While Bitcoin is the most valuable cryptocurrency in terms of the value of its coins in circulation, Ethereum isn’t far behind. With a market capitalization of over $331 billion, it is the second most valuable cryptocurrency and has the backing of business leaders such as Mark Cuban.
Furthermore, it has been a profitable investment option. If you put $1,000 into Ethereum in August 2015, it would be worth a whopping $2.23 million almost six years later.
Here’s how to get started buying Ether, the official name of the token also known as Ethereum due to its connection to the Ethereum platform.
1. Determine Your Risk Level
There’s no getting around it: purchasing Ethereum is a risk. While all investments carry some risk, cryptocurrencies are particularly vulnerable to price fluctuations. Consider the impact a few hundred characters can have on cryptocurrency pricing: The value of Bitcoin fell 15% after Elon Musk tweeted that Tesla would no longer accept Bitcoin as payment.
Although Ether has historically produced impressive returns, it has also experienced significant crashes, sometimes in astonishingly short periods of time. Notably, it dropped from nearly $4,000 per coin in May 2021 to less than $1900 in June 2021. That’s a lot of extreme volatility.
That is why, before purchasing Ether, you should consider your risk tolerance as well as the diversity and stability of the rest of your investment portfolio like in the case of xwp. Experts advise never investing more in cryptocurrency than you can afford to lose.
2. Select a Crypto Exchange
Purchasing Ether is a little more difficult than purchasing stocks or mutual funds through your existing brokerage account. Cryptocurrencies are not traded on major exchanges such as the National Stock Exchange (NSE), and many brokerages do not offer cryptocurrency investing.
To purchase cryptocurrency, you must first open an account with a cryptocurrency exchange. In practice, it’s similar to the brokerage platforms you’re probably more familiar with: Buyers and sellers can use cryptocurrency exchanges to trade fiat currencies like dollars for cryptocurrencies like Ethereum, Bitcoin, or Dogecoin. If you don’t already have a cryptocurrency exchange in mind, browse our list of the best cryptocurrency exchanges to find the best one for you. Though the trading platforms of some exchanges can become complex, most offer a simple purchase interface for beginners, though it may charge higher fees than their trading platform.
A couple of key points: When selecting an exchange, ensure that it provides a crypto wallet for storing your investments. The vast majority do, but if yours does not, you will need to purchase one.
This will greatly simplify your cryptocurrency purchasing process, but there is a catch: you will be unable to withdraw your Ethereum investment to store it in a third-party wallet or use it to pay for online purchases. When you use one of these simplified platforms, your cryptocurrency can only be traded on the platform where you purchased it.
3. Add Money to Your Account
You must first fund your account before you can purchase Ethereum on a cryptocurrency exchange. Most of the time, you’ll deposit funds from a bank account, such as your personal checking or savings account. You can also use wire transfers, a debit card, or net banking to deposit money.
Examine the fees charged by the crypto exchange when selecting a funding method; they can vary depending on the method. For example, while wire transfers are free on CoinDCX, net banking is subject to a 0.5% fee.
4. Purchase Ethereum
Market hours limit your ability to purchase stocks, mutual funds, or exchange-traded funds (ETFs). For example, NSE’s trading hours are 9:00 a.m. to 2:00 p.m. and the exchange is closed on weekends and certain holidays.
Cryptocurrencies such as Ethereum and Poocoin as concerned with the poocoin price operate in a very different way: because they are decentralized currencies, you can buy and sell them at any time.
Binocs is a website where you can successfully track your coins and manage your taxes with great ease. Check out the website right away.