The process of buying Ethereum. Ether is the native cryptocurrency of the Ethereum network and the second most popular crypto asset. There are many ways to buy ETH; we will go through the most popular ways and take you through them step-by-step.
How to buy Ether on an Exchange?
A crypto exchange is the easiest way for a beginner whos buying Ethereum. There are two available exchanges in the industry. A decentralized and centralized exchange. Most exchanges are centralized, although the number of decentralized exchanges is also growing. Read more about centralized and decentralized exchanges here.
Simply put, a centralized exchange is a more practical option for beginners buying Ethereum. Each exchange differs in the amount of personal information required during the setup process. The required information is known as know your customer and anti-money laundering requirements. Exchanges with high volume are the most recommended, such as Binance, Kraken, and Coinbase.
Account Set Up
Following the account setup, you will be required to fund your account. Some of the various ways to do so are either by bank transfer, credit card, or payment service. Of course, this varies according to the exchange and what they support.
Placing an Order
When placing an order of buying Ethereum, there are a few key things to consider:
You can specify the amount of Ethereum you want to purchase, either in terms of a specific number of coins or a certain dollar amount. Next, you can choose to buy Ethereum at the current market price or set a limit order to buy at a specific price. If you choose to set a limit order, you will need to specify the price at which you want to buy Ethereum.
You can place different types of orders, including market orders, limit orders, and stop-loss orders. A market order is executed immediately at the current market price, while a limit order is executed only when the price reaches a specified level. A stop-loss order is an order to sell Ethereum if the price falls below a certain level. Lastly, when placing an order of buying Ethereum, you may be subject to trading fees charged by the exchange. Be sure to review the fee structure of your chosen exchange to understand the costs involved.
Confirmation
After placing your order to buy Ethereum on an exchange, you will need to wait for confirmation that the exchange has filled your order. This confirmation means that your order has been executed, and the Ethereum you purchased has been credited to your exchange account.
The time it takes to receive this confirmation can vary depending on a few factors, including the market’s liquidity, the size of your order, and the trading volume on the exchange. In general, it can take only a few minutes to receive confirmation that your order has been filled, but it may take longer during high trading volume.
Wallet
The final step is to decide where your Ethereum will be stored. Whether in an online wallet or a personal desktop/ mobile wallet. Cold storage is the last option for storing Ethereum. Being that it is offline, it is less vulnerable to scams and known as a safer option than online wallets.
It’s important to remember that when storing your Ethereum in a wallet, you are responsible for the security of your private keys, and you should take precautions to protect your funds from theft or loss. If you keep your Ether in an exchange-provided wallet, exchanging it for other cryptocurrencies or fiat money might be quicker and simpler. Still, some people prefer to have complete control over their assets.
A decent rule of thumb is to put your ETH in an exchange-provided wallet if you want to trade regularly. An offline wallet should be used if you will only be using it for a short period.
Additional Ways to Buying Ethereum
An alternative method of buying Ethereum is directly from other individuals organized by an over-the-counter trading service. OTC desks are popular for institutions and high-net-worth individuals who want to conduct large trades that risk interfering with an exchange’s normal operations. Such as “slippage,” for example which means that tokens are not at their expected price.
One other popular way of buying Ethereum is through an ether ATM. You can find the closest ether ATM in your region and proceed by buying ETH by inserting fiat cash into the machine. The tokens are then automatically transferred into your crypto wallet. An ether ATM also allows you to sell ETH and receive cash from the machine in return.
Things to Consider
- Research the exchange: When selecting an exchange to buy Ethereum, it’s important to do your due diligence and research the exchange thoroughly. Look for an exchange that is reputable, has a good track record, and is secure. You can also check reviews and ratings from other users to get a sense of their experience with the exchange. In addition, make sure that the exchange supports the payment method you plan to use to add funds to your account.
- Consider the timing: Cryptocurrencies like Ethereum are highly volatile, and their prices fluctuate rapidly. It’s essential to consider the timing of your purchase and try to buy Ethereum when the price is low, rather than during times of high volatility. You can monitor the price of Ethereum using various tools, including price charts and market analysis websites.
- Understand the risks: Investing in Ethereum and other cryptocurrencies carries certain risks, including market volatility, regulatory uncertainty, and security threats. Before investing, be sure to understand these risks and only invest what you can afford to lose. It’s also important to keep up-to-date with news and developments in the cryptocurrency industry to stay informed about potential risks and opportunities.
- Secure your Ethereum: Once you have completed the process of buying Ethereum, it’s important to transfer it to a wallet that you control. This will help protect your funds from theft or loss. You can choose from various wallet options, including hardware wallets, software wallets, and paper wallets. Selecting a reputable wallet provider and following best practices for securing your private keys, such as using two-factor authentication and storing your keys offline, is important.
Questions
- Is it safe to buy Ethereum online?
Buying Ethereum online can be safe if you take necessary precautions. You should research the exchange or platform, enable two-factor authentication, consider using a hardware wallet, and be aware of the risks that come with cryptocurrency investing.
- Can you buy Ethereum anonymously?
It depends on the platform or exchange you use to purchase Ethereum. Some platforms require users to verify their identity before buying Ethereum, while others may allow anonymous transactions up to a certain limit. However, it’s important to note that anonymous purchases can come with additional risks, such as the potential for fraud, scams, or security breaches. It’s always recommended to use reputable exchanges and platforms and to follow best practices for securing your cryptocurrency investments.
- What is the minimum amount of Ethereum you can buy?
The minimum amount of Ethereum you can buy depends on the exchange or platform you use. Some exchanges allow users to purchase Ethereum with as little as $1, while others may have higher minimum purchase requirements.
- How do you know if you’re getting a good price when buying Ethereum?
To know if you’re getting a good price when buying Ethereum, you should compare the current market price of Ethereum with the price you are being offered on the exchange or platform. This can help you determine if the price is fair and reasonable. You can also check the historical price data of Ethereum to get a sense of the price trends and fluctuations.
- How long does it take to buy Ethereum and have it show up in your account?
This depends on various factors, such as the payment method you use, the exchange or platform you use, and the amount of traffic on the network. Generally, buying Ethereum using a credit or debit card is one of the quickest methods and can result in the Ethereum showing up in your account within a few minutes. However, buying Ethereum using a bank transfer can take several days to complete.
Closing Thoughts
By considering these factors and taking steps to reduce the risks associated with buying Ethereum, you can invest in cryptocurrency with greater confidence and potentially earn a profit over the long term. Buying Ethereum can be a relatively straightforward process, but it’s important to consider several factors to ensure that you invest safely and with confidence. By researching the exchange, monitoring the market, understanding the risks, and securing your Ethereum in a wallet, you can minimize the risks associated with buying cryptocurrency and potentially earn a profit over time.
However, it’s important to remember that investing and buying Ethereum and other cryptocurrencies carries inherent risks, and you should only invest what you can afford to lose. By staying informed and following best practices, you can navigate the complex world of cryptocurrency investing and potentially reap the benefits of this emerging asset class.
