How to Buy Ethereum
Ethereum aims at becoming a unique blockchain solution for all, a global computer that will one-day transform most of the services currently in existence. The Ethereum network allows anyone to develop decentralized apps and generally make use of the network, as long as they own Ethereum’s native cryptocurrency, called Ether.
On how to buy ethereum cryptocurrency, there are many ways to purchase ethereum, all of which will be covered in this handy guide.
Exchanges to buy Ethereum
New entrants in the cryptocurrency market often ask questions like How can I buy ethereum? Where can I buy ethereum? What is the best way to buy ethereum? A cryptocurrency exchange is an ideal place to obtain your Ether, due to the exceptional ease of use. Finding an online exchange that operates within your area and trades in Ether won’t be that hard since Ether closely follows Bitcoin as the second most valued, stable and well-known cryptocurrency.
The first step is to register on an exchange. Before registering on any exchange, make sure it operates in your jurisdiction and accepts the currency you want to trade in. You will be demanded to submit a few general details during the registration process.
Usually, there are full identity checks where you will be required to provide a proof of address as well as a photo identification. Once you complete all the necessary identity verifications, you will need to choose a deposit method. Depending on a particular exchange platform, there are several ways of doing so. They include credit and debit card payments, SEPA or PayPal payments, and bank wire transfers.
Most exchanges accept Euros and US Dollars, with other major fiat currencies like British Pound, Russian Ruble, Chinese Yuan, Japanese Yen and so on being allowed on some of the exchange platforms as well. Depending on a particular exchange and the chosen deposit method, it typically takes many hours for your deposited funds to appear in your trading account.
You can start trading as soon as the funds are in your trading account. The user-friendliness of the trading process depends on a particular exchange, with many of the exchanges trying to make the process as comfortable as possible. You will be able to get all the relevant information, like market capitalization, current value, and related news on your exchange’s website.
Buy Ethereum with cash
This is probably the best way to buy ethereum, primarily because it allows you to buy Ether anonymously, while concurrently avoiding the trouble of going through Anti-Money Laundering and Know Your Customer-related checks. Even though regulators don’t allow this in some jurisdictions, buying Ether from an online peer-to-peer exchange like LocalEthereum is possible.
Just like LocalBitcoins, LocalEthereum expedites OTC (over-the-counter) trading of fiat currencies for Ether. The primary distinction is that LocalEthereum is an entirely decentralized service, with escrow services and arbitrage being done via the use of Ethereum smart contracts.
The service is a marketplace, where users can offer any fiat currency in exchange for a specific amount of Ether. Exchange of funds takes place automatically after a seller accepts the offer. Funds can be transferred using credit and debit cards, PayPal payments, bank wire transfer, as well as other cryptocurrencies. The service is not free of charge. Sellers are typically charged a 0.25% fee, while buyers need to pay 0.75%, which is still relatively lower than what is charged on most centralized exchanges. The transaction processing can take few hours.
LocalEthereum also allows the parties to communicate via messages, so it is possible to arrange for an eye-to-eye meeting with a seller and exchange cash for Ether. Ensure that you set up your meeting in a public place and take every precaution needed when handling a financial deal with a stranger. You will also need to have access to the internet to sign off on the transaction.
If you’re bothered about arranging a one-on-one meeting off the internet with a total stranger, there is always an option of finding a meet-up for local Ethereum. There you can trade your Ether safely while learning from and exchange ideas with like-minded crypto enthusiasts at the same time. Meetup.com has a dedicated page where you can find Ethereum meet-ups.
Peer-to-peer trading is by far the most private and secure method available for Ether. Besides, it offers exceptional flexibility when it comes to trading pairs, and it has no limits on buying and selling. However, this method of trading demands a certain level of trust between the two individuals, particularly when meeting in person. Moreover, if you’ll choose to engage in OTC trades, it is your responsibility to guarantee you’re complying with your local regulations.
Ethereum ATM is an alternative way of buying Ether. It is an ideal way to obtain Ether for investors and traders looking to purchase small amounts. There is no need to comply with Anti-Money Laundering regulations and Know Your Customer, as most cryptocurrency ATMs limit transactions to small amounts; which means you don’t need to verify your identity.
You will need to get a wallet before being able to use a cryptocurrency ATM. Later on in this guide, we will cover different kinds of Ethereum wallets and ways of setting them.
After getting a wallet, you will need to find your nearest ATM that expedites Ether transactions. CoinATMRadar is a handy service which provides a comprehensive list and a map of cryptocurrency ATMs.
After locating the ATM closest to you, find a QR-code in your wallet and scan it by holding it up to the machine’s camera. Then, put your cash into the ATM and confirm the amount of Ether to complete your transaction. The Ether you bought will be sent to the wallet address you gave. The transaction takes typically about 30 minutes, but it might take many hours in some situations.
Before purchasing Ether, it is crucial to gain a good knowledge of wallet software and how transactions work on the Ethereum Network. There are different types of wallets; you can use as a wallet provided by a cryptocurrency exchange as well as a hardware wallet. You can download official Ethereum wallets on Ethereum.org.
