Our in-depth guide on how to buy Ethereum with tips on investing, storing, and selling the cryptocurrency.
Buy Ethereum at the Best Crypto Exchanges for December 2022
0.8 to 1.2%
Lending & Staking
Yes, excl. HI, NV, NY, MN
Yes, excluding NY, HI, TX, VT
1-2% on crypto
4 Steps to Buying Ethereum
- Choose an exchange
- Fund (crypto or fiat)
1. Choose an Exchange
As a decentralized cryptocurrency, Ethereum is not available for purchase through a central institution or bank. Instead, like many other cryptocurrencies, ETH (the Ethereum token) can be bought through a crypto exchange.
Exchanges are platforms that allow the buying, storing, and trading of cryptocurrencies. They vary in their fees, cryptocurrency support, and personal disclosure requirements, but they all provide similar financial services. A few of the most popular exchanges are:
Cryptocurrencies can be purchased using other cryptocurrencies or by using “fiat” (traditional) money. Anyone buying crypto for the first time will need to use a government currency like US dollars to complete their initial purchase. You can purchase crypto with several payment methods including:
- Credit cards
- Wire transfers
- Apple Pay
- Other cryptocurrencies
Cryptocurrencies can be bought just like any other digital asset. In this case, once the crypto is purchased, it will become available in a crypto “wallet”. This is similar to a traditional, physical wallet or a bank account. Wallets provide access to the various cryptocurrencies that a person owns.
Due to their decentralized nature, cryptocurrencies like Ethereum cannot be stored in a regular bank account. Instead, crypto wallets are used to protect and transfer crypto assets.
A crypto wallet is a piece of software that can be accessed through a website or a mobile app. There are many companies that provide crypto wallets. An example of one such company is MetaMask.
Each crypto wallet has a wallet address that is used to send and receive money. The same way that traditional banks use routing numbers and account numbers to send and receive funds, crypto wallets use their wallet addresses to send and receive cryptocurrencies.
There are also two types of wallets — software wallets and hardware wallets. Software wallets, such as MetaMask, can be accessed through the internet by entering a private “seed” phrase that acts like a password to grant access to the wallet. Hardware wallets, such as Ledger, are physical USB devices that grant access to their funds when plugged in.
Software wallets are also colloquially known as “hot” wallets, since they are accessible through the internet and can be used by anyone who finds out your seed phrase, while hardware wallets are “cold” wallets that can only be used if physically obtained. Hot wallets are best used for frequent, low-risk transactions, while cold wallets should be used rarely and reserved for safe storage of large cryptocurrency sums and treasured crypto assets.
Top 4 Recommended Ethereum Crypto Exchanges
While there are hundreds of Ethereum exchanges, the biggest ones are usually the most reliable. Here are our top picks:
Uphold was founded in 2015. The exchange is one of the most popular globally, serving 10 million users across 150 countries. You can use Uphold to trade over 200 types of cryptocurrencies and 50+ stocks of well-known companies.
- Broad cryptocurrency selection
- Supports stock trading
- No deposit or withdrawal fees
- High spread fees
- No advanced trading features
- Security concerns – there have been multiple reports of hacking.
Binance is by far the largest cryptocurrency exchange. Its US arm, Binance.us, is a little less feature-rich than its international cousin due to US regulation, but the platform is still a solid choice for anyone looking to buy crypto.
- Wide selection of cryptocurrencies available for trading
- Highly liquid markets due to significant trading volume
- Unlock lower trading fees by paying in $BNB
- Not available in all US states
- Has a history of intense regulatory scrutiny
- Customer service is not the most fully featured
Public.com is an innovative trading platform that aims to remove many of the trading problems other platforms face.
This includes removing the controversial payment-for-order-flow model, adding a social feed element to the trading experience, allowing purchases of fractional shares, and removing account minimum requirements.
Traders can purchase ETH on Public.com through this link.
- No payment-for-order-flow fees
- Social investing aspect where you can view your friends’ portfolios
- Can buy fractional shares in companies
- Made with traditional stock investing in mind
- Small cryptocurrency selection
- Available only through a mobile app
eToro was founded in 2007 with the goal of bringing social investing to millions. The platform has since expanded to offer hundreds of stocks, ETFs, and cryptocurrencies to the US market.
The eToro ETH market can be found here.
