While cryptocurrencies are coming under the hammer of governments worldwide, Portugal is pulling in the opposite direction. The country is opening up to virtual assets faster than any other European country. For example, there is a Golden Visa program where interested citizens can pay for the services in Ethereum (ETH), Bitcoin (BTC), Ripple (XRP) and more.
Also, more people in the country are growing curious about owning cryptocurrency. If you are interested in buying cryptocurrency in Portugal, this guide will take you through the entire purchasing process and discuss various payment options.
Being the most crypto-friendly jurisdiction in the European Union (EU), Portugal is the target of many cryptocurrency vendors.
If your strategy is short-term, then a cryptocurrency broker is an appropriate platform to buy cryptocurrency. Brokers sell cryptocurrency derivatives, which you can open and close positions in a matter of minutes.
On the other hand, an exchange platform is an appropriate platform if your investment strategy is the long-term holding of the tokens. You can hold the coins for a long time because you have a claim on real assets. This means the exchange will deposit the coins in your account’s wallet or you can transfer them to a private wallet.
Given the number of exchange and broker platforms in Portugal, it could be daunting for new customers to find the best place to transact. Fortunately, we researched for many available options and compiled a list of the best platforms for your convenience. These are given below.
Portugal is a cryptocurrency hotspot, but we know that not everyone can find their way through the market. As such, we took the trouble to condense the process of buying cryptocurrency in Portugal into five basic steps, as discussed below.
There is no ‘right’ or ‘wrong’ place to buy cryptocurrency in Portugal, for starters. Instead, the appropriateness of a trading platform depends on your personal needs.
For example, a broker platform is appropriate if you wish to wager on the price volatility of cryptocurrency. As such, traders can take as many positions at any time as their funds can allow. Also, this means traders do not have to worry about the storage of the coins.
However, the scenario changes once your needs shift to HODLing. To HODL is to buy actual cryptocurrency coins to hold for an extended period, often months and even years. The underlying idea of HODLing is to exploit the long-term growth of the given digital currency.
The appropriate platform to buy coins for HODLing is the cryptocurrency exchange. A cryptocurrency exchange is like a market, where buyers and sellers meet and exchange one token for another, or one token for fiat currency, or vice versa.
But your personal needs should not be the only bottom line to select the right platform. In addition, you should also consider the regulatory status of the broker or exchange. A regulated platform comes with an official guarantee of safety.
Once your mind is settled on the ideal platform, the next step is to open an account. Thankfully, this is the easiest hurdle you will have to jump.
A typical account registration process begins at the registration window – where you will be prompted to fill two boxes, the first one with your full name and the other with address details. Some platforms ask for a mobile phone or email address only, but others might ask for both.
After you hit ‘SUBMIT,’ the platform opens an account, but it is not active just yet. To activate the account, the exchange or broker will ask that you upload a photo ID and a picture of the bank statement for the last three months. The documents will be used to complete the KYC (know-your-customer) process.
As the phrase suggests, the KYC process helps the exchange or broker to identify the new client. In addition, the law requires the platforms to explain the nature of their dealings with the clients, which means they must know who they are, where they come from, and their primary intention of opening an account.
When using a broker platform, making it through the KYC process only activates the account. An active account can access the market through the demo feature, but not all platforms offer it. For live trading, you must fund the account.
In Portugal, traders have an endless range of payment options to fund their accounts. For example, you could use PayPal for convenience or a credit card for faster transactions.
Also, it is worth noting that different trading platforms support different payment options.
You can start trading once the funds reflect into your account. It helps to know that the time it takes for the funds to reflect varies depending on the payment method used.
The account enables you to trade with the given coin via derivatives, such as futures and CFDs. This means buying a preferred cryptocurrency pair and specifying the order size, as well as the leverage ratio.
On the contrary, exchanges allow you to make spot purchases of the given cryptocurrency. Spot purchases culminate in the exchange sending actual tokens into your account, and these coins need storage.
You can store the coins in the account’s wallet, especially if you need quick access. However, you should send the coins into a private wallet if you intend to HODL. Keeping the coins in a private wallet extends more control over the coins to you, and their security is also in your hands.
