I see several questions on this subreddit with regards to Cryptocurrency being asked at least once every day. These questions pertain to the topics of:
- Where and how to buy Crypto?
- Which platforms to use?
- Why some platforms have only so few coins? How like that?!
- How to transfer Crypto?
- Why are transaction fees for BTC/ETH so high, how do I avoid it?
- What are some investing strategies?
- Got risk a not? Are my funds safe?
- How to detect and sniff out scams and also secure your crypto? - impersonation, phishing, 'giveaways'
- How to earn more from my crypto?
Questions are not ranked according to the order of importance nor are they ranked to which is asked the most. It is just from observations and my experience answering questions this past month. I hope to provide an ELI5 guide to help beginners who are coming into this new world of Cryptocurrency and to hopefully make it a less painful experience for you.
1. Where and how to buy Crypto?
Firstly, before we get into knowing 'Where and how to buy Crypto', you need to understand that Cryptocurrency comes in many different tokens, just like fiat comes in USD, SGD, MYR, GBP, etc. Bitcoin is used loosely to describe Cryptocurrency because it was the first digital currency to come into existence. There are several other currencies like Ethereum, Cardano, Litecoin, Bitcoin Cash... But I will not go into details.
So, where and how do you buy Crypto?
For beginner's sake, I will be focusing mainly on platforms readily available here because that is the easiest way to obtain Cryptocurrency. Below are some of the exchanges/platforms that are widely used in Singapore and are very beginner-friendly (with guides, FAQs and the like). Note that you need to pass KYC for a majority of these exchanges before you are allowed to purchase due to compliance and regulatory laws - sometimes not of Singapore's nature. This is the where:
- Binance Singapore
- Coinhako
- Crypto.com
- Gemini
- Binance (Worldwide)
- Kucoin
- Coinbase
- Kraken exchange
Now, you noticed that there are 2 Binance listed on top, I will go into further detail later.
The how is below (methods are pretty much the same across all platforms, please correct if I am wrong and I am happy to make edits)
- Bank direct deposit/transfer
- SWIFT Remit
- Credit/debit card
- Using crypto to buy crypto
- P2P (won't be covered here)
2. Which platform to use for us Singaporeans, and how to deposit + fees involved? (not inclusive of debit/credit card cause high fees)
From my personal experiences, these are the platforms below that support direct bank deposit with SGD and/or Xfers:
- Binance Singapore (Xfers with bank deposit)
Advantages: Temasek got invest lor, so can trust our gahmen's foresight. Lower fees than Coinhako. Simple UI/UX. 0.6% buying/selling fee considered one of the lowest. Established company.
Disadvantages: Very few coin offerings. No app. KYC is very troublesome. Only buying and selling, no integration with main Binance
- Coinhako (Xfers and bank deposit)
Advantages: 1% buying/selling fee, can be reduced with reward points to 0.75-0.8%. Does their best to bring new coin offerings every now and then. Can use reward points to redeem free crypto (but you need to make a trade during the last 30 days to do so)
Disadvantages: deposit with Xfers, 0.55% fee charged on deposit, use bank deposit free, but only processed at 10 AM and 4 PM on business days. Almost non-existent customer service team. Tends to crash during major news events.
- Crypto.com (Xfers direct deposit)
Advantages: More than 100+ coins that you trade. Have a crypto cashback card. Have a DeFi wallet (what is this?). Launched mainnet 2 months ago. (what is this?). Have an exchange to do trading. Have staking options to earn interest on your crypto. Solid app interface.
Disadvantages: SG onboarding is stopped at the moment. Many have experienced high spread here. Customer service is very slow, but they do their best to reply - so can be an advantage? Tends to crash during major news.
- Gemini (Xfers direct deposit)
Advantages: Gemini now has sgd eth / BTC pairing and with 10 free withdrawals. Also, all I know is that KYC was a breeze because it is integrated with SingPass, and they have passed a majority of MAS's digital payment services license even though they are in Singapore shorter than Coinhako is. Solid and simple app interface as well. Other Redditors, feel free to contribute!
Disadvantages: None that I know of so far.
Then, this begs the question: But I want to trade meme coins like SHIBA! I want to do mining! I want to be able to do much more! How like that?! What other platforms?
