By Arjun Ruparelia
Ethereum is the second-largest cryptocurrency in terms of market capitalization. While it has seen its share of ups and downs since its debut in 2015, it continues to be a popular choice of investment among crypto investors.
This is for good reason, though. Digitalcoin forecasts that Ethereum’s price will surge to $10,650 by 2028 as of this writing.
Investors considering buying Ethereum may want to learn about the best ways to do so. This article hopes to give potential investors the lowdown on the top five ways available to investors to buy Ethereum.
However, let’s get some clarity on what Ethereum really is. After all, it’s hard-earned money and investors should always know what it’s going into.
What is Ethereum?
The first thing that warrants attention is the difference between Ethereum and Ether (ETH). Ethereum is an open-source decentralized blockchain and Ether is the currency used for payment on Ethereum. When an investor invests in Ethereum, they’re essentially converting their USD, CAD, EUR, etc., into ETH.
Ethereum blockchain as a technology is still in its infancy. The blockchain, though, offers an excellent benefit — it supports decentralized applications, or “dApps.” DApps eliminate the need for intermediaries, especially financial intermediaries, such as banks.
This is possible because the Ethereum blockchain can run smart contracts. However, one needs to pay “gas” money with ETH for using these applications.
The potential of this and other features on the Ethereum blockchain, such as smart contracts, is undeniably impressive. The price of Ethereum has surged recently, most of which can be attributed to its strong fundamentals. Let’s look at how the price of Ethereum moved over the past year.
5 Best Ways to Buy Ethereum
It has become astonishingly simple to buy crypto. However, for someone who is buying crypto for the first time and doesn’t know how to go about buying Ethereum in Canada, the U.S., or any other country (except a few like South Korea), following are some of the best options available.
1.Buy Ethereum with a credit card
This is the most cost-effective option for buying Ethereum. Most cryptocurrency exchanges let investors buy crypto using a credit card. For instance, MoonPay has an excellent, user-friendly interface that walks investors through the steps of buying Ethereum.
All they need to do is enter the amount of ETH they want to purchase, enter their wallet address, and make the payment. When they enter the ETH amount, they’ll also see the current price and the number of ETH they will receive.
This is the most preferred buying method given that Moonpay has a no-fuss interface and has been around for quite some time. Of course, there are other exchanges too. If investors already have an account with another exchange, they should continue using that one.
2.Buy Ethereum on PayPal
Almost every other person in the U.S. has a PayPal account. It does make a lot of sense that people would have asked the question – “Can I buy Ethereum using PayPal?” Well, now it’s possible. PayPal has added a way to buy crypto directly from its platform.
Unfortunately, PayPal has some restrictions that make it a less attractive choice for buying Ethereum. PayPal doesn’t allow withdrawals to an investor’s wallet, and neither can they transfer their Ethereum to other PayPal users.
The only thing the Ethereum sitting in a PayPal account is good for is speculating on the price. The good thing is, there’s a workaround. The bad thing is, it only works outside the U.S.
For someone not in the U.S. wanting to buy Ethereum using PayPal while being able to withdraw it, can use eToro. Just follow these simple steps:
- Sign up on eToro.
- Once on the dashboard, click on “Deposit Funds” and select PayPal as the preferred payment method.
- Enter the amount to be deposited and click “Continue.”
- Doing this should redirect to PayPal’s login page. Enter login credentials to log in.
- Confirm the details that appear on the screen. If all looks good, click “Pay.”
The funds should appear in an investor’s eToro account within a couple of minutes. Investors can then go ahead and buy Ethereum, or any other cryptocurrency for that matter.
3.Buy Ethereum with Bitcoin
For someone in the U.S., there’s one last option that will let them use their PayPal funds to buy Ethereum. Well, sort of.
Investors can use a service like Local Bitcoins to buy Bitcoins and make the payment via PayPal. Subsequently, investors can head over to Coinbase Pro and trade those Bitcoins for Ethereum.
Of course, this method also works for someone who isn’t concerned about PayPal and just wants to buy Ethereum with Bitcoin.