While at it, please be reminded that some brokers such as eToro operate as exchanges, meaning they enable clients to buy cryptocurrency on the spot. Similarly, some exchanges such as Binance offer cryptocurrency derivatives trading.
There is more you can do after purchasing cryptocurrency:
If you purchased the digital currency for HODLing, it would be reasonable to move the coins into a private wallet for better security and more control. Also, you could offer the coins for staking, if possible. Staking helps to maintain the security of given blockchain systems for your profit.
In the case of a trading position, the next step should involve risk management. Managing risk means protecting your position from sudden adversarial moves in the market. One way to manage risk is through hedging. For example, you could open a position in the derivatives market to hedge against potential loss.
We cannot say with confidence that a payment method suits you, mainly because everyone defines ‘best’ based on personal preferences. For example, PayPal could be the best payment method for someone that needs convenience, while bank transfers suit one who desires impregnable security.
The good thing is that you have an endless pool of payment options in Portugal. In addition, the country’s stature as a home to innovative financial institutions has enabled countless payment service providers to thrive.
Buy Cryptocurrency with Cash: Bitcoin ATMs in Lisbon enable buyers to enjoy immediacy, flexibility, and security when purchasing crypto.
Buy Cryptocurrency with Credit Card: You can buy crypto instantly with a credit card without having all the cash on hand.
Buy Cryptocurrency with Bank Transfer: Offers robust security when transacting, but be ready to wait for longer to complete transactions.
Buy Cryptocurrency with PayPal: This gives you access to a vast number of cryptocurrency sellers.
Bitcoin is the most widespread cryptocurrency, but many companies have issued their own versions, often called tokens. There were 10,945 tokens at the time of writing, according to CoinMarketCap. Altogether, the coins are worth $1.26 trillion.
According to Forbes Magazine, cryptocurrencies obtain their value from their use cases, supported by the underlying technology, blockchain.
The technology records transactions on a distributed ledger that is open for everyone on the network to verify. In addition, each blockchain system has a native token to facilitate transactions among peers. For example, BTC enables peers on the Bitcoin blockchain to transfer value and settle transactions.
Most importantly, blockchain technology uses the nodes on the network to prevent fraud. For example, most of the nodes on the platform must verify a transaction before it is added to the unified transaction record. Also, the system is set up so that a single node cannot alter the details of previously recorded transactions.
Other benefits of the technology include trust, reduced transaction costs, improved privacy and security, traceability of transactions, and more. Interestingly, the merits of the technology are creating many use cases across numerous industries worldwide. This is one of the reasons cryptocurrencies are gaining value.
For example, the total capitalisation of the cryptocurrency market in 2021 year-to-date is up 66% to $1.29 trillion. However, in the same period, the PSU 20 Index returned a mere 2.69%. This scenario supports the case for cryptocurrencies against the Portuguese equities market. As such, the crypto market is worthy of any investor’s attention looking to diversify their portfolio.
Additionally, cryptocurrencies are gaining mainstream usage at a steady pace. This is mainly because of a positive attitude by the country’s financial regulators. At this pace, there is a chance that cryptocurrencies like Bitcoin might become legal tender.
If so, the digital currencies will become priced assets in Portugal in the future. Unfortunately, the assets would be too expensive for those who missed the chance to enter the ecosystem early. By this logic, it looks like the best time to buy cryptocurrency in Portugal is now.
Although Portugal lacks definitive cryptocurrency laws, the country’s central bank does not prohibit purchasing, holding and selling digital assets. In fact, Banco de Portugal, the central bank, issued a statement recently in which it permitted two cryptocurrency exchanges to operate legally. However, the institution does not recognise digital assets as legal tender. Read more about cryptocurrency laws and taxation in our Portugal tax guide.
According to our research, there are various Bitcoin ATMs in Lisbon where you can spend the tokens. However, we could not establish whether the ATMs accept other tokens such as Ethereum (ETH), Litecoin (LTC), and more. Additionally, we could not find any major brands that accept cryptocurrency, despite days of detailed research.
But there is good news. We established that thousands of enthusiasts have put up their cryptocurrency holding up for staking on numerous exchanges. Also, some use their coins to facilitate the governance of given blockchain systems.