Bitcoin, Etherum, Litecoin. You’ve heard of them all and you’re here, reading this article because you want to buy some Bitcoin or other cryptocurrency with fiat currency (USD, EURO). If you have never done this before, it’s not hard at all. There are several websites where you can exchange fiat for crypto or vice versa.
How do I crypto for money?
You cannot. You have to spend fiat currency in order to get cryptocurrency because there are companies out there that only deal with traditional money. These companies usually have websites where you can register your bank account or credit card details so you can exchange U.S Dollars or British pounds for cryptocurrencies such as Bitcoin, Ethereum, Litecoin, etc.
For example, if you live in Europe and want to get some Bitcoin with Euros, go to the website of your cryptocurrency exchange of preference, say Crypterium. If you don’t have an account yet, don’t worry. Making it is easy and the process is super easy. After that just enter the amount of EURO, USD, or whatever currency your credit card has, and then you can convert into BTC or Ether, optionally add a code, and press “buy”. The coins will be sent directly into your wallet after the purchase has been confirmed by both parties: You and the exchange. The process is similar when using other exchanges too.
Now you know where you can go to exchange fiat currency for cryptocurrency, but remember this is not the only way. Shops and merchants are increasingly accepting cryptocurrencies as a form of payment along with your fiat money. Thus in many places, it is possible to buy goods using crypto.
Shopping with crypto
To do that you need to open an account at one of the multiple online stores or shops that accept cryptocurrencies (for example Crypterium). After that, when shopping simply chooses the cryptocurrency of your choice from the dropdown list before checking out. A QR code will appear which you have to scan within your wallet app on your phone or tablet so the right amount already converted into BTC etc. gets transferred to the shop’s cryptocurrency address.
That’s it. Your transaction will be verified in a few minutes or hours depending on the store you are purchasing from and how busy their blockchain is at that moment. The cryptocurrency address is what stores use to identify themselves so there’s no danger of giving away your private keys when making purchases because you never enter them online anywhere, instead just scan QR codes with your phone.
What is fiat currency?
Fiat money is any type of currency that governments and financial institutions choose it to be. It is given its value by those entities, not by how many coins or banknotes exist as with traditional money such as the U.S. dollar or the British pound. The term comes from Latin fiat meaning “let it be done”. So when you hand over cash in exchange for goods, you are trading your goods for legal tender which can then be traded again at a later date for other goods.
Fiat currencies have no intrinsic value, only the faith that someone has put into government promises makes it a “thing of value” which one can exchange for goods and services. So basically everything is a matter of faith but the difference between fiat and crypto is that with crypto, you take full control of your funds whereas with fiat it’s regulated by the government. In addition, there are no hidden transaction fees or limits on how much money you can move around as long as you have internet access. Crypto-currencies offer a great alternative to fiat currencies because they don’t try to mess with your privacy nor make arbitrary rules.
Why are governments able to dictate how it works?
It is because they have the power of law behind them. If you feel that fiat currency has no value, try defaulting on a debt denominated in U.S. dollars or try printing extra money to pay off debts. Either way, your country will go through a financial crisis before things get better and probably even worse after things start improving as there may be hyperinflation involved if too much fiat currency is available for spending. This doesn’t happen with crypto as mining new coins require expensive equipment and there are only so many coins available (the total number increases every year but never surpasses 21 million). There can also be control over who has access to those coins and how it is spent.
If you happen to live in a country that does not have many options for money transactions then the only thing left is to ask yourself this question: Do I want complete financial freedom? If so, welcome to the crypto world!