Invest in Blockchain UK – How to Invest in Blockchain UK For Beginners
There are thousands of blockchain assets in the cryptocurrency arena – resulting in a global trading scene that is now worth over £1 trillion. If you’ve been in the cryptocurrency space for a while, you’ve likely come across many of these assets.
However, if you’re a beginner looking to understand how to invest in blockchain in the UK, this guide will explain everything you need to know.
#1 Broker to Invest in Blockchain UK – eToro
How to Invest in Blockchain UK – Choose a Broker
If you want to invest in blockchain in the UK, you must first choose a broker that supports cryptocurrencies. Notably, it’s crucial to ensure you select a regulated broker that will make the investment process safe and secure.
Below are the best brokers to invest in blockchain in the UK.
- eToro – Overall Best Broker to Invest in Blockchain in the UK
- Capital.com – Gain Access to 200+ Blockchain Markets at 0% Commission
- AvaTrade – Credible Broker to Trade Blockchain Assets with Leverage
Further down in this guide, you’ll find full reviews of the above top-rated brokers.
How to Invest in Blockchain UK – A Quick Guide For 2021
One of the most crucial aspects of how to invest in blockchain in the UK is understanding the steps involved. When you know about the fundamentals, you can complete the investment process within a matter of minutes.
An FCA-regulated broker like eToro is a good option here – as you can invest in over 30+ blockchain assets at low fees. Here’s a quickfire overview of how to complete the process from the comfort of your home.
- Step 1: Open an Account with eToro – By visiting the eToro website, you can complete the registration process by entering your personal details and choosing a username and password.
- Step 2: Upload Your ID – eToro is an FCA-regulated broker, meaning you have to provide identity documents. This can either be a passport or driver’s license, alongside a recently issued proof of address (e.g. utility bill or bank account statement)
- Step 3: Make a Deposit – Before you can invest in blockchain assets, you’ll need to add funds to your account. On eToro, the minimum required here is $50 (about £36) and you can use your debit/credit card for this purpose. Alternatively, you can use any of the supported e-wallets or a wire transfer.
- Step 4: Invest in Blockchain UK – On eToro, you’ll find the ‘Trade Markets’ button. Next, click on ‘Crypto.’ Then, you’ll proceed to choose the blockchain asset in which you want to invest. Following that, the broker will direct you to the order box where you’ll enter your stake and complete the investment.
The steps above might appear a bit complete for those investing in blockchain assets for the first time. With this in mind, further down in this guide you will find a more comprehensive walkthrough.
Cryptoassets are highly volatile unregulated investment products. Proceed at your own risk.
Where to Invest in Blockchain UK – Full Broker Reviews
The digital token market is filled with numerous platforms offering brokerage services. There are hundreds of brokers and exchanges that allow you to invest in blockchain assets. Nonetheless, it’s important to carefully assess these platforms before deciding on which to choose.
However, this process can be time-consuming, especially if you’re a beginner who wants to invest in blockchain assets in the UK quickly. As such, our research team has examined the market to determine the top brokers you can use to complete your investment.
1. eToro – Overall Best Broker to Invest in Blockchain UK
Perhaps the most important feature of this broker is that it’s regulated by multiple financial bodies including the FCA and the SEC. This impacts the level of credibility the broker has in the marketplace. Additionally, when it comes to choosing a blockchain asset in which you can purchase, this broker provides dozens of tokens. In even better news, the provider allows fractional investments, as you can start buying blockchain assets from just $25 (about £18) irrespective of the full market price.
Some of the most popular blockchain assets listed at eToro include Dogecoin, Bitcoin, Ripple, Ethereum, Chainlink, and more. Therefore, suppose you decide to invest $100 in Ethereum — with a trading price of $4,119 at the time of writing in late October — you’d own about 2.4% of one ETH. Essentially, this means that the broker supports investors of all shapes and sizes. In addition, the broker stands out in terms of its fee structure. Following our research, we found that eToro is a spread-only broker when it comes to blockchain assets.
