Say “cryptocurrency” and Bitcoin (BTC) is probably the first coin that comes to your mind. But some investors believe that Ethereum and especially Ethereum Classic holds even a greater promise.
Originally produced to eliminate some of the constraints the Bitcoin had, Ethereum has grown into a whole new concept of digital currencies. Even though the transaction speed on it is slower than on some of the new blockchains, the versatility of smart contracts makes up for any drawbacks. These tiny bits of code greatly reduce the risk of fraud or unfair trade between parties. As a crowdfunding vehicle Ethereum has won hearts of thousands of startups who now can bypass traditional crowdfunding platforms who charge hefty fees for their services and appeal to their supporters directly.
Without further travel into technical details that make Ethereum and its token Ether so wonderful — and steadily growing, which is important for the investor — let’s discuss the ways that you can amass a small fortune of these promising coins.
How to Buy Ethereum on Exchange
One of the most common ways to acquire Ethers is through an exchange. Websites like CoinBase or Gemini, allow you to purchase Ethereum through their platform at the exchange rate. They don’t sell tokens themselves at a particular exchange, but how it works is the exchanges pair you as a buyer with a seller who’s selling for whatever price you’re looking for. This sounds like a great option, and in some ways it is, but it has its disadvantages as well.
One of the major drawbacks, for example, is that the exchanges require you to add your personal information to them via Know Your Client or Know Your Customer (KYC) legislation that’s present in many countries in regard to currency-related businesses. This might not be a concern for everyone, but in today’s climate when everyone is focused on their personal data privacy it’s becoming clear that data you put out there is more accessible than you think.
If you are not concerned about data privacy and are ready to provide details required for the exchange to set up your account, here’s a step by step guide how to buy Ether tokens on an exchange.
Step 1. Choose the exchange that is legal in your jurisdiction.
This is important because certain countries do not allow trading cryptocurrencies or limit access to exchanges. Make sure you can move your local fiat currency in and out of your account without restrictions.
Step 2. Create an account
This is an easy step but you have to be prepared to wait for several days once your bank account is getting verified and linked to your exchange account to deposit fiat currency. Some banks are wary of cryptocurrencies and may not allow transactions to go through when you open a payment account. You should also link your digital wallet that you plan to use for storing your Ether tokens. Some people prefer multi-currency wallets while others open new wallets for each new currency they are planning to buy and invest into. A hardware wallet is the most secure way to hold your coins.
Step 3. Purchase Ether tokens.
Indicate the amount of Ether (or portions of token) you plan to buy, complete the transaction and you are now a proud owner of a shiny new stash of Ether tokens.
For some people the idea that they have to give up their personal information to an entity which might have to release that information seems to go against the spirit of cryptocurrency movement. Fortunately, there are other options.
How to Buy Ethereum from a Private Broker
If you’re able to find a private broker, you can connect with them and exchange. This has some obvious benefits, but it also has drawbacks.
First off, it’s completely anonymous. Even if you meet in person, there’s no reason you need to use your real name, or any details about yourself other than your wallet number so they can transfer the funds to you. And if you pay cash, the banks can’t trace it either. So if it is possible for you, you’re in business.
But of course with anonymity comes some risk as well. Dealing through an exchange, the risk of getting ripped off is lower. Some exchanges evaporated in thin air in the past, taking all coins with them, but the bigger, more established exchanges have had time to build their brand and prove themselves as more trustworthy.
You may pay a price premium for that anonymity as well. The broker’s fee can be as much as 15-20% higher than average exchange prices. But again, if anonymity is important to you, that’s a small price to pay.
When you trade with someone anonymously, you don’t have the security of the exchanges. They could be legit and honest, but they could just as easily be shady and willing to rip you off. For many people buying from a private broker they trust is a preferred method of purchasing Ethereum. But it’s important to have safety measures in place, otherwise you’re leaving yourself open to getting burned.
Accept Ether as payment
This one is so obvious, yet often people forget about it. Amidst all the investors getting involved with Ethereum and the excitement around the movement, it’s easy to forget that Ethereum is not just a hot commodity or high value stock. It’s designed as a form of currency. And if you run a business, you can accept Ether as payment instead of cash.
There are many different businesses which accept cryptocurrencies as a form of payment. If you are well-versed online (and if you’re reading this, you obviously are), there are tons of places which accept cryptocurrencies as payment.
Ethereum (ETH) has some major problems at the moment. First of all, governments are cracking on ICO, the reason being is that many have turned out to be either fraudulent or bankruptcies. Since most ICOs run on the Ethereum network as an ERC 20 token, the ICO popularity has brought a lot of value to Ethereum in recent years. If the appropriate rules are taken to protect investors Ethereum projects scams can claim a certain legitimacy as a crowdfunding platform. If the Ethereum can survive these two major problems — regulation and transaction speed — this coin will have shown a great resilience but still remain a speculative investment.
In short, there are many different ways to buy Ethereum in some form. Some are easier than others, but with so many options, you’re certain to find something which works for you. Get into the game now, don’t miss out!