At this point in the evolution of cryptocurrency, it’s very easy to buy XRP. How to do it depends on your circumstances and preferences.
Exchanges are the gateway for many cryptocurrency users and there are many to choose from. Not all exchanges are open to users in all countries, so you may need to try a few options before you find one that’s right for you.
Another consideration when choosing an exchange is security. Exchange hacks are a frequent occurrence, and even big exchanges have been shown to be vulnerable. A report by crypto intelligence firm CipherTrace reported that over $4 billion had been stolen from crypto users in the first half of 2019 alone. Although not all of these thefts were hacks, the number is significant and demonstrates the risks.
If you want to buy Ripple from an exchange, then Coinbase is generally a safe bet. It’s very easy to use for newcomers, and you can buy XRP tokens by making a deposit with your credit card or via bank transfer. Coinbase is fully insured, meaning that even if the exchange gets hacked, your funds are covered.
Using a custodian service means that you’re using a provider who safeguards your cryptocurrency on your behalf. Many cryptocurrency users choose to use a wallet, either an online (hot) storage service or an offline (cold) storage service. However, if you choose to use a wallet, then you need to make sure you can keep your private keys safe.
While this may seem like a trivial matter, there are plenty of horror stories from the crypto-sphere where users have accidentally lost their private keys — and their cryptocurrency — forever. For example, one British IT worker accidentally threw away a hard drive containing his private keys, losing him access to 7,500 BTC he had mined in the early days of Bitcoin. Even at 2019 trading lows of ~$3500, those coins would be worth well over $26 million. Ouch.
Using a custodial service avoids all this worry, so if you decide to take this route, then Skrill is a solid choice. The UK-based online payment company is a competitor to PayPal, although it’s now expanded its service range beyond pure fiat payments.
Skrill opened its cryptocurrency service in 2018, aiming to make it easier for its users to access digital currencies. You just need to open an account, and from there, you can buy Ripple, or eight other coins using a credit card or bank transfer.
You can fund your Skrill account with a range of different currencies, and unlike a cryptocurrency exchange, it has other fiat payment services integrated too. The company has been in operation since 2001, so it has nearly two decades of experience in the money business, and has accrued millions of users in that time.
A final option for purchasing XRP is to buy through a broker. Also known as an over-the-counter (OTC) trade, brokerages operate as part of a network of dealers. Brokerage networks have access to a range of traders willing to buy or sell. This works particularly well for larger orders, as an exchange may not be able to find a counterparty willing to match a big trade.
Another feature of a broker is that, unless they also offer custody services, you’ll have to use your own wallet. This means keeping your private keys safe.
CEX.io is an example of a broker service. Like Skrill’s custodial service, it’s a great option for beginners as you can simply place your order, and the platform will freeze the price for you. However, the trade-off is that the fees can be rather high, and that the price CEX calculates for cryptocurrencies is usually a bit higher than the actual market price.
The volatility of the cryptocurrency markets means that anyone investing always has to accept a certain degree of risk. However, users can offset some of this risk by choosing the most secure options for their crypto holdings.