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How to Buy Algorand - Where to Purchase ALGO?

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Created by an established academic and launched in 2019, the Algorand ecosystem is a booming, diverse, and futuristic project that uses a modified Proof of Stake consensus mechanism to verify transactions on its blockchain.

Algorand focuses on empowering its users by giving them complete access to decentralised financial services. Powered by the native ALGO coin, Algorand is growing into a trustable protocol for many. People all over the world are using the Algorand blockchain system daily.

Are you interested in Algorand? If yes, read on as this article will provide a complete explanation and guideline on how to purchase Algorand. 

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Why Trade rather than Buy Algorand for Cheap and Fast Returns?

1

You Don’t Need a Wallet:

You trade on the price movement of the coin without having to buy and store it.

2

You Can Use Standard Payment Methods:

All regulated brokers accept popular methods of payment such as credit/debit cards and bank transfers.

3

Trades Are Fast and Withdrawals Are Easy:

Trades are executed within seconds and withdrawals will reflect instantly in your account.

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5 Things to Consider if you Want to Buy Algorand

Buying cryptocurrencies can be a bit tricky, especially if one is new to crypto. However, some important things are to be kept in consideration while buying ALGO. The following are a few aspects you should keep in mind. By following these, you will be able to make a sound investment in Algorand. 

Carefully choose your preferred secure payment method

Although your preferred platform may offer different options to fund your trading account, these can be limited due to your location. Of the ones available, you will need to review different aspects such as cost of the transfer, speed and ease of use. A cheaper one, for example, may not be for you if the time taken for the transfer is too much.

Will you need to set up your own wallet?

While Algorand trading platforms will offer an inbuilt wallet for you, it is advisable to have an independent and separate one. This allows you to move your Algorand tokens away from the platform and protect them in case the platform’s security is compromised. 

If you are using a derivative instrument such as CFDs, you will not need a wallet at all since you will be trading the price of Algorand and you don’t need to buy actual tokens. 

Comparing costs

Do remember that there will be costs associated with moving the ALGO tokens from one wallet to another. Algorand is famous for its near negligible fee which will remain the same, no matter where you send ALGO tokens to. This means Algorand is an excellent means of payment and transfer as it is much more affordable than traditional alternatives. 

Safety and security

Considering safety and security measures is an essential element of different cryptocurrencies and for such purposes, all of the decentralised currencies use different protocols and methods to assure the safety of held tokens. 

When it comes to Algorand blockchain, it uses a decentralised Byzantine Fault Tolerance protocol which allows the network to continue working securely even if a significant number of validators defect. All of this is built on top of its modified consensus called Pure Proof of Stake (PPoS), which allows anyone with even 1 ALGO to become a relay node. Participation nodes, which produce the blocks, are selected at random, thus ensuring that no single party can take over the network. 

While Algorand has taken sufficient steps to make its network secure, you must not forget the security of the platform you will be using to buy ALGO tokens. Secure passwords and username are standard, but you will need to look at other advanced options being offered, such as 2FA (two different inputs or passwords are needed to access functions), MT4 (used primarily for ForEx trading security and functions) and MT5 (an advanced version of MT4 that offers enhanced security and derivative trading options).

Can you understand and navigate the platform?

While the basics of all buying and trading platforms remain the same, there are aesthetic and functional differences. For a person who is not familiar with these, the graphs and different data displays can be overwhelming.

It would be prudent to check out each section and option individually, noting down what these show you and how you can use the data from each and coordinate to build your purchase decision. Don’t rush, it’s best to allocate proper time in exploring the platform before putting any of your investments to ensure a complete understanding of all the rules, regulations and mechanisms involved.

Ultimate Beginner’s Guide to Trading Algorand

What is an Algorand Broker?

Brokers act as an intermediary between cryptocurrency markets to facilitate trading activity for their clients. With cryptocurrencies gaining momentum in the last few years, online trading has become a phenomenon and brokers have become far more common for people to access Algorand.  

ALGO is a popular cryptocurrency on the market and today several brokers are available that allow people to trade the coin easily.

What is an Algorand CFD?

A contract for difference (CFD) is a derivative and (as the name implies) an agreement that will pay out on the differences of ALGO price (when the CFD is opened and when closed). The name derivative implies that the investment instrument (in this case, a CFD) derives its price from an underlying commodity, in this case, from Algorand.

Another advantage of CFDs is that as a trader, you can use several options to multiply your profits. Using leverage on your position can multiply your profit ratios without investing the complete required amount while using a short position can also allow you to make money even if the market is bearish.

What is the Benefit of Algorand Regulation?

Since cryptocurrencies became popular and more and more people started to invest in them, financial regulators worldwide are moving to legislate and better regulate these investment instruments. In some jurisdictions, special laws have been introduced or platforms are obliged to follow existing customer and investor rights.

Brokers that comply with regulations, offer a higher level of security, both technical and financial, to their clients and this creates a much better and secure option for the traders.

What is the Best Payment Method for Buying Algorand?

With clients not limited to one jurisdiction or country, platforms are keen to support different payment methods so that their users can buy ALGO easily. Each funding method has its advantages and disadvantages. You should have a fair idea of what these options offer and if there are any limitations due to your location.

