Complete Guide to Buying Cryptocurrency in Taiwan | A Must-Read for Beginners on Bitcoin Trading Process and Selection Strategies

Thinking about purchasing cryptocurrencies but don’t know where to start? As more people pay attention to digital assets, the variety of trading platforms on the market can be overwhelming, and novice investors in Taiwan often face choice dilemmas. This article will guide you through the ways to buy virtual currencies, the characteristics of different platforms, and how to find the most suitable trading channels based on your needs.

The Five Core Steps to Buying Virtual Currencies

All trading platforms operate on similar basic logic, but specific procedures and costs vary. Mastering the following process will make it easy for you to get started with cryptocurrency investing:

Step 1: Determine your investment direction and choose a platform
Before purchasing cryptocurrencies, clarify whether you intend to hold spot assets long-term or engage in short-term trading. Different investment goals correspond to different types of exchanges.

Step 2: Complete account registration and real-name verification
Most legitimate platforms require KYC (Know Your Customer) verification. This is a basic compliance requirement, usually involving uploading ID documents and proof of residence.

Step 3: Deposit funds into your trading account
Taiwan users can deposit via bank transfer, ATM transfer, or credit card. Some platforms support direct fiat-to-crypto purchases, simplifying the buying process.

Step 4: Execute trades or place limit orders
After depositing, you can choose to buy immediately with a market order or set limit orders to wait for your target price. Some platforms also offer leverage trading for advanced investors.

Step 5: Withdraw or transfer assets
Once the trade is completed, you can transfer assets to a self-custody wallet for long-term holding or withdraw back to your bank account.

The Three Main Ways to Purchase Virtual Currencies

Centralized Exchanges - Best for Beginners

Centralized exchanges are the mainstream in the market, managed by professional institutions that custody assets. They offer simple trading processes, a wide range of trading pairs, and high liquidity. Users do not need to understand blockchain technology in depth to start trading.

Advantages: High trading depth, fast order execution, user-friendly interface, numerous trading pairs
Disadvantages: Platform risk, limited privacy protection, requires identity verification

Common trading method: Transfer fiat currency into the account, purchase stablecoins like USDT, then exchange for Bitcoin or other cryptocurrencies.

Decentralized Exchanges - Emphasizing Security and Privacy

Decentralized exchanges execute trades via smart contracts, allowing peer-to-peer transactions, with users self-custody of assets. This mode greatly enhances fund security but is more complex to operate.

Advantages: Fully transparent trading, no identity verification needed, strong censorship resistance, true control over assets
Disadvantages: Complex interface, relatively lower liquidity, slower transaction speeds, prone to slippage

Suitable for: Investors with high privacy requirements, holding large amounts of funds, and with some technical knowledge.

Derivatives Trading Platforms - Suitable for Professional Traders

Derivatives platforms offer products like futures, options, and contracts for difference (CFDs). Investors can leverage to perform two-way trading without holding actual assets, participating in market volatility.

Advantages: High leverage (usually 1-100x), low entry barriers, two-way trading mechanisms, abundant trading opportunities
Disadvantages: High leverage risk, potential for liquidation, contract settlement risks, not suitable for beginners

Risk warning: Derivatives trading is suitable for experienced traders. It is recommended to practice with demo accounts first, learn to set stop-loss and take-profit, then trade with real funds.

Taiwan vs. International Platforms: Cost and Experience Comparison

Choosing Local Platforms in Taiwan

The biggest advantage for Taiwanese users choosing local platforms is support for NT$ deposits, eliminating the need to exchange currencies first. Common local platforms support fiat deposits and withdrawals with fees around 0.05%-0.15%. While their coin selection is limited, they are sufficient for buying mainstream coins like Bitcoin.

Suggestion: If you just want to buy Bitcoin or other major coins for long-term holding, local platforms are enough. The convenience of NT$ deposits outweighs the limited coin variety.

Advantages of International Platforms

International large exchanges offer a wide range of trading pairs, strong liquidity, and generally lower fees. Many hold multiple regulatory licenses from different countries, providing better security.

Suggestion: If you want to explore more coins, trade frequently, or participate in derivatives, international platforms offer more options and opportunities.

Spot Trading vs. Derivatives Trading: Which to Choose?

