Crypto industry is evolving and evolving fast. The crypto market reached a whopping $3 trillion worth industry in 2021 with most of the legacy cryptos touching their ATH the same year. However, the May 2022 crash was a catastrophic disaster for the crypto world, pushing down the crypto market below $1 trillion. As of November 2022, most of the cryptos are reeling from the crash and their prices are still low. You can say crypto trading has reached a new low with the recent crash. The only good thing about the entire thing is that you can now buy crypto assets at a low price. You might opt for fiat trading for buying cryptos when these are passing through low multiple.
Why to and how to opt for fiat trading for purchasing cryptos
Why to use fiat trading for crypto purchase?
Fiat trading in the crypto world implies a process where you purchase cryptocurrency with fiat currency. USD is the most popular fiat currency when you are looking to purchase crypto. The other most used fiat currencies in the crypto space are EUR, JPY, KRW, and so on.
There are a multitude of reasons to use fiat money for crypto purchase.
Familiarity
Fiat money is always a familiar payment mode even for crypto users. Crypto is a newbie in the fiscal market and does not offer the same familiarity that people experience with the age-old fiat. As a result, investors, especially the new ones, usually prefer to buy crypto with fiat payment.
Easy accessibility
When it comes to fiat money, capital is easily available. Fiat money is a regular part of your daily life and you don’t have to go through elaborate procedures to access the money.
It’s not always the case with crypto. For crypto, you will have to sign up with a crypto exchange and store holdings in a wallet. And, that’s quite an elaborate process in comparison to just linking your card or bank account with an exchange. Bottom line is, usage of fiat money for crypto purchase makes things more convenient for crypto users. As a result, crypto experts usually advise new crypto investors to opt for fiat money initially. It helps to create a sense of ease and convenience in a comparatively alien territory.
More stable value
Another advantage of opting for fiat trading for crypto purchase is that fiat assures a more stable value in comparison to cryptocurrency. If you are acquainted with the characteristics of the crypto market, you know well by now that the crypto industry is extremely volatile. Driven by wild volatility, the cryptos can swing from high to low and vice versa any moment. What if the cryptos you have saved for buying other cryptos take a dip? You would be left with almost nothing of value to make the purchase. In that case, you would only have to wait till the cryptos rise in value- unfortunately, that can take any time from 2 months to 9 months.
You don’t have to encounter these problems with fiat trading for crypto purchase. Fiat money is always more stable in comparison to cryptos as these are backed by national governments. Thus, fiat money won’t lose out on a significant part of its value as frequently as cryptocurrencies,
Using fiat for purchasing crypto
It’s to note here that fiat currency for crypto purchase is not allowed in every kind of crypto exchanges out there. For example, the DEX or Decentralized Exchanges don’t allow crypto purchases with fiat. It’s only the CEXs or Centralized Exchanges that allow crypto purchase with fiat money.
Choose the right exchange
Your first step here starts with finding the right centralized crypto exchange.
Remember one thing- the CEXs are highly prone to hacking attacks given their centralized administration. Thus, you need to be more cautious about the security aspect of the centralized exchange while choosing a crypto exchange. Make sure that your chosen CEX is extremely particular about storing funds in cold wallets. The platform must also follow 2 FA authentication procedures.
Another point to check here is whether or not the crypto exchange accepts traders and investors from your country. You must also make sure that the exchange is user-friendly, charges low trading fees, and offers 24/7 live customer support.
Decide payment method
You have different payment options to choose from when you are opting for fiat trading for crypto purchase.
The most common one is card transfer. Crypto exchange platforms accept both credit and debit cards. The best part about card transfer for payment is almost instant processing of payment and receipt of crypto in your wallet. If you are aspiring to make a quick purchase for a quick trade, then, you can opt for card payment on the crypto exchange.
But, if you can afford to wait for a few days to receive the crypto, then you can opt for bank/wire transfer. It’s because card transfers charge higher fees than other payment methods. There are certain fees that you would have to pay only with card payments. On the other hand, wire/bank transfers charge much less fees. The only con about this payment system is that it follows a delayed approach and it takes something around a week for the crypto to reach your wallet.
Read more: buy bitcoin with a debit card
Buying with fiat
There are just 4-5 simple steps to follow when you are opting for fiat trading for crypto purchase.
Let’s assume that you have already created your account with a reliable crypto exchange. The process will involve KYC verification- so you must plan in advance. After registration, simply, sign in to your account. You will go to payment mode and choose fiat. Then, you will enter your payment details. After that just enter the amount you will want to spend to buy crypto and the platform will immediately show how much crypto you will receive with the amount. Now, all you would need to do is to check and confirm your crypto order and wait for the coin in your wallet.