4.Buy Ethereum for Cash
If someone runs a business with cash-only transactions, they may be tempted to buy Ethereum with cash that they have lying around. In this case, they can use peer-to-peer (P2P) exchanges. They are decentralized platforms where buyers and sellers come together to trade crypto. Think of them like a significantly less embellished version of eBay.
One of the most reliable P2P platforms is LocalEthereum. It’s well-established and safe enough for spending cash. However, remember that P2P platforms only connect the two parties. The buyer will still be responsible for determining the seller’s trustworthiness.
A good starting point is to head over to the seller’s profile and scavenge for reviews from other users on the platform. Once there has been enough interaction to believe the person is trustworthy, the buyer can connect with them via the platform’s messaging tool.
Be careful, though. This involves arranging a meeting with a total stranger while carrying hard cash in pockets. It’s best to arrange the meeting in a public place.
For those who find this method very risky and prefer something a little less dramatic, there are Ethereum ATMs.
Buyers can use websites like CoinATMradar to locate a nearby ATM. Follow these simple steps to buy Ethereum from an ATM:
- Set up an Ethereum wallet: Buyers can get a wallet from trusted services like MyEtherWallet, Jaxx, or Metamask.
- Find ATM: Use CoinATMradar or similar websites to locate an ATM.
- Place the order: Follow the instructions on the ATM’s screen. Next, choose a cryptocurrency and maybe some verification details.
- Scan the QR code: Search for the public key in the Ethereum wallet and scan it using the camera attached to the ATM. Put the cash inside when prompted.
- Confirm receipt: Once the steps are completed, confirm that the ETH appears in the wallet.
This option is a terrific way to use up some extra cash that has accumulated from business or otherwise. This is particularly helpful for those who run a business where transactions happen only in cash. It’s never a good idea to store all that cash collecting dust in the drawer. It doesn’t grow, and if anything, it’s losing purchasing power if inflation is high.
5.Buy Ethereum from a Decentralized Exchange (DEX)
If an investor exclusively plans on exchanging ERC20 tokens and coins, decentralized exchanges are an excellent option. Decentralized exchanges eliminate the need to store coins on the exchange, which means there’s minimal chance of losing coins to hackers.
While there are many decentralized exchanges, there can be some that aren’t actually decentralized. Be careful while choosing a DEX to ensure it’s a good one. One of the best decentralized exchanges in operation today is Uniswap.
Uniswap allows trading pairs through its smart contracts without involving a centralized exchange in the process. Uniswap deposits the coins into a smart contract that controls the remainder of the trade.
The only drawback of Uniswap is its high fees. However, the fees are a good way to build the exchange’s liquidity pool which will help reduce the prices in the future.
Even though decentralized exchanges provide immunity from hackers, Uniswap has had instances where coins were stolen out of smart contracts owing to coding issues. However, this is not specific to Uniswap as ETH and smart contracts, in general, are prone to such vulnerabilities, so always practice caution.
Ready to Join the Elite Ethereum Club?
Ethereum’s future looks bright, to say the least. Decentralized Finance (DeFi) will probably lead the way in making Ethereum a big success.
For enterprises, this means accumulating Ethereum early on will come with significant savings in the future. Investors, on the other hand, will benefit from its triple- or possibly quadruple-digit returns in the long term.
Ethereum’s fundamental strength is far more appealing than that of several other cryptocurrencies. Perhaps, this is the reason that it’s currently the second-largest crypto by market capitalization. While the market cap continues to rise, investors can ride the wave and pocket some gains in the process.
Since there are several ways to buy Ethereum, investors have the option to choose an option that suits them best. For instance, some prefer using a credit card, while others will want to deplete their cash reserves first. We’ve summarized the most preferred ways to buy Ethereum, so unleash that inner investment prowess and start piling up gains – one day at a time.
Author Bio: Arjun Ruparelia
Email – [email protected]
An accountant turned writer, Arjun writes financial blog posts and research reports for clients across the globe, including Skale. Arjun has five years of financial writing experience across verticals. He is a CMA and CA (Intermediate) by qualification.
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