Buying Algorand with Bank Transfer

Bank transfers are one of the most preferred methods due to their common availability. Depending on where you and the broker platform are located, this can be (or not) a cheap option. While more secure, it does have a drawback of time. A bank transfer can sometimes take days if the payment is across different jurisdictions.

Buying Algorand with Credit Cards or Debit Cards

The most convenient and fastest way of purchasing ALGO tokens. Debit and credit cards payment methods are almost universally accepted. Easy and convenient, the use of cards can carry an extra fee compared to bank transfers.

Buying Algorand with PayPal

PayPal today is a credible platform for digital payments and a popular alternative payment method. At times cheaper than using cards or bank transfers, this funding option may not be for you if you reside in a country where the service is not supported. 

On the other hand, even if you do have PayPal, it might not be offered by the broker as a payment option in the first place.

Buying Algorand with Cash

Buying crypto with cash is certainly attractive as there are no fees involved. However, this is by far the most unsafe method. First of all, you will need to search for someone willing to sell you Algorand for cash. Even if you do find such a person, you cannot be sure of the integrity of ALGO sellers. A private agreement has no financial safety or protection and if you do want to take this road, it will be a risky approach. It is always better to deal with regulated platforms. 

The Verification Process for Trading Algorand

Reputable and regulated brokers will always go through a user verification system. It will require the user to submit information such as a government-approved ID, proof of residence and at times proof of income to establish where the funds are coming from. All of this is to ensure safe and transparent future transactions. The procedure can be a bit long at times but is worth it in the long run.

Algorand: Long vs Short Term Investment

Investing for the short term in ALGO coins involves purchasing the tokens when the market is experiencing a dip in price. Once the market recovers, the Algorand tokens can be sold for profit. Short-term investments are done multiple times and frequently, and each time, the attempt is to buy low and sell high.

On the other hand, long-term investment may not be during a dip as the goal is to capitalise on the long-term upward trend. Small up and down movements are ignored as these can be insignificant in the overall scenario.

Buying and selling ALGO tokens using a short-term strategy can result in more opportunities for smaller profits, but also runs the risk of higher losses. A long-term investment does forgo smaller movements but a successful long term investment involves a deep understanding of the market and its movements, making it difficult to predict a good exit timing. 

Why Buy Algorand rather than Trade?

Profits can be achieved by either trading Algorand or buying the tokens. For many people, the difference may not mean much as the end goal is to make money. However, there are certain advantages to buying ALGO than simply trading it.  

Unlike trading, buying Algorand entails gaining ownership of the coins. Instead of locking up money in a trade, owning ALGO is an advantage as you can buy Algorand instantly and have possession of the tokens. While trading in the short term is advantageous as you can close your position immediately, for long term strategy, it is more advisable to buy Algorand since there are no charges to hold as opposed to brokers who may impose such fees as long as a position is open.

To retain the ease of selling, many people prefer to keep their ALGO on the platform where they purchase the tokens. While this may seem a sound option, it is a risky approach. Crypto exchange platforms are mostly centralised in nature and therefore, vulnerable to hacks and other forms of digital thefts. The best option would be to buy the ALGO tokens and move them off the exchange to a private wallet.

This means you will need to have an understanding of how crypto wallets work, including what are private and public keys, how to set transaction fees and researching the types of wallets that are best suited for you.

What Fees are Involved in Buying Algorand?

Purchase of Algorand will have a fee involved in one way or another, regardless of where you are buying it from. The amount of fee also depends on the method of purchase, the amount being bought and the platform used for purchase. Some of the different fees you may face include:

Deposit Fees

Some methods of depositing funds in your trading account will incur fees by your platform, particularly when using your debit or credit card. While your platform may or may not have its deposit fee, be sure to look up any charges from your fiat service provider (bank transfer or any other payment processor charges). These can accumulate and eat into your profits especially when frequently funding or transferring large amounts.

Withdrawal Fee

While many platforms make it attractive to have no deposit fee, especially in the case of funding through cryptocurrencies, they do however charge you for withdrawals. Compared to other cryptocurrencies, the ALGO withdrawal fee is pretty low.

Trading Fee

Brokers and exchanges are businesses and make an earning through different charges, such as the trading or buying fee. Each time you buy, sell or trade your Algorand, you will either pay a maker or a taker fee. If you are using advanced derivatives such as CFDs or make use of leverage, the platform will charge additional fees for these services.

Transaction Fee

Though negligible, there is still a small fee associated with transferring Algorand from one wallet to another. While you cannot avoid this, the good thing about Algorand is that the small fee doesn’t variate with network load and remains the same, no matter where you send your ALGO or the quantity involved.

Safely Storing Your Algorand

The priority of every investor is to safely store the cryptocurrencies that he or she has. As coins, ALGO tokens require a wallet to store them safely. There are many types of wallets that you can use. 