This means that you won’t incur commissions that many other platforms charge. Instead, you simply have to pay the spread between the ‘ask’ and ‘bid’ price. Once you make a minimum deposit of $50 through any of the supported payment methods, you can proceed to invest in your desired blockchain asset. Notably, asides from debit/credit cards, the broker also supports e-wallets and the fee you incur for all payment options is just 0.5% of the transaction amount.
Another notable feature of the eToro platform is that the provider seeks to make the process easy for inexperienced investors. If you’re looking to invest in blockchain assets in the UK, you can utilize eToro’s copy trading feature to operate your portfolio in a passive manner. This feature allows you to copy the positions of an experienced investor in a fully automated way. Notably, however, to utilize this feature, you’ll have to make a $500 minimum investment (about £360), albeit, no additional fees apply.
Furthermore, eToro also has a research section that you can use to know more about the blockchain asset you’ve chosen. This section of the broker’s website is tailored to each individual asset and contains relevant information that can inform the position of investors. You can also gain access to a social platform when you use this broker. Here, you can interact with many other investors and further understand relevant market news.
- Invest in cryptocurrencies on a spread-only basis
- Minimum investment per trade from just $25
- Supports debit/credit cards, online banking, and local bank transfers
- Regulated by the FCA, SEC, CySEC, and ASIC
- 20 million+ clients
- Highly suitable for newbies
- Features a copy trading tool and a social platform
- Advanced traders might consider the platform too basic
- No support for MT4 or MT5
Cryptoassets are highly volatile unregulated investment products. Proceed at your own risk.
2. Capital.com – Gain Access to Blockchain Assets at 0% Commission
Capital.com is an easy-to-use CFD broker that allows you to gain access to blockchain assets without taking ownership of the underlying tokens. When you decide to use this provider, you don’t have to worry about finding a secure wallet. This makes the broker highly suitable if you’re looking to invest in blockchain assets within short intervals. Additionally, this broker allows you to go long and short, meaning you can attempt to secure profits from a blockchain asset irrespective of how the price moves.
To get started with Capital.com, you’ll need to first make a minimum deposit of £20 if you’re using a debit/credit card (£250 for bank wire). Following that, you can proceed to open positions on the blockchain asset you want. When doing this, you can choose to apply leverage to your trades. This feature allows you to increase your purchasing ability, meaning you can open trades with more than you have in your account.
Furthermore, Capital.com allows you to gain access to over 200+ blockchain asset markets. The broker supports thousands of alternative markets, including stocks, ETFs, commodities, indices, and forex. When it comes to fees, you won’t be charged any commissions to trade at Capital.com – which is a major benefit. Additionally, the broker has extensive educational resources and chart indicators that you can leverage to make informed decisions when you’re entering new markets.
- Experienced traders might consider the CFD broker too basic
- $250 minimum deposit on bank transfers
- Cryptocurrency CFDs not available to UK retail clients
Spread bets and CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 76.25% of retail investor accounts lose money when trading spread bets and/or CFDs with this provider.
3. AvaTrade – Credible Broker to Trade Blockchain Assets with Leverage
AvaTrade is another broker that allows you to trade blockchain assets online. A notable feature about the broker is that all markets are tradeable at 0% commission, which is a factor many investors consider when assessing a platform. Furthermore, the end-to-end investment process at AvaTrade takes under five minutes – owing to the platform’s simple interface. Once you create an account and verify your identity, you can proceed to gain access to your chosen market.
Additionally, the broker is licensed in seven jurisdictions, which is an indication of the credibility the platform enjoys in the digital tokens space. AvaTrade is also a CFD broker, meaning you don’t take ownership of assets when you complete purchases. Instead, you trade based on the underlying value of these blockchain assets. The leverage feature also applies here if you’re looking to amplify the size of your positions. However, you should exercise some care when applying leverage, as the feature can cause you to incur substantial losses.
Additionally, AvaTrade has various charting options and technical indicators that you can utilize to have a better understanding of the markets. The broker also provides you with a demo account which is useful for beginners who want to attempt trading and investing without using real money. This is in addition to being compatible with different trading platforms such as MT4 and MT5.
