buy Tezos below:
1. Sign up with an online broker that offers a market on Tezos
2. Deposit a funds into your new account
3. Choose Tezos (XTZ) from the dropdown list of available coins
4. Enter the amount of Tezos you wish to purchase
5. Confirm the information you’ve entered is correct - the Tezos coins will be added to your portfolio.
In this beginner’s guide, we detail the fundamentals of purchasing Tezos from the comfort of your home. This includes the process of how to choose an online crypto broker, and prospective fees and commission to consider.
We also cover popular investment plans and how to place an order to buy Tezos in a risk-averse manner.
Step 1: Choose an Online Tezos Broker or Exchange
As is evident from our 5 step demonstration - it’s advisable to embark on your cryptocurrency adventure via a brokerage site.
By joining a platform such as eToro to buy Tezos you will be able to purchase the digital coins on a direct basis.
Not only that, but you can be sure you are making cryptocurrency investments in a secure environment. This is because eToro is regulated by multiple regulatory bodies.
It’s important to note that whilst you can elect to buy Tezos at a crypto exchange - it’s best avoided, for beginners especially.
Third-party exchanges are more often than not under no regulatory rule. This means there is no authority to keep an eye on how clients are treated.
We mentioned that eToro is regulated by multiple bodies. These include the FCA (UK), CySEC (Cyprus), ASIC (Australia). The broker has also been approved by FINRA, a financial services regulator in the US.
Important Factors to consider before choosing a Bitcoin exchange or a broker:
1. Regulation
There are hundreds of third-party exchanges and brokers where you can buy Tezos. As such, it’s wise to stick to the ones holding a license. The protection and safety regulation offered to traders and investors is priceless.
Regulatory bodies were created to keep online brokers in line, ensuring that crypto platforms conduct their business in a professional way. Not to mention setting universally recognized standards in customer care and transparency.
Unregulated exchanges are prone to being hacked by cybercriminals, sometimes losing millions.
On the other hand, you could buy Tezos from an exchange and store the coins yourself in a private crypto-wallet. But, looking after your own Tezos coins might sound simple enough, however it comes with great responsibility.
If you decide to take care of your own crypto-assets you will have to look after your lengthy private key and backup phrases. Due to widespread crypto-wallet hacks, many people choose to opt for insured wallets. However, not everyone is eligible and coverage is capped.
Over at eToro, you can buy Tezos commission-free - plus, the beginner-friendly broker will store it for you. Best of all - in a safe and regulated space - free of charge.
2. Payment Methods
When you are thinking about how to buy Tezos, you shouldn’t have any issues in terms of payment methods.
Had you taken an interest in cryptocurrencies in the early years, wire transfer was usually the only option available. As you likely know, this option is invariably one of the slowest payment methods for brokers to process.
At eToro, you can buy Tezos with a variety of fast and user-friendly payment methods. This includes debit and credit cards like Maestro, Visa/Visa Electron, and Mastercard.
In terms of e-wallets, the platform accepts Skrill, Klarna, PayPal, Skrill, and Neteller. All of which are safe and speedy.
You can also buy Tezos at eToro using the aforementioned wire transfer, if you don’t mind waiting days to make your purchase.
3. Fees and Commissions
Before you buy Tezos online, it’s recommended to be fully aware of any potential commissions and fees that may be expected of you.
As a broker is a business like any other, the company needs to make money to provide you with access to the digital currency markets. This is usually gained by charging fees, which so long as they aren’t expensive - suits everyone.
After all, you need the broker to access the Tezos market, and the broker needs your business to keep the wheels in motion.
The vast majority of online crypto providers charge clients a percentage of whatever the stake position size is, while some charge a fixed fee.
Let’s offer an example of a variable percentage fee to clear the mist.
Crypto platform Coinbase charges a fee of 1.49% - on entry and exit
As such, if you purchase $500 worth of digital coins you would have to pay $7.45
If your position was $1,000 - the Coinbase fee would be $14.90 - and so forth
To clear the fog, you will see below a simple example of how this very fee could affect your Tezos purchase.
