Beginner's Guide: Virtual Currency Buying and Selling Introduction Complete Process for Purchasing Bitcoin in Taiwan

Want to start buying cryptocurrencies but don’t know where to begin? Many people are interested in Bitcoin, but the complex trading processes often discourage them. This article will guide you through the core steps of purchasing cryptocurrencies, how to choose trading platforms, and a comparison of different trading methods.

Five Core Steps to Buying Cryptocurrencies

Buying cryptocurrencies in Taiwan is not complicated; just follow these steps:

Step 1: Choose the Right Trading Platform
Different platforms have different features, depending on your investment strategy. Some focus on spot trading, while others mainly offer derivatives. Select based on your needs.

Step 2: Complete Account Registration and Verification
New users need to open an account on the platform, which usually requires identity verification (KYC). This is to comply with financial regulations.

Step 3: Deposit Funds into Your Account
Platforms support various deposit methods, including bank transfers, online banking, or transferring directly from other cryptocurrencies. Funds must be deposited before trading.

Step 4: Place Orders to Buy or Trade Cryptocurrencies
After depositing, you can buy Bitcoin or other cryptocurrencies via limit orders or market orders. Different platforms may offer spot, futures, or leverage trading options.

Step 5: Withdraw Profits or Transfer Assets
After trading, you can transfer cryptocurrencies to your wallet for long-term holding or withdraw to your bank account.

Overview of Cryptocurrency Trading Platforms in Taiwan

Features and Selection of Local Platforms

Taiwan has several well-known cryptocurrency trading platforms, all supporting New Taiwan Dollar (NTD) deposits and withdrawals, which is very convenient for local users.

Key points for local platforms:

• Older platforms tend to have higher credibility
• Fee structures vary; some charge 0.05% on limit orders and 0.15% on market orders
• Not all platforms offer bank trust services
• The variety of supported cryptocurrencies varies significantly

Local platforms’ advantages include NTD support, clear regulation, and localized customer service. Disadvantages are fewer trading pairs, higher fees, and less market depth.

Advantages of International Trading Platforms

Compared to local platforms, international cryptocurrency exchanges generally feature:

Trading Volume and Market Depth
Large international platforms have daily trading volumes in the billions of USD, with fast order execution and less slippage.

Variety of Cryptocurrencies
They offer hundreds to thousands of trading pairs, providing more options.

More Competitive Fees
Transaction fees are usually lower than local platforms, sometimes as low as 0.08%.

Diverse Products
In addition to spot trading, they offer futures, options, leveraged tokens, and other derivatives.

In-Depth Comparison of Cryptocurrency Purchase Methods

There are mainly three ways to buy cryptocurrencies, each with pros and cons:

Centralized Exchanges

Centralized exchanges are like traditional stock brokers but for crypto, with user assets held by the platform. They feature a wide range of trading pairs, high liquidity, and easy operation, making them beginner-friendly. However, risks include potential platform outages or security breaches that could compromise assets.

Operation Process:
Buy stablecoins like USDT with NTD → Exchange USDT for Bitcoin → Transfer to cold wallet or hold long-term

Suitable for:
Beginners, small capital investors, those wanting quick entry

Decentralized Exchanges

Decentralized exchanges (DEXs) execute trades via smart contracts, with no middlemen, offering higher asset security and better privacy. Users manage their private keys and wallets themselves. The downsides are more complex processes, less liquidity, and longer confirmation times.

Operation Process:
Prepare wallet → Deposit crypto assets → Connect wallet → Peer-to-peer trading → Self-custody

Suitable for:
Technically skilled investors, privacy-conscious users, those with larger funds

Derivatives Trading Platforms

Derivatives exchanges mainly offer futures, options, and leveraged contracts. Investors do not need to hold actual assets but trade based on price movements, allowing both long (bullish) and short (bearish) positions for two-way trading.

Core advantages of derivatives trading:

• Use small margin to control larger positions
• Profit in both rising and falling markets
• Suitable for short-term speculation and hedging
• Flexible leverage (typically 1-100x)

Operation Process:
Register account → Deposit margin → Choose long/short → Place orders → Set take-profit and stop-loss

Suitable for:
Experienced traders, seeking short-term gains, with strong risk tolerance

Spot Trading vs Derivatives Trading

Choosing the right method depends on your investment goals:

Spot Trading Characteristics:

• Actual assets are traded, requiring wallets for storage
• Suitable for medium to long-term holding
• Can only buy (go long), not short
• Higher initial capital needed
• No leverage risk

Derivatives Trading Characteristics:

• Trading contracts, not actual assets
• Suitable for short-term speculation and intraday trading
• Can go long or short, flexible market response
• Lower initial capital needed
• Leverage risk requires careful management

Due to Bitcoin’s volatility, derivatives trading has attracted many short-term traders and professional investors in recent years. Market data shows that global derivatives trading volume has far surpassed spot trading volume.

