Cryptocurrency is becoming more and more popular, and New Zealanders are no exception. Cryptocurrencies in New Zealand are considered to be assets or legal property. Bitcoin is New Zealand’s most popular cryptocurrency, with 50.8 per cent of crypto owners owning the coin.
This article will explore what to know when you buy Ethereum NZ with Swyftx or any other exchange platform. It will cover everything from the types of exchanges available to the different payment methods that can be used.
What is a Cryptocurrency Exchange?
A cryptocurrency exchange is an online platform that allows users to trade cryptocurrencies for other assets, such as fiat money or another digital currency. Through a crypto exchange, one can buy or sell cryptocurrencies or exchange one cryptocurrency for another.
How Does the Platform Work?
Cryptocurrency exchanges work by matching buyers with sellers. You can trade in various crypto currencies like buy Ethereum in NZ with Swyftx or similar crypto exchanges. When buyers want to buy cryptocurrency, they will need to open an account with the exchange and deposit money into their account to purchase it. It can be done by transferring fiat currency from a bank account, credit card, or wire transfer.
Once the money is in their account, they can use it to buy cryptocurrency on the exchange by placing an order at a specific price. The order will be matched with a seller willing to sell at that price, and the buyer will receive their cryptocurrency. If the buyer wants to sell cryptocurrency in their account, they can do so through a similar process.
The platform will take a fee for each transaction made on it. The fees will vary depending on the exchange, but most exchanges charge a percentage of the total amount being exchanged.
Types of Exchanges Available in New Zealand
Crypto trading in New Zealand is becoming more popular, and there are many different exchanges available to trade on. The country’s Inland Revenue (IRD) has allowed crypto assets to be treated as a form of property. There is a tax applicable on the buying and selling of cryptocurrencies.
There are three main ways to trade with cryptos. Each has its advantages, so it is essential to know what one offers before choosing which exchange to use.
1) Peer-to-peer Exchanges
Peer-to-peer exchanges allow users to buy and sell cryptocurrencies directly from one another. They do not hold any user funds and do not charge any fees. They allow users to buy cryptocurrencies using different payment methods, such as cash or bank transfers.
The benefits of peer-to-peer exchanges include buying cryptocurrencies using different payment methods and the lack of fees. However, they can be risky as there is no guarantee that the seller will send the cryptocurrency after receiving payment.
It is essential to verify the seller’s identity before buying cryptocurrency. It can be done by checking their previous transactions on the exchange and asking for ID proof. It can also be done by checking their social media accounts and asking for a photo of themselves holding an ID next to the screen displaying your chat.
2) Centralised Exchanges
Centralised exchanges are the most popular type of exchange and are run by a company. They allow users to buy and sell cryptocurrencies using different payment methods, such as credit cards or bank transfers.
The benefits of centralised exchanges include their user-friendly interfaces, the availability of customer support, and the ability to use different payment methods. However, they are also the riskiest as hackers often target them.
It is essential to find a reputable exchange that has good security practices and uses two-factor authentication. Two-factor authentication is a process that requires two different forms of identification, such as a password and a code sent to your phone.
Centralised exchanges also often have restrictions on the amount of cryptocurrency that can be bought or sold at one time. It is essential to find an exchange that allows you to buy or sell the cryptocurrency you want without any restrictions.
Tips to Choose The Right Exchange
Many different factors contribute towards making an exchange the right one for you.
1) Type of Currencies
The main factor to consider is the type of cryptocurrencies supported on the exchange. If you want to buy a specific cryptocurrency, it must be supported by the exchange. Some popular cryptos include Bitcoin, Litecoin, and Ethereum.
While not all exchanges support the same cryptocurrencies, most offer a wide range of digital assets.
2) Fees
The fees charged by an exchange on each transaction are essential to consider. The fees will vary depending on the type of exchange and the payment method used.
It is essential to find an exchange that has low fees, as this will save you money in the long run.
Conclusion
Cryptocurrency is becoming more popular in New Zealand, and there are many different exchanges available to users. It is essential to consider the type of exchange, the currencies supported, and the fees charged before choosing an exchange.