Spot Trading - Stable Long-term Investment

Spot trading involves actually buying and holding cryptocurrencies. Suitable for investors optimistic about Bitcoin’s long-term value. After purchase, assets can be stored in a self-custody wallet or exchange account, with no risk of liquidation.

Suitable investors: Those confident in the future of cryptocurrencies, willing to hold long-term, with low risk tolerance
Initial capital needed: Higher, as full purchase is required
Profit method: Wait for price appreciation to sell for profit; or hold long-term to enjoy asset appreciation

Derivatives Trading - High Risk, High Return

Derivatives allow participation in price movements without owning the actual assets. Using leverage and two-way trading, investors can quickly enter and exit the market to capture short-term gains.

Suitable investors: Experienced traders willing to take high risks, seeking quick profits
Initial capital needed: Lower, only margin is required to control larger positions
Profit method: Long or short positions to profit from price differences; intraday trading to capture volatility

Example Comparison

Suppose Bitcoin is priced at $30,000:

Spot buyer: Invests $30,000 to buy 1 BTC. If the price rises to $33,000, profit is 10% ($3,000). If it drops to $27,000, loss is 10%.

Derivatives trader (10x leverage): Invests $3,000 margin to control a contract equivalent to 1 BTC. The same 10% price movement results in 100% profit or loss. If the price drops more than 10%, the position is liquidated.

Three Major Strategies for Cryptocurrency Investment

Long-term Investment - Believing in Bitcoin’s Future

Analyze Bitcoin’s technical features, global trends, and market cycles. Buy when the price is relatively low and hold long-term. Suitable for investors who believe in the future development of cryptocurrencies.

Practical advice: Purchase Bitcoin on spot exchanges, transfer to a self-custody wallet, and set a long-term investment horizon of 5+ years.

Medium and Short-term Trading - Capturing Market Cycles

Based on technical and fundamental analysis, forecast price trends over the next month to half a year. Set clear take-profit and stop-loss points, and exit immediately when targets are reached to realize gains or cut losses.

Practical advice: Use centralized exchanges’ spot or light leverage features, with risk limits of 2-5% per trade.

Ultra-short-term Trading - Capturing Intraday Fluctuations

Monitor minute-level price movements for multiple trades within a day. Requires deep technical understanding and keen market sentiment judgment.

Practical advice: Use futures contracts on derivatives platforms, leverage to amplify returns, but strictly execute stop-loss orders, limiting losses to 1-2% of the account per trade.

Risk Tips Every Beginner Should Know

The true cost of leverage trading
Leverage amplifies both profits and losses. A 10x leverage means a 10% adverse move can wipe out your entire account. Many beginners have lost their principal within weeks due to misunderstanding leverage risks.

Platform security and asset custody
Choosing platforms with proper regulation and long operating histories is crucial. Although the risk of hacking or platform failure is relatively small, it’s not zero. For large funds, it’s recommended to store assets in self-custody wallets.

Market volatility and psychological challenges
Bitcoin can fluctuate over 50% within a year. In extreme conditions, many investors make irrational decisions. Staying calm and strictly following your trading plan is vital.

Checklist Before Starting to Buy Cryptocurrency

Before placing an order, confirm the following:

✓ Clarify your investment goals (long-term hold vs. short-term trading)
✓ Assess your risk tolerance (how much loss can you bear?)
✓ Choose a safe, legitimate trading platform
✓ Practice with demo trading to familiarize yourself with the platform interface
✓ Set stop-loss points for each trade
✓ Avoid or cautiously use leverage
✓ Regularly review your investment plan and market trends

Summary of Key Points

• The five steps to buying cryptocurrencies: choose platform → register → deposit → trade → withdraw
• The three main methods each have pros and cons: centralized exchanges are most convenient, decentralized exchanges are safest, derivatives platforms offer the most opportunities
• Local Taiwanese platforms support NTD deposits but have limited coin options; international platforms offer more choices but are more complex to operate
• Spot trading suits long-term investors; derivatives trading is for professional traders
• Leverage trading carries high risks; beginners should start with spot and demo trading
• Regardless of the method chosen, setting stop-loss and controlling risks are always the top priorities

Are you ready to start your cryptocurrency investment journey? Begin by choosing a suitable platform and trading method, then gradually build your understanding of the market and trading discipline. Remember, consistent learning and risk management lead to steady gains, not overnight riches.