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Ethereum is often referred to as the second most popular cryptocurrency, after Bitcoin. But unlike Bitcoin—and most other virtual currencies—Ethereum is intended to be much more than simply a medium of exchange or a store of value. Instead, Ethereum calls itself a decentralized computing network built on blockchain technology. Let’s unpack what that means. It’s a common misconception to people who are new to the Ethereum network. You don’t buy Ethereum itself—that’s the network. Instead, you buy Ether and then use it on the Ethereum network. Given Ethereum’s popularity, it’s very easy to buy Ether:
Pick a cryptocurrency exchange.
Crypto exchanges and trading platforms are used to buy and sell different cryptocurrencies. Coinbase, Binance and Kraken are a few of the larger exchanges. If you are just interested in purchasing the most common coins like Ether and Bitcoin, you could also use an online brokerage like Robinhood or SoFi. Be prepared to pay some amount of trading or processing fees almost universally.
Deposit fiat money.
You’ll need to deposit cash, like dollars, in your trading platform or link your bank account or debit card to fund purchases of Ether.
Buy Ether.
Once you’ve funded your account, you can use the money to purchase Ether at the current Ethereum price along with other assets. Once the coins are in your account, you could hold them, sell them or trade them for other cryptocurrencies in the future. Keep in mind you may incur taxes whenever you sell or trade cryptocurrencies.
Use a wallet.
While you could store the Ether in your trading platform’s default digital wallet, this can be a security risk. If someone hacks the exchange, they could easily steal your coins. Another option is to transfer coins you aren’t planning on selling or trading soon into another digital wallet or a cold wallet that’s not connected to the internet for safety.
Pick a cryptocurrency exchange.
Crypto exchanges and trading platforms are used to buy and sell different cryptocurrencies. Coinbase, Binance and Kraken are a few of the larger exchanges. If you are just interested in purchasing the most common coins like Ether and Bitcoin, you could also use an online brokerage like Robinhood or SoFi. Be prepared to pay some amount of trading or processing fees almost universally.
Deposit fiat money.
You’ll need to deposit cash, like dollars, in your trading platform or link your bank account or debit card to fund purchases of Ether.
Buy Ether.
Once you’ve funded your account, you can use the money to purchase Ether at the current Ethereum price along with other assets. Once the coins are in your account, you could hold them, sell them or trade them for other cryptocurrencies in the future. Keep in mind you may incur taxes whenever you sell or trade cryptocurrencies.
Use a wallet.
While you could store the Ether in your trading platform’s default digital wallet, this can be a security risk. If someone hacks the exchange, they could easily steal your coins. Another option is to transfer coins you aren’t planning on selling or trading soon into another digital wallet or a cold wallet that’s not connected to the internet for safety.