You place a Tezos buy order of $1,000
You must pay Coinbase 1.49%, which equates to $14.90
When it’s time to cash out, your XTS coins are worth $2,000
As such, you must pay another 1.49%, which equates to $29.80
To buy and sell Tezos at Coinbase, you paid $44.70 in commission fees
As is quite apparent from our above example, whilst 1.49% sounds insignificant - fees like this soon nibble away at your profits.
Had you instead signed up at eToro in this scenario, you would have saved $44.70 in fees. The reason being, this popular broker offers a 100% commission-free way to buy Tezos.
Some platforms charge clients a fee for each deposit. For instance, at Coinbase this is 3.99% if funding your account via debit card. In our example above, it would have cost you $39.90 just to enter the market.
Over at eToro, the charge is 0.5% for deposits, which is only chargeable if you are paying in a currency other than US dollars.
4. Other Important Factors
We have walked you through the fundamentals of how to buy Tezos, such as regulation, fees and deposit methods.
Even so, there are some other factors we think are worth your consideration before signing up with a broker.
Let’s take a look at a few other key metrics to think about when contemplating how to buy Tezos online.
User-Friendliness: It should be considered a priority to sign up to an online broker whose website you find easy to navigate. If the platform is novice-friendly you will find the experience of electing to buy Tezos seamless and stress-free. eToro is renowned for being easy to use for inexperienced investors.
Minimum Investment: When thinking about how to buy Tezos, you should think about the minimum investment required by the online broker. For instance, if you are new to the world of volatile cryptocurrencies, a $500 minimum is unlikely to be a realistic option. At eToro, you can buy Tezos from just $25!
Storage: When thinking about how to buy Tezos, it’s crucial you consider storage. As we mentioned, if you happen to be new to the game - unregulated spaces are best given a wide berth. A great safe place for beginners is regulated broker eToro. Here you can both buy and store your coins in a safety-conscious space, under the rule of regulation.
Step 2: Come up With an Investment Plan
The vast majority of investors looking to buy Tezos opt to come up with an investment plan. When you realize how volatile this particular market can be, a plan is a sensible idea.
Whilst an investment plan is a no brainer for beginners, it’s also useful for experienced investors. After all, planning is indispensable.
If you like the sound of creating an investment plan to buy Tezos - take a look below for some insight into commonly adopted strategies.
1. Long-Term or Short-Term
When mulling over how to buy Tezos - do you think you are likely to become a long or short-term investor?
For those unaware, short-term cryptocurrency investors buy Tezos and then sell their coins within minutes, hours, or days. The idea is to take advantage of short-term price fluctuations, cashing out when they spot a money-making opportunity.
This particular market is highly volatile, not to mention speculative. In fact, some digital coins have shifted in value by as much as 5x in a single week.
In a nutshell, short-term investors try to make small but frequent profits from entering and exiting the market at the right time. Thus, if you are able to correctly speculate on the direction of Tezos’s value you could make a tidy profit.
You may, however, also opt for a long-term investment style to buy Tezos. Known as a ‘buy and hold’ strategy - this will see you making your purchase and holding onto the asset.
Long-term investors tend to hold on to their digital currencies for weeks, months, or years. This can be a more comfortable option for beginners, who don’t yet fully understand technical and fundamental analysis.
The reason being is that you no longer have to concern yourself with short-term price spikes when you buy Tezos online.
2. Target Tezos Price
Another strategy to add to your investment plan is a ‘target Tezos price’. If you have never purchased cryptocurrencies before you might not know what this means.
To explain further - Imagine you bought Tezos at $2.50 and wanted to double your investment. In order for this to happen, the coins would have to increase in price to $5.
If on the other hand, if you wanted to quadruple your investment, Tezos would need to rise in value to $10.
Whilst this sounds unlikely to happen, consider that Tezos saw an all-time low of $0.3504 in December 2018. Subsequently, just 2 years later the digital currency experienced an all-time high of $4.44. That’s a price increase of over a thousand percent.
3. Consider Regular Investments
A hugely popular strategy for people of all levels of cryptocurrency experience is regular investments.
As is crystal clear, cryptocurrencies shift in value dramatically, by the second. This is all because of the supply and demand of the market.