Trading CFDs and FX Options entail risk and could result in the loss of your capital.
How to Invest in Blockchain UK – Detailed & Explained in Full
You’ll need a comprehensive explanation of how to invest in blockchain in the UK if you’re a beginner. Therefore, while the brief walkthrough earlier might suffice for experienced investors, we have prepared this section to answer all questions you might have as a newbie.
Using the best FCA-regulated broker in the UK marketplace — eToro — here are the steps you should know about to invest in blockchain assets.
Step 1: Open an Investment Account
The entire investment journey starts with creating an account with eToro. This can be done by visiting the broker’s homepage. After clicking ‘Join Now,’ the broker will provide you with some boxes that you have to fill, as indicated in the image below.
After filling in the required information and choosing a username/password, eToro will strive to understand your prior trading experience and risk appetite. Following the completion of these questions, your account will be created accordingly.
Cryptoassets are highly volatile unregulated investment products. Proceed at your own risk.
Step 2: Upload ID
eToro is a regulated broker that’s approved by the FCA in the UK and four other financial bodies. Therefore, the broker is expected to comply with KYC laws, meaning all users must upload identity verification documents.
Therefore, to complete this step, you’ll have to upload a valid ID and a document containing your home address.
Step 3: Deposit Funds
You’ll have to add some funds to your account if you want to invest in blockchain assets. The minimum amount you’re required to deposit is $50. For this purpose, you can use your debit/credit card, an e-wallet, or you can utilize a bank transfer.
Notably, when you use any of these options to make a deposit, eToro will charge you 0.5% in fees. This is a notable feature, not least because cryptocurrency brokers like Coinbase charge 3.99% in fees when investing in blockchain assets using a debit/credit card.
Step 4: Search for Blockchain Assets
Once you’ve decided on the blockchain asset that takes your interest, the next step is to search for the token. Here, you simply have to enter the name of the blockchain asset into the search box.
Once eToro displays the asset, click ‘Trade’ to proceed to the next step. However, suppose you’ve yet to decide on the blockchain asset you want, then you can read up on various projects to gain more insights.
Step 5: Invest in Blockchain Assets
This step will present you with a user-friendly order box for entering your stake. Note that the minimum amount you can enter here is $25.
Once you enter your stake and confirm your order, you can then proceed to open your investment. Once the purchase is completed, eToro will have your blockchain tokens ready in your portfolio.
How to Sell Blockchain Assets
A notable barrier that many newbies face in the blockchain assets space has to do with the sale of their tokens. To realize your profits, you must understand the process involved when cashing out. The good news here is that eToro makes this process easy and you can complete it by following the steps below.
- When you invest in blockchain assets using eToro, the broker stores the tokens in its in-built wallet.
- Therefore, when you want to sell, you simply have to log into your account.
- Then visit your portfolio, where you’ll create a sell order.
- Once you do that, the broker will process the order and complete your sale.
Following that, your cash balance will reflect the funds and you can elect to process a withdrawal via the supported payment options.
Ways to Invest in Blockchain Assets
If you want to invest in blockchain in the UK in the most secure manner, perhaps you should consider using a regulated broker. Nevertheless, to become a pro-investor, it’s crucial to have an understanding of the various options through which you can invest in blockchain assets.
ATMs for Investing in Blockchain Assets
There are ATMs in the UK that allow you to invest in blockchain assets. This means that you’ll have to visit the ATM terminal to make use of the service. The major drawback, however, is that most of these ATMs only support major blockchain assets such as Bitcoin, Ethereum, and Litecoin.
Nonetheless, the process involved when using an ATM is as follows:
- Look for a cryptocurrency ATM close to your location.
- Once you find one, proceed to select the blockchain asset in which you want to invest.
- Then, you’ll determine how much you intend to invest. In most cases, this will be in multiples of £10.
- Then, the ATM will show you the asset equivalent of the stake you entered.
