You can purchase crypto and hold onto it until your children reach adulthood. But, all reputable securities exchanges in the US require investors to be at least 18 years or older to invest; crypto is no different. Children are not allowed to buy, sell or trade securities of any kind until they reach the age of maturity. So, how to buy bitcoin for kids?
Before telling you how to buy Bitcoin for kids, I would like to remind you that when you buy crypto, there is no bank involved. So, if it's lost or stolen it's gone forever, just like if you lost cash. Therefore, one safe solution for buying crypto for your children is to purchase it and then store it in a "cold wallet." Crypto wallets allow for crypto to be sent to a specific address. It allows you to then send crypto to someone else when you're ready. Wallets can be either hot or cold.
Where to Buy Crypto?
Now that you know where to store crypto for your children, it's important to get familiar with the buying process. So, following these few simple steps will take the confusion out of the process.
Select a Currency Exchange or a Broker
A cryptocurrency exchange connects buyers and sellers. Exchanges such as Coinbase, Gemini, and Binance us provide relatively low-fee, user-friendly trading options. Keep in mind, if you're a beginner trader, you should choose an exchange or broker that offers fiat current purchases and transfers with US dollars.
Create and Set Up Your Account
After you have considered your options and chosen a cryptocurrency broker or exchange, it's time to sign up and open an account. You may have to verify your identity based on which platform you choose and the amount you want to purchase. Verifying your identity meets federal requirements and helps prevent fraud.
Make sure you have funds in your account in order to purchase crypto. You may be required to link your bank account and make a deposit into your crypto account. Otherwise, you can make the deposit with a debit or credit card or authorize a wire transfer. Depending on which broker, exchange and method of funding, you may have a waiting period of up to a few days before your funds can be used to purchase cryptocurrency.
Take caution, though; while some brokers or exchanges permit deposits from your credit card, it can be expensive with a very high risk. This is because cryptocurrency purchases on your credit card are considered cash advances by your card company. Cash advances normally carry higher fees than a normal purchase, and you're subject to further cash advance fees.
This doesn't include any fees that your crypto exchange or brokerage charges you. Those fees themselves can be up to 5%, indicating you may possibly lose up to 10% of your crypto purchase to fees alone.
Place Your Crypto Order
Once your account is ready to go, you can buy crypto. There are many different types of cryptocurrencies to invest in.
Here are the biggest cryptocurrencies:
- Bitcoin (BTC)
- Ethereum (ETH)
- Tether (USDT)
- Binance Coin (BNB)
- Cardana (ADA)
- Dogecoin (DOGE)
- XRP (XRP)
- USD Coin (USDC)
- Polkadot (DOT)
- Uniswap (UNI)
After you purchase your shares, you can transfer them to your cold wallet. Again, if you use a broker, make sure they don't restrict the transfer of currency.
I hope now you know how to buy bitcoin for kids!