When you are learning the ins and outs of how to buy Tezos, adding regular investments to your plan will be helpful in keeping you on track.
This entails making frequent investments. For instance, you might decide to invest every Saturday, or at the end of each month. This enables you to build up your digital currency portfolio slowly, and in a risk-averse manner.
Like the sound of adopting a slow and steady approach to buying Tezos? Then remember, at regulated brokerage eToro you can buy Tezos from $25 upwards!
Such a small minimum investment makes regular investments accomplishable for most budgets.
Would You Consider Investing In Tezos XTZ?
Step 3: Open a Tezos Broker Account
If you happen to have invested in commodities or forex before, then opening an account will be instantly familiar.
For those who haven’t traded a day in their lives - go to the official broker website and elect to sign up.
As eToro is regulated, you will need to enter some basic information about who you are. This is part of the KYC (Know Your Customer) process and helps to fight against financial crime.
You will be asked to enter your full name, address, telephone number, email address, and date of birth. Next, you will be required to upload a clear copy of a government-issued photo ID, like your passport. Again, this is all industry standard in a regulated financial space.
In order to verify your home address, you will need to provide a copy of a recent bank statement or utility bill. The letter/bill must be from an official company and state your name, address and the date the letter was issued.
With an unregulated broker or exchange, you may be able to buy Tezos anonymously. Nevertheless, as we said, this leaves you in a very vulnerable position.
Not only are you in danger of being hacked, but the lack of regulation means that the company has no standards to uphold. The likelihood is that without a license, you wouldn’t know whether a broker was legit - until it was too late.
As we said though, if it’s the safety net of regulation you are looking for - eToro gets an A-star. The platform is regulated in multiple jurisdictions and takes those standards seriously.
Moreover, eToro will have you signed up and able to buy Tezos in less than 10 minutes. This is thanks to the use of the modern automated fintech used to validate your ID information.
Step 4: Deposit Some Funds
Having read this how to buy Tezos beginner’s guide so far - you have no doubt made sure the broker is compatible with your favoured payment type.
You can now go ahead and deposit some funds into your new account to buy Tezos. This process is relatively straight forward.
The quickest method of payment is undoubtedly credit/debit cards and e-wallets like PayPal.
At eToro, you can buy Tezos with a vast amount of payment types, as previously mentioned. When it comes to digital e-wallets, you can choose from Skrill, Rapid Transfer, Neteller, PayPal, Sofort Banking, and more.
You may also buy digital currencies using traditional wire transfer, but bear in mind the processing time is sluggish. As such, you won’t be able to buy Tezos instantly.
Crucially, you need to check what the minimum deposit requirement is at the platform you have chosen. This can range from nothing to hundreds of dollars.
Step 5: Set up a Trading Order
Hopefully, now you have a good grasp of the basics when it comes to how to buy Tezos online. After you have successfully funded your new account, you will need to place an order.
If you are a complete novice, you should know that without placing an order your broker won’t know what your stance is on the crypto-asset.
Therefore educating yourself on creating orders is going to be invaluable when electing to buy Tezos.
Buy Order
First up is the buy order, which tends to be the way in which you enter the market.
In essence, if you believe the price of Tezos is going to rise - create a buy order with the online broker.
You may notice that some crypto providers offer the opportunity to ‘short-sell’. This means that if you think the price of Tezos will fall, you can place a sell order with your broker.
As such, if your speculation is correct, you will make a profit from the decrease in value.
Limit or Market Order
There are other orders to utilize in this volatile environment and they are ‘limit orders’ and ‘market orders’. As we mentioned, short-term investors look to make small regular gains from that very volatility.
The simplest of the two orders is the ‘market order’. This tells the platform that you are willing to accept the current market price on offer.
In other words, this indicates that you want the Tezos order to be executed immediately.
Due to the almost constant price shifts, you will see that the price you get will differ slightly from the price you see on your order form.
For example, you may hit ‘market order’ at $2.45, but get $2.44. As you can see, this is inescapable and usually nothing to worry about.
Next, a ‘limit order’. This order should be chosen if you want to select your own specific price point at which to enter the Tezos market.