- Binance (Worldwide), the biggest exchange/trading platform in the world that offers a multitude of services you can utilize, with close to 1000 coin pairs offered.
- There are many other exchanges/platforms out there like Binance, but I will just focus on Binance for newbies today.
This brings us to the next question...
3. How to transfer Crypto to exchanges like Binance?
My favourite, low-fee but a little bit arduous method that I always preach and that be done within one hour:
- Depositing:
- Deposit through Binance.sg/Coinhako/Gemini/Crypto.com through bank/xfers
- Buy XRP/XLM/TRON/LTC/BCH and send it over to Binance.com. The coins listed have transaction fees lower than $5 and are almost instantaneous.
- Sell XRP for USDT and then buy whatever coins I want. Why? If you are not looking to trade immediately, USDT is a stablecoin (what is this?) that offers stability in the volatility of the crypto market.
- Withdrawing:
Reverse engineer the method above.
You will be questioning then: "Why must do this? SOOOOO TROUBLESOME! Why can't I send BTC/ETH straight away?!" or "Just buy using card la! Or use SWIFT REMIT!". Bringing us to the next question.
4. Why are transaction fees for BTC/ETH so high, how do I avoid it?
You can, no problem. But remember that this is a guide for newbies and we are making it a less painful experience for you.
BTC/ETH are subject to high miners' fees at the moment. Sending $10 worth of BTC over, you would need to pay close to $50 in miners' fees. Same fees for larger transactions. For ETH, you need to pay $20-25 per txn depending on the time of day. Paying $20 to send $20 is ridiculous don't you think?
Also, SWIFT REMIT and purchases through card are subject to foreign exchange fees, remit fees and even card fees which would bring an initial $1000 deposit down to $950, do you want that?
5. What are some investing strategies in Crypto for beginners?
For beginners, I always like to use the DCA method. You can always reference a guide to investing as well - don't have to be solely focused on Crypto. I have a handy guide here which I posted on r/CryptoCurrency which you can refer to.
6. Got risk a not? Are my funds safe?
As with all others, there is always a risk to investing. Low risk is also risk. You have to determine your risk profile to understand how ready you are to invest in crypto.
As always quoted in the crypto community: "Not your keys, not your crypto!".
To mitigate risk, remember to diversify your funds and not keep everything in one place. I can't guarantee a platform is 100% safe because even the government is subject to data breaches. You can keep yourself safe by staying knowledgeable and understanding the industry through DYOR, DYOR, DYOR!
7. How to detect and sniff out scams and also secure your crypto?
FIRST RULE OF THUMB - DO NOT RECEIVE OR RESPOND TO ANY DMs FROM STRANGERS!
Keep your wallet/seed phrase only to yourself, and keep checking and validating that a site is legit before connecting any wallets to the site, like Metamask! There are a lot of scams promoting 'giveaways'. If it is too good to be true, it usually is.
Remember! 2FA is extremely important to secure your accounts! Google Authenticator, Authy and/or a hardware security key are important to secure your crypto assets.
8. How to earn more from my crypto?
Now comes the juicy part. Besides buying and selling crypto, there are a variety of options where you can increase your crypto stack and even earn a 'passive income' from. These options are:
- Interest earning platforms like Gemini, Blockfi, Nexo and Hodlnaut (yes us!) where you deposit your crypto with these platforms, they lend out/invest these assets like a bank, and give you a favourable interest rate after taking profits
- Staking to validate transactions. Coins like ETH require you to stake your assets to validate transactions on the network, and you get paid a percentage of the fees to do so. There is the main ETH network where if you have 32 ETH and above, you can contribute to a node.
- DeFi Protocols. These are crazy mechanisms that can see you hitting more than 100-200% APY on your funds invested. However, they are extremely subjective to this term called 'Impermanent loss' and also always under the scrutiny of hackers.
- There are many other ways that you can earn from, but these are some of the most widely known methods currently
To conclude, I hope that this nifty guide goes a long way to helping people new to crypto understand questions that are asked again and again in this subreddit. I am open to making any edits if I have made any mistakes in my post above, so do leave a comment below if you spot it.
Additionally, if you have additional information you would like to contribute, let me know too!
EDIT: Added into Gemini's advantages thanks to u/shawnthefarmer
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