What is crypto investing and how do you buy cryptocurrencies?
Discover the volatile – and risky – cryptocurrency markets. Learn how to buy and own coins with a spot crypto account and then see an example of buying Bitcoin.
Call 0800 195 3100 or email newaccounts.uk@ig.com to talk about opening an account.
What is cryptocurrency investing?
Cryptocurrency investing is the buying and selling of cryptocurrencies on an exchange. You can buy and hold coins via a spot crypto account, with your crypto held by our partner Uphold.
You’ll take beneficial ownership of the crypto — and you’ll profit if you sell your coins when the price rises beyond the original buy price — or suffer a loss if the price falls. This provides a straightforward way to build your cryptocurrency portfolio without the complexity of external wallets or exchanges.
How do cryptocurrency markets work?
The cryptocurrency market is a decentralised digital currency network, which means that it operates through a system of peer-to-peer transaction checks, rather than a central server.
When cryptocurrencies are bought and sold, the transactions are added to the blockchain – a shared digital ledger that records data – through a process called ‘mining’.
What moves cryptocurrency markets?
Cryptocurrency markets move according to supply and demand. While cryptocurrencies are decentralised and operate independently of central banks, they can still be influenced by the same broader economic and political developments that affect traditional currencies. While there is still a lot of uncertainty surrounding cryptocurrencies, the following factors can have a significant impact on their prices:
- Supply: the total number of coins and the rate at which they’re released, destroyed or lost
- Market capitalisation: the value of all the coins in existence and how users perceive this to be developing
- Press: the way the cryptocurrency is portrayed in the media and how much coverage it is getting
- Integration: the extent to which the cryptocurrency easily integrates into existing infrastructure such as e-commerce payment systems
- Key events: major events such as regulatory updates, security breaches and economic setbacks
Learn why people invest in cryptocurrencies
Cryptocurrencies are notoriously volatile, with large and sudden price movements presenting opportunities for profit. At the same time, you’re exposed to a lot of risk and can make significant losses if the price drops suddenly.
Through our third party partner Uphold, you can access cryptocurrencies via a spot crypto account – enabling you to buy and beneficially own your chosen cryptocurrency until you choose to sell it again. Prices are quoted in GBP, and you’ll take beneficial ownership of the cryptocurrency itself.
When buying crypto, you can:
- Access real-time pricing: we derive our prices from our partner Uphold, which continually surveys prices at up to 30 underlying trading venues including centralized exchanges, decentralized exchanges and OTC brokers.
- Get prices reflective of the underlying market: because our prices are based on real markets, in real time, they always reflect actual market sentiment
- Buy to own: with our spot crypto account, you’ll beneficially own cryptocurrency, or fractions thereof, rather than trading the underlying asset
- Use continuous charting: our award-winning platform1 offers cutting-edge HTML 5 charts and a selection of advanced indicators and drawing tools
- Enter and exit positions: our execution enables you to open and close trades efficiently when market opportunities arise
- Trade on a reputable platform: you can utilise measures such as the two-factor authentication (2FA) when investing online, though it’s important to be aware of the standard crypto risks
Pick a cryptocurrency to invest in
You can use your crypto account to trade 35+ major cryptocurrencies and two crypto crosses.
Our selection includes:
- bitcoin
- ether
- bitcoin cash
- Litecoin
- EOS
- Stellar
- Cardano
- bitcoin cash/bitcoin
- ether/bitcoin
- Cardano
- Chainlink
- Polkadot
- Dogecoin
- Uniswap
Open a spot crypto account to start investing
Opening a spot crypto account usually takes minutes. And there’s no obligation to fund your account until you’re ready to trade.
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Open your position
Once you’ve chosen the crypto you want to buy, select it and enter the amount (in pounds) that you want to spend on the coin. You’ll automatically see the equivalent in crypto that you’ll get for that amount — this will include our sole fee, which stands at a flat 1.49% spread. Then, review and confirm your order. The crypto will immediately reflect in your account.
Monitor and close your position
You may want to close your position to realise a profit or avoid further losses. Navigate to your portfolio, select the crypto you want to sell and enter the value (in pounds) that you want to sell. Then, review and confirm the sale.
Buying cryptocurrency: bitcoin example
After completing thorough analysis on bitcoin price movements, you believe the market will trend upwards from its current level of 75,400. Consequently, you decide to buy bitcoin using your spot crypto account.
In this example, you decide to invest £500 in bitcoin. When making your purchase, our 1.49% flat spread fee is automatically deducted from your investment amount. This means if you deposit £500, you'll receive slightly less than £500 worth of bitcoin after the fee is deducted.
Let's say you receive 0.00662 bitcoin. Since this is a spot crypto account, you now enjoy beneficial ownership of this bitcoin in your account, held by our partner Uphold.
The market moves as you predicted, with bitcoin rising to a level of 83,000. At this point, you decide to sell your bitcoin and realise your profit. Your 0.00662 bitcoin is now worth £549.46. After deducting another fee for selling, your net proceeds would be approximately £548.71, giving you a profit of £48.71 – a return of about 9.7% on your initial investment.
Suppose, however, that the market instead decreased to 70,000, and you decided to sell your bitcoin at this price. Your 0.00662 bitcoin would be worth £463.40. After the selling fee, your net proceeds would be £462.65, resulting in a loss of approximately £37.35 (7.5% on your investment).
Please be aware that these numbers are for illustration only.
FAQs
How do I start investing in cryptocurrency?
To get started, follow these steps:
- Understand what crypto investing is
- Learn why people trade cryptos
- Pick a cryptocurrency to trade
- Open a spot crypto account
- Identify a crypto investing opportunity
- Place your trade
- Monitor and close your position
If you're ready to trade, open an account.
How much money do I need to start investing in cryptocurrency?
Cryptocurrency investing is inherently high risk – the markets are volatile, which could mean large and sudden market movements. You should always ask yourself whether you can afford the risk of monetary loss, and if so, how much?
How can you invest in cryptocurrency with us?
We offer cryptocurrency investing through our spot crypto account, which enables you to buy and sell actual crypto coins. When you buy cryptocurrency, you take beneficial ownership of the digital assets after paying their full value upfront.
This approach means you're investing in the cryptocurrency itself. You'll enjoy beneficial ownership of the coins, which you can hold as a long-term investment or sell when you believe the price is more favourable.
Our spot crypto account provides a straightforward way to build your cryptocurrency portfolio without the complexity of external wallets or exchanges.
Can crypto investing be profitable?
Yes, like any market, investing in cryptocurrency can be profitable. However, cryptocurrency markets are exceptionally volatile – meaning that they’re high risk. Whereas large price movements in your favour could result in positive returns, sizeable price movements against your position could result in rapid and significant losses.
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Important to know
The footer below includes standard risk disclosures and regulatory information applicable to IG’s broader range of investment services, including regulated financial instruments.
This page relates to unregulated crypto products, which are not covered by the Financial Conduct Authority (FCA) and do not benefit from regulatory protections such as the Financial Services Compensation Scheme (FSCS) or the Financial Ombudsman Service (FOS).
Please ensure you understand the specific risks associated with unregulated crypto assets.
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