- Social investing feature allows you to copy the trades of professionals
- Offers access to stock and ETF trading as well as crypto
- Practice trading account available with $100,000 of test money
- Significantly higher trading fees than many other crypto exchanges
- Cryptocurrency selection is not the best
- Support functionality is just through email tickets
What is Ethereum?
Ethereum is a blockchain that supports the Ether ($ETH) cryptocurrency. Ethereum differs from blockchains like Bitcoin in that it’s not only used for financial transactions but also supports a programming language that allows applications to be built on top of it.
Why Buy Ethereum?
Ethereum is the second highest-value blockchain, behind only Bitcoin.
It is a robust protocol that allows decentralized applications (dApps) to be built on top of it. As such, most of the major decentralized projects have either been built on Ethereum or fully support it. This gives longevity to the protocol, leading many to believe it will be a solid investment for years to come.
- Second most popular cryptocurrency
- Supported by practically every major decentralized application
- Has stood the test of time and remains independent of centralized influence
- High transaction costs (known as gas fees)
- Proof-of-work mechanism uses lots of energy and carries environmental concerns
- Has had several hard forks in the past
Is Now a Good Time to Buy Ethereum?
As of 2022, the cryptocurrency market has undergone two major bull markets. One in 2018, and one in 2021. The first of these saw ETH get to an all-time-high (ATH) of almost $1,400 per token while the 2021 ATH was over $4,800.
The volatile cryptocurrency market normally surges and falls in waves. Many believe that blue-chip tokens such as ETH have many more cycles in front of them and their prices will balloon to new heights much greater than before.
On the other hand, ETH has been around for a long time and a lot of its benefits and future potential have already been priced-in to its current market cap. As the second biggest cryptocurrency, ETH tracks the broader crypto market with its price movements. There are concerns about the scalability of blockchains and even questions around whether the technology is useful for much other than price speculation and anonymous transactions for illicit activity.
Ultimately, any time could potentially be a good time to purchase ETH. You should do your research on the history of the protocol, as well as planned upgrades in the future and come up with a thesis on whether or not Ethereum will be more widely used in the future than it is now. Many such analyses also include price targets.
If your thesis holds that ETH will appreciate, then purchasing some may be a good idea. If you think that ETH has peaked in attention and use, then you can short the token and profit when the price falls. Techniques such as dollar-cost-averaging allow investors to bypass short term volatility and profit if they are correct about the broad strokes of a price movement over time.
Buying Ethereum with PayPal
PayPal added support for cryptocurrencies in 2020.
With a legacy as one of the first secure ways to send money through the internet, PayPal is a fintech giant in the space, so it’s no surprise that it now offers support for cryptocurrency trading. You can buy crypto through the PayPal app and even use your crypto balance to make PayPal purchases with no additional fees.
Buying Ethereum with a Credit Card
Most crypto onboarding platforms support purchasing crypto using a credit card.
These include many wallets such as MetaMask, as well as crypto exchanges like the ones listed earlier in this article. Be aware of any credit card fees that may apply to these different platforms and always keep in mind that any crypto assets purchased through a credit card must comply with laws in the jurisdiction where the assets were purchased.
Buying Ethereum with Apple Pay
Apple Pay is supported by most crypto onboarding platforms.
Wallets such as MetaMask and crypto exchanges like Binance.us, and eToro.com support Apple Pay on their platforms. Apple Pay, in turn, uses credit or debit cards to fund transactions, so it can also be used as an intermediary in purchasing crypto with a card.
Buying Ethereum with a Wire
Each of the crypto exchanges covered above support wire transfers as a means of getting money into your account.
Once your account has a fiat balance, you can use it to purchase any of the crypto assets that the exchanges provide.
Buying Ethereum with Crypto
Since Ethereum is one of the biggest blockchains, most crypto assets can be purchased using ETH.
Buying cryptocurrencies with Ethereum is as easy as using a crypto exchange like the ones covered above, through a wallet with transaction features such as MetaMask, or by making a trade on a decentralized exchange like Uniswap.
Which payment method should I choose?
The two key factors for determining which payment method to use are:
The price of Ethereum can move dramatically, losing or gaining as much as 50% of its value over just a few weeks. To ensure a speedy purchase and to avoid missing your chosen price target, it is advisable to deposit at an exchange well in advance of any trade.
Depending on the country of residence, payment methods like credit/debit card can take as long as 10 calendar days to reach your account. This delay is long enough for investors to miss their buying window entirely.