- Following that, you’ll insert the cash into the ATM and your transaction will be completed.
- The assets will be transferred to your wallet address after that.
Another drawback of this option is that the cost you’ll incur is often high. Chances are that you’ll incur between 10-15% of the transaction amount when using an ATM to invest in blockchain assets in the UK.
Use a Broker to Invest in Blockchain UK
Perhaps the best way to invest in blockchain in the UK is to use a broker. In most cases, these platforms are regulated and often have an established scope of operations. You might want to consider a broker if you’re looking to invest with a debit/credit card – as unregulated platforms are unable to facilitate this payment method.
The best brokers are not only credible but also cost-effective. This is why eToro is worth considering, as the broker doesn’t charge commissions and the spread starts at just 0.75%. Most importantly, eToro is authorized and regulated by the FCA.
Use an Exchange to Invest in Blockchain UK
There are hundreds of exchanges in the blockchain assets space and you can choose to invest through any of the available options. In most cases, what draws the attention of investors to exchanges is the absence of heavy regulation and super low fees. This means that you can invest anonymously without having to go through KYC steps.
However, when you’re investing in blockchain in the UK, it’s crucial to prioritize the security of your funds. Since most exchanges are unregulated, it can be difficult to ascertain the standards by which the platform you’ve chosen operates.
As such, if anything happens that compromises your funds, you might have nowhere to seek redress. This is why brokers stand out as the preferable option when learning how to invest in blockchain UK — since they are regulated by reputable financial bodies like the FCA.
Should I Invest in Blockchain UK?
We understand that you might be curious as to why investors are interested in blockchain assets. This curiosity is valid given the rate at which blockchain assets have become trending topics in the broader investment industry. Therefore, we have prepared this section to explain some of the key reasons behind the interest in blockchain in the UK.
Although investing in blockchain instruments has brought great returns in recent times, this asset class is highly volatile. As such, there are more factors to consider when assessing whether a digital asset is worthy of investment or otherwise.
Substantial Returns in Recent Years
You might be considering an investment in blockchain in the UK because of the growth you’ve seen across different projects in recent times. For instance, assets such as Bitcoin and Ethereum have recorded significant growth in the past few years. These blockchain assets are an indication that astronomical growth can happen to projects in the digital tokens space.
However, while these projects are already established and might appear too expensive for beginners, there are many newly launched options that you can consider. For instance, just two months after Safemoon launched, the project reached a market cap of $6 billion.
As such, one of the tasks as an investor will be to assess different blockchain assets to determine their potential in the marketplace. Nevertheless, it’s crucial to note that there’s no guarantee that the project you select will witness growth. On the contrary, there is every chance that you will lose money.
Many Projects to Choose From
There are more than 12,000 blockchain assets in which you can invest. This provides you with a wide range of options to choose from, making diversification easy.
For instance, you can decide to invest in Chainlink alongside some other projects such as Litecoin, Ethereum, Dogecoin, and more. This way, you can mitigate the risk of volatility that characterizes blockchain assets.
Easy Market Entry
One of the most important features of the blockchain assets space is that access is simple and burden-free.
- Anyone who has sufficient capital can get started with a blockchain asset investment.
- All that’s expected is to create an account with a credible broker and proceed to invest in the project you want.
To make this process seamless, you can choose a broker like eToro – which allows you to invest in blockchain assets from just $25. Additionally, the broker allows you to store your assets within its in-built wallet, making it super convenient to cash out your investment when the time’s right.
The Future of Money
There are numerous indicators that point to blockchain assets as the future of money. This space has gone mainstream and millions of people continue to develop an interest on a daily basis. Different governments are now implementing cryptocurrency-related policies and legislations to ensure seamless adoption and regulation of the industry.
Notably, there’s now a Bitcoin futures market in the US. Many businesses now also accept blockchain assets as means of payment. These are key indicators of the industry’s growing adoption across different sectors.
As such, any smart investor will also want to build a portfolio of blockchain assets. With the growth of the industry so far, there’s sufficient evidence attesting to the fact that there’s more to come.