Risks to Know Before Buying Cryptocurrencies

Before investing, understand these risks:

Market Volatility Risk
Bitcoin and other cryptocurrencies can experience sharp price swings, with rapid rises and falls.

Leverage Trading Risk
Leverage can amplify gains but also losses. Improper use may lead to account liquidation.

Platform Risk
Even reputable platforms may face technical issues, security breaches, or regulatory challenges.

Operational Risk
Novice traders may make mistakes due to unfamiliarity or emotional trading, leading to losses.

How to Choose Purchase Methods Based on Investment Goals

For Beginners
Start with local centralized exchanges to familiarize yourself with basic operations. Buy small amounts to experience the market before increasing your investment.

Prioritizing Security and Privacy
Decentralized exchanges are better, despite their complexity, because assets are fully under your control and privacy is protected.

For Experienced Traders
Derivatives platforms offer more flexibility and opportunities. Use leverage for intraday, swing trading, or hedging.

Long-term Holders
Any spot trading platform is suitable; focus on choosing a secure, well-regulated platform.

Time Frames for Different Trading Strategies

Your trading style influences your cryptocurrency purchase strategy:

Super Short-term Trading (Intraday)
Frequent small buy/sell actions based on minor price movements. Suitable for experienced traders with time and technical skills. Higher fees and requires precise analysis.

Medium to Short-term Trading (Weeks to Months)
Set profit and stop-loss points based on technical and fundamental analysis. Risk is more manageable, suitable for part-time investors.

Long-term Investment (Months to Years)
Buy and hold based on long-term outlooks. Use spot platforms and transfer assets to your wallet for long-term storage.

Practical Steps: Typical Process for Buying Cryptocurrency

Suppose you decide to trade Bitcoin on a platform:

Step 1: Open a Trading Account
Register and verify your identity. Many platforms offer demo accounts for practice without real funds.

Step 2: Deposit Funds
Choose a suitable deposit method based on your planned investment amount. Initial deposits may have limits.

Step 3: Familiarize with the Trading Interface
Practice placing orders, setting stop-loss/take-profit, and viewing charts in demo mode.

Step 4: Develop a Trading Plan
Before real trading, define your goals, risk tolerance, and stop-loss levels.

Step 5: Execute Trades
Based on market analysis, place buy or sell orders. Always set stop-loss to manage risk.

Step 6: Monitor and Adjust
Regularly review your positions and adjust take-profit or stop-loss as needed.

Frequently Asked Questions

Q1: Can I buy cryptocurrencies with a credit card?
A: Many international platforms support credit card deposits, but fees are higher. Most local platforms do not support credit cards, relying on bank transfers.

Q2: What is a stablecoin, and why buy USDT first?
A: Stablecoins (like USDT) are pegged to USD, with stable prices. Buying stablecoins first helps avoid exchange rate risks, increases trading flexibility, and simplifies switching between trading pairs.

Q3: Can cryptocurrencies stay on trading platforms?
A: Short-term holdings are fine, but for long-term storage, transfer to your own cold wallet is recommended. Platform custody carries risks; self-custody is safer.

Q4: What does 1:10 leverage mean?
A: It means you can trade 10 times your margin with 1 unit of your own funds. Both gains and losses are amplified.

Q5: How to determine the right buy/sell timing?
A: Use technical analysis (charts, indicators) and fundamental analysis (news, policies). Set disciplined entry and exit rules to avoid emotional decisions.

Summary and Recommendations

The best way to buy cryptocurrencies varies per individual:

• Beginners should start with local centralized exchanges with small funds to learn the process
• Long-term investors should buy spot and self-custody to avoid platform risks
• Experienced traders can explore derivatives trading but must implement proper risk management
• Always set stop-loss orders to control risks regardless of method

Cryptocurrency markets involve risks and opportunities. Before investing real money, thoroughly learn market knowledge, practice in simulation environments, and ensure you understand each trade. Most importantly, only invest what you can afford to lose. Never treat crypto investing as a get-rich-quick scheme.

Now you have mastered the complete framework for buying cryptocurrencies. The next step is to choose a suitable platform and method, start small, and gain experience. Remember: caution, learning, and practice are the three steps to success.