Other payment methods can be quicker. Bank transfers in the UK can take less than a day to arrive, and some exchanges offer instant deposits via debit card (although these typically come with limits).
Fees are also a key factor to consider when buying Ethereum. Fees can be applied at several different points within a single trade. These come in the form of:
- Banking fees
- Platform fees
- Exchange rate fees
Depending on your country of origin and the banking partnerships arranged by your chosen exchange, there may be a fee at the deposit and/or withdrawal stages of your purchase. This fee will vary by exchange and can be as high as 5%.
It is recommended that those buying ETH consider the country in which their exchange operates and investigate any banking fees before making a purchase. Bank transfers are typically the lowest-cost methods of buying ETH while credit card purchases often incur the highest fees.
Whether trading on an exchange or buying through a simplified platform like Coinbase, there is likely to be a cost incurred as part of the service offered. Exchanges typically charge a fee based on the volume traded which can be as high as 1% of the total trade.
Exchange Rate Fees
Purchasing ETH with US dollars, euros, or pounds is supported by most exchanges. If your local currency is not available for buying ETH, it is still possible to make a purchase, however, it will require the conversion of your local currency into US dollars or a currency supported by the exchange. The process of exchanging one currency to another is typically handled by the platform itself. Keep in mind, however, that each currency conversion normally comes with a fee.
Tips for Buying Ethereum at an Exchange
Exchanges often cater to both new buyers and experienced traders. Coinbase, for example, gives new investors the ability to buy Ethereum through an easy-to-use dashboard. For experienced traders, the Coinbase platform has a “Pro” version which gives access to many more features, lower fees, and more control.
With low fees comes great responsibility. Using a pro-style exchange has enormous upsides but a simple fat finger error can be catastrophic. Here are some tips for using an exchange to buy:
Ethereum at the best price:
- Bids and asks: Every market has a set of sellers and buyers who bid on the price of an asset. These participants provide the market liquidity and, through their bids, decide the market price. For new traders, it’s generally best to use a popular exchange such as Uniswap to guarantee your trades will complete and also fetch the best price.
- Limit vs market orders: Market orders execute as quickly as possible, regardless of the price of the asset being traded, while limit orders will only execute for a set price. For most new traders, limit orders are preferable to market orders as they ensure that the trader does not overpay for their purchase or experience slippage — a phenomenon that causes an asset’s price to rise sharply when purchased in large amounts all at once.
- Market pairs: All cryptocurrency transactions occur as a swap from one asset to another. Exchanges will often allow you to simply purchase popular crypto tokens such as BTC and ETH with fiat like US dollars, however behind the scenes, a swap is occurring in a BTC/USD market pair or an ETH/USD market pair. For less popular cryptocurrencies that are not supported by institutional exchanges, these market pairs must be seeded on either side by market participants — those who have either one of the assets and are looking to trade for the other.
This means that if you are looking to buy a more obscure cryptocurrency, or using the fiat currency of a smaller country, a market pair that supports the two assets you are swapping may not be readily available and you may have to convert your money into a more popular currency in order to make your trade.
Safety tips for buying ETH
Secure ETH Storage
After successfully purchasing Ether from a trusted exchange using fiat currency (USD, EUR, GBP, etc), funds can be stored on the exchange itself or in a secure wallet. For small purchases of Ethereum, users may wish to store their crypto on the exchange for ease-of-use.
For larger purchases, it is recommended that the funds are moved into a secure wallet. Storing funds in a secure wallet ensures that the risk of theft is drastically reduced as long as you take precautionary measures to protect your private seed phrase (which acts like a password for your wallet).
When it comes to secure wallets, there are hot wallets like MetaMask, Rainbow, and Trust Wallet, and cold wallets like Ledger and Trezor. The difference between hot and cold wallets is whether or not they are “internet connected”.
You can think of hot wallets as being “always on”, since they are accessed through an internet browser. Cold wallets, on the other hand, are offline and must be connected to a computer in order to access the funds. Both wallets are password protected and can be backed up using seed phrases. Cold wallets are more secure than hot wallets, while hot wallets are generally more convenient than cold wallets.
Cryptocurrency markets are still nascent so they have looser regulatory requirements than their traditional stock market counterparts. This means that crypto projects can pop up virtually overnight, offering out-of-this-world promises to try and entice people to deposit their money.
