The only cryptocurrency at present that challenges the mighty Bitcoin is Ethereum.
Not only is Ethereum a coin which many people use for making transactions but also a platform on which companies or individuals can create their own apps and run them safely and securely. Therefore, the potential of Ethereum is huge.
In today’s article, you will find out more about the ways in which you can buy Ethereum and the best places to do so.
What Is Ethereum?
Ethereum was launched in 2015 and is a decentralized platform on which people can run applications and make transactions. It is based on the blockchain technology, which guarantees the processes are safe, secure and much faster. Being decentralized means that there is no third parties that interfere – everything is between you and the other person.
The underlying token is called Ether. This is actually what makes all processes run; this is also what people actually buy and invest in. Ethers “create” blocks, which are then linked to a “chain”. The token has two main purposes – an investment and running of applications.
By buying Ethers on exchanges, you can start trading. The other main purpose is to mine tokens and use them for the creation of apps, or sell them later.
Below you can find some facts about the token:
- During the presale phase, 60 million Ethers were created
- 20% of them (12 million) go to the people who have developed and contributed to the project. The rest of the tokens are dedicated to the Ethereum Foundation.
- Every 16-17 seconds, 5 Ethers are created
- If a miner finds a solution to a block, they will receive 2 or 3 tokens as a reward for their efforts.
How to Buy Ethers From an Exchange
In order to have Ethereum, you have to buy the underlying token on an exchange. Once you register, you have to use currencies, such as USD, EUR, GBP and exchange them for Ethers. If you wish, you can store the newly-purchased ethers on the exchange or in a wallet.
The first step is to find a credible online exchange. Below you can check some of the best on the Internet. The process, of course, will vary depending on the exchange, but below are the main steps to follow:
Register an Account
Once you have selected the right exchange for your needs, you have to set up an account by providing some personal data. The exchange will perform a procedure known as “know your customer” (KYC). This happens before you deposit any money or when you make transactions.
They will require from you a photo and a proof of address. This is how they make sure everything goes smoothly and according to international regulations.
After the exchange verifies your account, you will have to deposit some money into it so that you can start purchasing cryptocurrencies. Again, depending on the website, you can choose from a wide range of deposit options: bank wire, PayPal, credit card, a SEPA (Single Euro Payments Area) transfer. Be ready to pay a small fee on the deposit.
When you make the deposit, the money will arrive within hours to several business days depending on the deposit method. Once the money arrives, you can start buying currency.
Best Places To Buy Ethers With a Credit/Debit card
Which are the best places from which you can buy Ethers using a credit card? Let’s take a look:
A US-based digital currency platform and wallet, Coinbase is one the most popular places to trade coins. The exchange currently operates in 32 countries and claims to support 13 million customers. Here you will find a wide range of currencies, including Bitcoin, Litecoin and Ethereum. If you have a Visa or MasterCard you can instantly buy Ethers.
Keep in mind that paying by credit card will cost you 3.75% fee.
Coinmama is an exchange that specializes in buying and selling Bitcoin and Ether with credit or debit card. Unlike Coinbase, which offers their customers a wallet where they can keep their coins, this exchange does not. Therefore, you need to find one where you can store the purchased Ethers.
Currently, the fee they charge is 5.50%.
Established in 2013, this UK-based exchange has the reputation of a secure place. The first step is to create an account and deposit money from a debit/credit card. Then you can buy Ethers or Bitocoins. The process of verification takes a day or two, but once the card is approved, you will be able to operate instantly. By following this link, you will be able to examine their fee schedule.
This exchange has recently started accepting payments with debit/credit cards. Even though the charges are higher than other places, you have the comfort to buy Ethereum anonymously.
Purchase Ethereum With Cash
This is very rare since we are talking about digital currencies, aren’t we?
Of course, in the future there might be ATMs or other places where this will be possible, but currently there aren’t many places where you can buy Ethers with cash.
I agree that many people purchase Bitcoin using cash, but keep in mind that the two currencies differ significantly. If people use Bitcoin primarily to sending money to other people, Ethereum is a network and platform for smart contracts.
Purchase Ethereum Using A Bank Account
Let’s take a look at some of the most popular places where you can buy Ethereum using your bank account.
Let’s start again with Coinbase. The US-based exchange services clients from the USA, Canada, Singapore, the UK and the European countries (excluding Germany). The fees are 1.49% which is much lower than the fee when buying Ethereum by credit card. However, the process will take much longer, around a week if you reside in the US.
Gemini is the first licensed US-based digital asset exchange, regulated by the New York State Department of Financial Services (NYSDFS). Here you can buy Ethers with an ACH (automated clearing house) deposit or wire transfer. Visit this link and check out their fees.
Bitfinex is an exchange where you buy crypto using SWIFT. Keep in mind that the process takes a long time and the fees are relatively low.
Kraken is a large exchange and is the biggest in Europe. If you reside in this continent, then maybe consider using this platform.
Purchase Ethereum With Paypal Using Bitcoin
Nowadays, many people use PayPal to make or receive payments. You can also buy Bitcoins with PayPal and then convert them into Ethereum. There are several places to do that:
1. The Virtual World Exchange (VirWox)
VirWox is perhaps the most popular of the three options. First, you have to buy another cryptocurrency Second Life Lindens (SLL) using your PayPal and then convert it into Bitcoin. Keep in mind that the platform accepts only verified PayPal accounts. The transaction fees are 6% and there are certain limitations as to how many coins you can buy in a day.
If your PayPal account is legit, then it won’t be necessary to provide any other personal information – credit card number, for example.
2. Use peer-to-peer marketplace
An alternative to VirWorx is a peer-to-peer marketplace. These are places where you can directly purchase Bitcoins from your “peers” or simply said, other people. Paxful is one of the places where you can do that. In addition, here you can also buy Bitcoin using credit/debit card. The platform provides customers with instant online chat when they need help. LocalBitcoins is also an option if you want to connect with peers. On the downside, usually these platforms charge between 15 and 20% fees.
3. Use LakeBTC
If you want to buy Ethereum with Bitcoin via PayPal, then the trading platform LakeBTC is worth your attention. Bear in mind that the exchange supports only USD PayPal accounts. When you buy coins you will be able to trade them at once. Nevertheless, withdrawals might take up to a month after you have made the request. The fee the site charges is relatively high – 10%.
4. Purchase Ethereum with Bitcoin
One of the options all traders have is to buy Ethers with Bitcoins.
Well, most people obtain Ethers using the trading pair ETH/BTC.
One of the best places to do that is Poloniex. They are the world’s “most active digital exchange” and their fees range between 01.15 and 0.25%. A note of caution: the website was hacked some time ago. It’s better to move the new coin to your wallet and refrain from keeping them on the exchange.
GDAX is a free alternative to Poloniex, however, the exchange is not as liquid. Other places to visit are already known to you: Kraken, Bitfinex, CEX.io, Gemini and Challengly.
All in all, there are different ways and places from which you can purchase Ethereum. Of course, you can buy them from an exchange using various methods – credit card, bank account, Bitcoin, cash or PayPal. These methods all have their advantages and disadvantages, and whichever you choose, do it wisely.
The Smart Investor content is intended to be used and must be used for informational purposes only. We are not an investment advisor and you should NOT rely on this information to make investment decisions .