What are the Risks of Invest in Blockchain Assets
Millions of investors have secured substantial gains from buying and selling blockchain assets.
- For instance, as of 25th October 2020, Ethereum was trading at about $417.
- However, as at the time of writing in later October 2021, the token now has a price of just over $4,090.
- Meaning, any investor who bought the asset at $417 would have witnessed gains of over 880%.
So, essentially, investors have made notable gains from this project and many others. However, this doesn’t mean that blockchain assets are risk-free. In fact, the industry is characterized by numerous risks that a smart investor must consider when looking to enter a particular market. Here are the crucial risks you should know about.
When many people decide to invest in a blockchain asset, they might not have a tangible reason for doing so. In most cases, they might be reacting based on the fear of missing out (FOMO). When investors make decisions based on this fear, they might be making the wrong choice.
As such, it’s crucial to have a significant reason for investing in a blockchain asset. You should consider the use cases of the protocol that launched the token. When a protocol has practical use cases and solves real problems, it tends to attract developers and users, which might impact the value of the asset in the marketplace.
High Level of Volatility
Blockchain assets are known to be highly volatile. An asset might carry a price today and a totally different one the following day — in fact, this sharp change can happen within seconds.
- For instance, Bitcoin hit a new all-time high of nearly $67,000 on 20th October 2021.
- However, the blockchain asset dropped to $60,000 just a couple of days later.
Therefore, investors must consider the long-term potential of a project over short-term returns. This will put you in a more informed position when contemplating the project in which you should invest.
How Much Does it Cost to Invest in Blockchain Assets?
If you want to invest in blockchain assets in the UK, you must consider the cost that you’ll incur during the process. Typically, the main things that will determine the cost of investment are the broker you choose and your preferred payment method.
We shall explain each of these fees to help you have a more in-depth understanding of what to look out for.
Deposits and Withdrawals
You can decide to make a deposit via your debit/credit card or an e-wallet depending on the broker you choose. If you’re using a broker like Coinbase to invest in blockchain assets through your debit/credit card, you’ll incur 3.99% in fees.
This is in stark contrast to a cost-effective broker likes eToro, where you’ll only be charged a fee of 0.5% when you invest in blockchain assets using any of the supported payment options – including debit/credit cards.
Commissions and Spreads
You’ll incur a commission if that’s part of a broker’s fee policy. Commissions are charged as fees for the brokerage services a platform offers to investors buying blockchain assets.
- Suppose you want to invest in blockchain assets through Coinbase – you’ll incur a standard trading commission of 1.49%.
- Meaning, you’ll pay £14.90 on a £1,000 investment.
- Similarly, if your investment has risen to £5,000 when you want to cash out, that means you’ll pay another £74.50 in commission.
- The total amount you’d have incurred here is £89.40.
On the other hand, if you elect to use a cost-effective broker like eToro, you’ll only incur a tight spread of 0.75% when you buy and sell.
- Meaning, you’d incur £7.50 on a £1,000 investment in a blockchain asset.
- While you’ll pay just £37.50 on £5,000
- In all, the total amount will be £45 as opposed to £89.40.
When you consider the gap between these two fee structures, you’ll realize that a broker like eToro offers you a low-cost service, making the platform a suitable option for you to invest in blockchain in the UK.
How to Invest in Blockchain UK – Conclusion
Our goal with this guide was to help you through the process of investing in blockchain in the UK. To that end, we have covered the steps involved, the best brokers to consider using, the risks you should know about, and the cost that comes with the process.
If you review each and every piece of information discussed in this guide when you want to invest in blockchain assets, you’ll be able to make informed decisions.
If you’re ready to invest in blockchain in the UK right now – consider eToro. This popular platform is easy to use, offers super-low fees, and most importantly – is regulated by the FCA.
How to invest in blockchain UK?
Where to invest in blockchain UK?
Should I buy blockchain assets?
How do you safely invest in blockchain assets?
How do you cash out blockchain assets?