While there are rare situations when it’s advantageous to be one of the first traders on a new exchange, or one of the first to buy a hot new project, more often than not, the risks drastically outweigh the benefits. Stories of crypto scams are never far from the headlines, and major exchanges and wallet providers are constantly on-alert for ever-evolving social engineering scams and software attacks.
As a general rule of thumb, remain skeptical of anything that is too good to be true. This includes ETH giveaways, free NFT mints, and anything that ever asks for your wallet seed phrase.
Scammers have notoriously gotten better over the years and have taken to Discord DMs, Twitter, and Telegram to promote shady projects or to impersonate websites and trusted authorities. A good rule to follow is to never click on any links from anyone you don’t recognize and to double check the website domain of an exchange any time you are transferring money or connecting your wallet.
Wallet Security Tips
While easy to avoid, horror stories of users losing thousands of dollars in ETH from a poor understanding of Ethereum wallets and transactions are not rare. Here are a few of the key items to check off when making a transaction of any sum.
Copy and Paste the Address
Never type in a wallet address by hand. Addresses are long and case-sensitive, a single mistake will result in your funds being lost forever. There is no chargeback or customer support number for Ethereum (or most blockchains, for that matter).
Good wallet software will also confirm that the address you are sending to is legitimate. This mitigates the risk of malware intercepting and replacing the address you input.
Check the Transaction Fee
A good Ethereum wallet will show you the calculated transaction fee in dollars and cents. Keep in mind that during times of high network congestion, transaction fees can be as high as $50 or $100 for a single transaction, but always double check that the transaction fee is reasonable before making your trade.
Never Give Away Your Seed Phrase
The only time you should ever use your seed phrase is to log in to your wallet. Once you are logged in, no legitimate transactions will ever require you to re-enter your seed phrase in order to “confirm the transaction” or for any other reason.
When entering your seed phrase to log in to your wallet, check your browser’s address bar to ensure that the website you are on is the actual website of your wallet provider. Scammers will often add an extra character or letter to an otherwise correct website in the hopes that people won’t notice the difference and will use the fake website to siphon your seed phrase.
Be very, very careful when entering your seed phrase anywhere, as it is the single thing keeping your funds safe.
A Note on Exchanges
Securing ETH by leaving your balance on an exchange is a legitimate approach to security, particularly if the funds stored are relatively small in size compared to your overall portfolio. However, when storing coins on an exchange, you do not own the private key to access them.
Essentially, you have handed over responsibility of your ETH to the exchange. Exchanges are not the same as a bank and the same financial regulations do not apply. While most major exchanges are very reliable, it’s important to keep in mind that insolvency or theft may result in lost funds.
Securing Ethereum – The Thorough Way
Hardware wallets are one of the safest ways to secure your Ether. Hardware wallets generate and store your private key offline, and they only come into contact with your devices when they are plugged in. Storing your coins offline in this way significantly mitigates the risk of digital theft.
As with other Ethereum wallets, a seed phrase is provided on creation and a PIN is chosen to secure access to the device itself. It is this PIN and the seed phrase that must then be secured extremely well as unauthorized access to either may result in loss of funds.
The two most respected hardware wallets for Ethereum (and other crypto assets) are Trezor and the Ledger Nano S. Those storing Ethereum on a Trezor device will need to use it in combination with MyEtherWallet (see the full guide here). For that reason, many users opt for the ease of use that comes with the Ledger Nano S.
Additional Security Measures
Whether you choose to store your coins on an exchange, desktop/mobile or hardware wallet, 2 Factor Authentication (2FA) is a highly recommended additional security layer. The 2FA process requires that the user inputs a one time password (OTP) before being able to login to a wallet or send Ether. Google Authenticator is one of the most popular interfaces for 2FA and is used by a range of Ethereum wallets.
Ultimately, the security options that you choose should be based around your risk tolerance. The above information should serve as some inspiration for how best to secure your Ethereum but should not be considered comprehensive. Crypto asset security practices are being developed on an ongoing basis; consult your wallet of choice for recommendations.
A Word of Caution
2FA through an app like Google Authenticator has so far proven extremely secure. However, some platforms choose to bypass the use of an app and instead send a One Time Password (OTP) over SMS. SMS 2FA should be avoided entirely, as the OTP can — in many cases — be observed without needing to unlock a phone.