You will see below a practical example of how a limit order works when looking to buy Tezos:
Tezos is valued at $2.45, but you want to enter the market at $2.55
With this in mind, you place a $2.55 limit order with your broker
Should Tezos increase in value to $2.55 - your order will be actioned on your behalf
Crucially, this position will remain until you cancel your limit order, or the coins rise to $2.55
As you can see, market orders are instant and simple to create. Limit orders enable you to buy Tezos at a particular price.
Stake
Each and every order you create will need to have a stake specified. In other words, how much Tezos do you want to buy (or sell)?
It’s important to reiterate that the best option for newbies is the ‘little and often’ approach - meaning to make regular investments in Tezos.
With brokers like eToro allowing you to buy Tezos from $25 upwards, you don't need to put yourself in a vulnerable situation by throwing everything you have at one buy order.
Confirm Order
Once you’ve checked through the information you have entered, and are happy with your buy/sell, market/limit, and stake - confirm your order.
If you head over to your account, you will see that your Tezos coins have been added to your eToro portfolio - commission-free!
Step 6: Storing Your Tezos
In stark contrast to fiat currencies like US dollars that are tangible and stored in banks = cryptocurrencies are secured by cryptography and held on decentralized ledgers.
As we mentioned earlier, if you want to buy Tezos via an exchange you can - but do so at your own risk.
Having the responsibility of looking after your own crypto-wallet entails keeping private keys and backup phrases safe from cybercriminals. This isn’t recommended for amateurs as exchange theft is rife.
If you complete the investment process with eToro, you can buy Tezos commission-free and then store the coins on the platform.
This regulation comes from well-respected organizations in the sector, including the FCA, CySEC, and ASIC. The popular broker is also registered with FINRA in the US.
As we said, regulation cuts out the need to worry about sharks in the space!
Step 7: Selling Your Tezos
As you will by now be fully aware - the whole point of buying Tezos is to sell the coins at a later date for more than you originally paid.
Put simply, if you time the market and cash out at the right moment - you stand to make a profit from your investment.
If you opted to buy Tezos via a crypto exchange, you would probably be required to send this to the unregulated wallet at the platform. Next, you would likely need to change your XTZ coins to something like Bitcoin - followed by making a withdrawal request.
Back to eToro, this broker makes the end-to-end experience of buying Tezos a simple and safe process. This is because you simply need to log into your account and hit ‘sell’ next to Tezos (XTZ) in your portfolio.
As per KYC rules, the broker will send the money to your initial payment method - once you request a withdrawal.
Ready To Invest In Tezos XTZ?
Other Ways to Buy Tezos in 2021
That’s nearly all in this how to buy Tezos beginner’s guide. However, there are other ways to buy this speculative asset - which we’ve listed below.
1. Buy Tezos Debit Card
Most of us have used a debit card to pay for things, so it makes sense that you can also buy Tezos in this manner.
eToro accepts debit cards to buy cryptocurrencies and makes the process super easy. Simply enter your card details and how much Tezos you want to purchase - click confirm, and that’s it.
2. Buy Tezos Credit Card
If you would prefer to make your purchase via credit card, this can also be achieved. Simply head over to eToro and fill in your credit card details, with how much Tezos you want to buy.
Be aware that some providers charge what's known as a ‘cash advance fee’ when you use your credit card at a trading site. You might recognize this from credit card ATM withdrawals. Some companies charge as much as 5%.
3. Buy Tezos Paypal
PayPal is a popular and convenient option when looking to buy Tezos. Whilst not all platforms are compatible with this payment method, eToro is. As such, you can buy Tezos with Paypal commission-free!
How to Buy Tezos 2021 - The Verdict
By reading this how to buy Tezos beginner’s guide, you are no doubt feeling confident about entering the market.
That said, we do recommend doing so via a respected and regulated broker. If you are unsure where to turn, eToro serves over 18 million clients, and you can buy Tezos on a 100% commission-free basis.
Furthermore, the crypto provider is heavily regulated by CySEC, the FCA and ASIC, and registered with FINRA.
Signing up takes fewer than 10 minutes and the website is incredibly user-friendly, making it ideal for newbies.