Web Wallet

Web wallets are only accessible through a browser. If you are using a broker or an exchange, you will already be provided with one that’s built into their services. The use of web wallets have several advantages, such as ease of access, multiple token support and the bought coins are directly deposited without any manual intervention required on part of the user. On the other hand, since the platforms hold a large volume of tokens, they are particularly a point of interest for hackers and other bad actors, making the use of these wallets risky, especially if you have a large amount stored there.

Mobile Wallet

As the name suggests, such types of wallets are designed to be used on mobile devices. They are popular due to the extra layer of security (thieves need to get their hands on the mobile first and then go through the process of cracking your mobile code or password). However, this can be of little value if you do not have a strong password or have installed a compromised app through which hackers can gain access to your funds. A few of the popular mobile wallets include the official Algorand wallet, Atomic wallet and the Exodus wallet.

Desktop Wallet

Just like mobile wallets that are installed on cell phones, desktop wallets can be used on computers and laptops. They are less convenient as compared to mobile wallets since you are not always carrying around your computer, but that can also turn out to be beneficial since that also means it is difficult for bad actors to physically get their hands on your device. Furthermore, you can always increase the protection of your computer by installing strong firewalls, 2FA and other third-party security apps.

Hardware Wallet

Also known as cold wallets, hardware wallets are by far the most secure option for storing your ALGO tokens. Hardware wallets are usually in the form of USB devices and can be disconnected from the Internet and therefore are the most secure option. Two of the most popular hardware wallets are Ledger Nano X and Nano S.

What Other Coins Can I Trade or Use to Buy Algorand?

Brokers and crypto exchanges can have different trading pairs against ALGO. This allows you to use your other crypto assets for buying ALGO. For example, you can buy Algorand with BNB. Other major cryptocurrencies such as Bitcoin, Ethereum, Ripple, Litecoin and stablecoin Tether USD are a few options that you will normally find on most platforms.

What’s the Smallest and Largest Amount of Algorand I Can Buy?

The benefit of cryptocurrencies is that they can be broken down into very small parts. However, some platforms might limit the smallest amount you can buy. 

Theoretically, there is no upper limit that exists, apart from the fact that the total number of Algorand tokens you want exists in the order books against your preferred price. Each platform will, however, set an upper limit depending on the financial laws of the jurisdiction in which it operates, and you can always refer to their trading or buying structure to find it.

While regulated exchanges demand verification of users while purchasing Algo, you can still buy ALGO without an ID. There are some ways you can buy ALGO anonymously, such as using your privately held other cryptos through decentralised exchanges (utilising swaps and smart contracts) or simply asking someone you know who holds Algorand to transfer over some to your wallet and you can pay in cash or other means and the banks or financial institutions will not know what you used the money for.

While protecting your privacy may seem something you want, it also runs the risk of being scammed. It would be much safer to buy where the identity of the buyer and seller is not hidden.

But is buying ALGO illegal? Well, the legality depends on where you reside. Some jurisdictions and countries have declared cryptocurrencies like Algorand to be illegal, while some others have no issues with it. 

Will Buying Algorand Make Me Money?

You will find several stories on the internet where people invested in the ALGO token when the price was considerably low and now have made thousands or even hundreds of thousands of dollars.

All of this does seem promising, but you should know that Algorand is a cryptocurrency and is a volatile investment instrument. You will need to invest time and effort in learning about the market trends, regulatory issues and other events that can affect its price.

If you are interested in finding out more about the price trends of Algorand, we suggest you visit our Algorand Price Page for more information.

How to Spend your Algorand

If you find a merchant or party that accepts ALGO tokens as payments, you can spend your Algorand.

Algorand still lacks the wide acceptability such as Bitcoin and Ethereum and there are no mainstream firms that accept it as a payment option, but there are hundreds of businesses that can in future, thanks to different crypto payment processors which can accept ALGO on their behalf. The Algorand network as a whole has gained immense traction and several blockchain-based platforms and companies are using its network. It is, therefore, suitable to say that large scale acceptance of ALGO is just a matter of time.

How to Sell your Algorand

Selling Algorand is a simple process. Using the same platforms that allow you to buy ALGO, you can also sell your tokens. All you have to do is to place a sell order using the different options available such as a sell market order, limit or any other. 

While the process is similar whether you opt for a broker or a crypto exchange, you will be better off using a broker and using CFDs. Since you never actually get possession of ALGO tokens using a Contract For Difference, you can immediately close your position and pocket the money.

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Frequently Asked Questions

  1. Algorand is a scientifically peer-reviewed blockchain that has been designed to offer faster and scalable financial solutions.

  2. The Algorand network and the ALGO token have gained immense attraction and popularity. Some of the largest blockchain projects are running on it.

  3. You must hold 1 ALGO in your private wallet.

  4. Not at the moment. A single ALGO token is slightly above a dollar at the time of writing.

  5. You should consult your local tax expert for the relevant laws prevailing in your country of residence (capital gains tax, for example).

  6. You will need to wait until a buyer comes along and agrees to accept your price.

  7. Despite the heavy fluctuations, long-term investment in ALGO tokens has resulted in more than 200% profit this year alone.

  8. While nothing can be said about the future, it is highly unlikely that the ALGO token will be priced as much as Bitcoin or Ethereum. However, the token has a promising future as per most veteran investors.

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