Social engineering has also been used in the past to convince telecoms staff to port a phone number to a new SIM. If an attacker is able to do this, the phone number by itself can be used to gain access to any Ethereum exchange protected by SMS 2FA.
Ethereum as an Investment
What is Ethereum?
Ethereum is a blockchain — a ledger containing a history of all transactions — that is secured by a distributed network of computers, each working to process and validate transactions. Ether is the currency of the Ethereum blockchain (although “Ethereum” is used interchangeably to describe both the currency and the blockchain) and is issued to those computers that carry out this work. Ether, or ETH, can then be traded easily for fiat currencies like US dollars, or held as a speculative asset. The Ethereum network has millions of participants who can transact with anyone in the world without middlemen.
Transactions on Ethereum are final and immutable. If a transaction is invalid (for example, the user does not have enough funds), then the transaction is not included in the blockchain. The entire history of all valid transactions is stored in identical copies by many different machines in thousands of physical locations. Due to this distributed nature of the Ethereum blockchain, there is no central point of failure and no single point of concentrated influence.
The Ethereum blockchain was launched in July 2015 with a price of less than a dollar and has since climbed through several bull markets, or periods of intense price elevation.
Why Invest in Ethereum?
There are several reasons why a user might choose to buy Ethereum. Here are a handful of examples:
Buying Ethereum as an Investment
- Accessing token sales and other blockchain investments
- Hedging against the incumbent fiat system
- Leveraging ETH through protocols like MakerDAO
Buying Ethereum for Use
- Access to decentralized stable cryptocurrencies like $DAI
- Access to decentralized synthetic assets
- Collecting and trading digital items, such as NFTs
Is It Too Late to Buy Ethereum?
Ethereum has so far achieved two major bull markets — in 2018 and 2021. The all-time-high price for Ethereum reached over $4,800 in November of 2021. Many crypto enthusiasts believe that Ethereum will one day be worth much more than the current record highs. Some even say that each token of the currency may cost millions of dollars and that Ethereum will replace the current fiat financial system as a single global currency.
Ethereum has become one of the most widely-used cryptocurrencies. It’s used by millions of people every day and has garnered the attention of major financial institutions and world governments. Only time will tell if the currency has already reached its peak, but it certainly still has room to grow both in adoption and market cap.
ETH Investment Strategies
Investment strategies vary widely and are subject to your own personal risk tolerance. This guide is for informational purposes only and does not replace the counsel of a financial professional.
Buy and Hold
One of the most common investment strategies for Ethereum is “buy and hold”. Given the volatility of Ethereum, those looking to buy may want to consider “dollar cost averaging“. With this approach, an investor can reduce the level of volatility that they are exposed to in the short term.
Decentralized Finance has also opened the door to income-generating “hold” strategies. Adding ETH to the Uniswap liquidity pool or lending it through Compound are a couple of the many ways to generate yield on idle ETH.
Buy and Diversify
While it is unlikely that Ethereum will disappear anytime soon, purchasing Ethereum in exchange for other cryptocurrencies like Bitcoin is a good way to hedge against unexpected failure. While one coin may fail, many venture capitalists and technologists are in agreement that cryptocurrencies of some nature will become ubiquitous in the future.
Ethereum Price History
While past performance does not predict future results, it does place the market in some context. The price of Ethereum has fluctuated wildly since its Initial Coin Offering which valued ETH at around $0.10. With an all-time-high of over $4,800, Ethereum has risen and fallen in enormous magnitudes, leaving a frothy market of speculation in its wake.
The price history of Ethereum tells one story — unimaginable gains and losses have been possible in the past and could well continue into the future. This asset is one of the most volatile and exciting of all.
Frequently Asked Questions
- How can I purchase Ethereum?
ETH can be purchased through any of the exchanges covered in this article, as well as directly in supported wallets such as MetaMask.
- Can I directly buy Ethereum?
Ethereum is not supported by a centralized institution such as a bank or government. It can instead be purchased through an exchange or a supported wallet.
- Is Ethereum a buy now?
As one of the most popular cryptocurrencies, Ethereum is known to hold its value and appreciate over a long enough time horizon. However, it is still a very volatile asset and has an uncertain future.
- How to buy Ethereum without fees?
Most exchanges will charge a fee of some kind, but popular platforms like Binance.us are known for having the lowest possible fees for purchasing Ethereum and other cryptocurrencies.