Another thing to contemplate is whether you want to use a ‘full node’ wallet, which will require you to download the whole Ethereum Blockchain or a ‘light client,’ which doesn’t need a full Blockchain to function. Of course, a light client would be a preferred option if you’re new to Ethereum. MyEtherWallet offers light client wallets, Jaxx.io is another alternative, and it also holds other digital currencies.
If you’re obtaining your Ether on an exchange platform, using a wallet provided by the platform is the most comfortable option, but it’s presumably the least secure place to store your assets. Unfortunately, the cryptocurrency ecosystem is filled with cases of exchanges suffering hacker attacks. An exchange platform is very unlikely to refund its clients if a hack happens and someone steals funds from the exchange, including the users’ wallets.
Thus, using a desktop or mobile wallet is a more reliable option, as it gives users full control over their assets. There are still some discreet security standards of which you need to be aware. Most importantly, you should keep private key (your wallet’s password) a secret. Moreover, there will be no way of accessing your wallet ever again if you lose or forget it, and all the funds you are holding on the wallet will be permanently lost. Finally, it is also advisable you set up a two-factor authentication to access your wallet.
If you wish to store large amounts of Ether, it is advisable you take an extra security step by buying a hardware wallet. Such devices store your private key offline and do not need to connect to the Internet. This substantially decreases the risk of digital theft, which is the most common attack on digital assets holders. Upon the creation of a wallet, the device provides a recovery password, and the device itself can be accessed using a PIN code. Besides your wallet’s password, your Ethereum wallet will create many receiving addresses, which are referred to as ‘public keys.’ Those receiving addresses can be shared reliably without risk of theft. People who want to send some Ether to you will do so using one of those addresses.
Ethereum transactions take about 20 seconds to be executed. After it happened, it means that the transaction was considered genuine and was registered on the Blockchain, where everybody can view it. It is essential to note, however, that the only information about the transaction filed there is the amount of Ether sent and the receiver’s address.
Difference between Ethereum and Ethereum Classic
Ethereum and Ethereum classic are mainly two separate platforms, break from one original Ethereum following the implementation of a ‘hard fork’ approach as a response to about $150 million worth of Ether a hacker stole. The two platform exist on separate Blockchains, which are entirely identical all the way before the hard fork. With new rules that set in place to avoid such hacker attacks in the future, Ethereum became a new platform. While about 10 percent of users, developers, and decentralized applications have stayed with Ethereum Classic, most of them have migrated to Ethereum.
The split is primarily ideological and ethical. Those who lingered with Ethereum Classic were believers in the immutability of the Blockchain, and the staunch supporters of the ‘code is god’ principle. However, the division can be seen as a milestone for the Ethereum community, as it persevered and came together to handle the worst hack in the history of cryptocurrency.
The biggest problem with Ethereum Classic is probably that Ethereum hard fork isn’t backward compatible with it. This implies that all of the improvements and update implemented in Ethereum are not compatible with and are not available for the Ethereum Classic network.
The single most important consequence of a hard fork for Ethereum is the fact that it took place. Many people are speculating that it opens up chances for future hard forks, and some believe that leaders of the Ethereum community might plan a hard for their benefit. The new Ethereum platform is also reprimanded for letting the community make a critical change in the network while going against its mathematical objectivity, something for which it was always praised.
Regarding value, Ethereum Classic was valued at $34.07, while Ethereum was worth $735.83, at the time of writing. For a while now, both tokens have been recording steady increases. Moreover, their price appears to correlate. Both cryptocurrencies are undoubtedly worth the attention of investors.
Is it too late to invest in Ethereum?
The Ethereum project is still very much in the developmental stage. If it will accomplish what its developers set out to achieve – becoming a global computer, while facilitating micropayments between machines as well as entirely borderless and trustless transactions between people – then it very apparent that investing in Ethereum is not too late.
As said earlier, Ether has currently established itself as a stable, strong and second most trusted cryptocurrency. The value of Ether is only going to keep increasing, as the platform develops. Some people think that the price might stabilize and stop growing when the platform achieves its goals in the foreseeable future. But, just like any cryptocurrency, it’s tough to predict its long-term value. Ether can be worth nothing in 10 years’ time, or it can be valued at a practically uncapped sum that can only be imagined.
How to Transact Ethereum Safely?
One of the most critical aspects of the Ethereum network is that there is no chargeback — there is no way of getting your funds back after sending them or modifying a transaction. So, make sure you never type the address by hand, as it is mostly a very long and case-sensitive series of random numbers and letters. One single blunder can lead to your assets vanishing forever. So, before confirming a transaction, ensure to double-check all the details
Avoid storing substantial amounts of Ether in wallets offered on exchange platforms. As an exchange is mainly in control of your wallet, you are not entirely safe from loss of coins, which may happen due to an exchange’s fraudulent activity or a hacker attack. Desktop, mobile and online wallets are safer than exchange wallets. If you’re planning on storing substantial amounts of Ether, consider buying a hardware wallet. Where possible, set in place extra safety steps like multi-signature wallets, two-factor authentication, and so on. Finally, always bear in mind that the only way for you to access your Ether is through your private key. Take extra precaution not to lose it or let it fall into the hands of a third party.