How do I use Cardano?
How do I buy ADA?
ADA is the native cryptocurrency of the Cardano blockchain. Its what you need if you want to buy things on Cardano or invest in the Cardano blockchain.
All ADA in existance is owned by people. If you want to buy some for yourself, you need to buy it from someone who wants to sell theirs. The best way to do this this on a cryptocurrency exchange. There are lots of cryptocurrency exchanges out there, we’d recommend opting for a well-respected large exchange. Here are 3 popular choices you may want to consider:
Very popular simple to use exchange. You may not find the best deal here in terms of return for your money, but they make it very easy.
The largest exchange. Offer an increadible variety of trading functions and services, including just standard buying some cryptocurrency. Usually has one of the highest trading volumes by its customers, so good availability of cryptocurrencies.
An alternative choice to Binance. Lower volume of trading typically but still often very good.
You may be fearful of using a cryptocurrency exchange, the press have done a good job of telling everyone not to go anywhere near the space and your bank may try to warn you against it too. Whilst you do need to take care and avoid being scammed, the truth is that cryptocurrency is a massive business with hundreds of Billions of dollars worth of people’s money invested. Cryptocurrency exchanges provide a service and make money from providing it, its in the interests of the good ones to ensure their customers are happy and well served.
When you buy ADA on an exchange, the current price of it is the price someone out there has told that exchange they are willing to sell theirs for. Once it’s purchased, the price changes to whatever the next customer is willing to sell theirs for. The exchanges handle all of the complexity of this for you. On many, they will simply offer you a fixed price and make it all very simple and convenient. If you delve deeper into most you’ll discover that you can “trade” on their “Exchange”, just as you would do with stocks and shares, setting up a buy order to execute when the price someone will sell for reaches whatever you are willing to pay. It can be fun to learn them, but it can also get pretty complex with the array of trading tools some offer. Up to you how involved you want to get.
The basics are:
- If you “trade” rather than “buy” you will likely get a better price – the convenience they offer you of just buying at a fixed price is at the expense of getting the best price possible (the exchange makes a bit more profit by offering the simple to use service). If you’re buying a small amount then you may not care. If you’re investing a larger sum then it may be worth learning about so you get the best deal.
- If you transfer your fiat money ($, €, £, etc) into the exchange by bank transfer you will likely get charged lower fees than if you use a debit or credit card.
Always, there are no official trading hours like on stock exchanges.
When you use the "trade" service of an exchange, you select the coin pair you wish to trade between. So if you are, say, wanting to purchase ADA using your Euro's, then you'd select the EUR/ADA pair. Exchanges offer trading pairs based on demand and also offer trading pairs between cryto curencies themselves (e.g. Bitcoin and ADA: BTC/ADA). Cardano is very popular these days so has a lot of currencies offered as a pair with it.
To comply with "know your customer" regualtions that most governements require from financial services companies to protect against money laundering etc.
What do I do with ADA I've purchased?
So you’ve bought some ADA, nice!
If you’re just investing then you have two choices:
- Leave it on the exchange. Let them keep it safe for you.
Advantages: Simple, all done for you.
Risks: If the exchange gets hacked or goes out of business for some reason you may lose your ADA.
- Withdraw your newly purchased ADA to your own wallet on the blockchain.
Advantages: Your ADA. You can also spend them on things if you wish. You can also stake them and earn staking rewards from the Cardano blockchain (tyically 4-5% a year).
Risks: You are responsible for your recovery passphrase/private key. This the master password that will lose you all of your ADA if you ever loose it or if someone bad ever gets it.
Withdrawing my ADA to a wallet
If you want to ensure your ADA stays safe you must purchase a hardware wallet (sometimes called a cold storage wallet). This is a device that ensures your secret recovery passphrase/private key is never provided to your wallet software, your computer or the internet. Because it keeps it inside itself, it keeps it safe from hacking, wallet security bugs, etc.
Don’t worry, you also write down the recovery passphrase on a bit of paper and store it somewhere safe in case you ever lose the hardware wallet and need to replace it. Although people talk about storing their coins/ADA in their hardware wallet, in fact the coins are always stored on the blockchain itself. A hardware wallet just keeps safe your secret passphrase that allows the blockchain wallet to be used.
You don’t have to use a hardware wallet to create a wallet a blockchain, but let us put it this simply: If you don’t use a hardware wallet then you should work on the assumption your ADA and any NFTs you store in your wallet will one day get stolen.
They cost less than $100. Buy directly from the manufacturer so you can be sure the recovery key hasn’t been seen by anyone else (never buy from a reseller site!)
The Ledger Nano wallet is one the most popular hardware wallets. The cheapest Nano S is fine if you can connect to your wallet using USB, e.g. you will use your desktop computer for your wallet. The more expensive Nano X has Bluetooth so can be more convenient when used with a mobile phone or tablet.
The Trezor Model T supports Cardano ADA.
Ledger provides their own software that can be used to create a Cardano wallet and then receive the ADA from the exchange you have used. They actually let you buy ADA directly through their wallet software too, although you may well not get the best deal if you do that.
There are also lots of other wallets available that also work great with the Ledger (you don’t have to use Ledger’s own wallet software). Any wallet software you use with your Ledger is accessing the same wallet on the blockchain, your wallet. When you use your Ledger with wallet software it gives it access to your one single wallet, so by all means try out more than one and see how you get on if you want to experiment.
How would I get an NFT on Cardano?
You need a wallet on the Cardano Blockchain. Take a look at the “Withdrawing my ADA to a wallet” section above to learn how to do this.
Once created, your wallet will have a unique “receive” address and you can give this to someone else who has the NFT you want and they can then send it to the address of your wallet.
If you want to buy an NFT, you’ll need to purchase some ADA (see earlier in this page) and store it in your wallet. Now you’re all set to visit a NFT seller’s website and purchase an NFT.
If you want to create your own NFT you can use the blockchain itself if you’re clever enough, or one of the many companies offering NFT creation as a service on the blockchain.
The NFT exists on the blockchain for all to see and its ownership is assigned to your wallet. Wallet software lets you interact with the blockchain and your wallet.