www.banklesstimes.com
HomeCryptocurrency HubInvest in Ethereum

Invest in Ethereum in 2022

Last updated 18th Jun 2022
Disclosure

Ethereum is the second-largest cryptocurrency token in terms of market capitalization.

Ethereum is a global, decentralized platform for money as well as decentralized applications (dApps). It has been the home to smart contracts, which have been utilized in Decentralized Finance (DeFi) as well as Non-Fungible Tokens (NFTs).

Many altcoins have been developed from Ethereum due to its utility. This article will cover the ways to invest in Ethereum (ETH).

Best Way to Invest in Ethereum in 2022

There are many methods to invest in the Ethereum (ETH) token, especially in 2022. There are hundreds of cryptocurrency brokerages and exchanges that support the Ethereum (ETH) cryptocurrency token.

To make this process a little bit easier for you, we have created a list of the best options.

1
eToro
Minimum Deposit
$200
Exclusive Promotion
User Score
10
More than 3,000 assets, including currencies, stocks, cryptocurrencies, ETFs, indices and commodities
Buy crypto, or trade cryptocurrencies via CFDs
This ad promotes virtual cryptocurrency investing within the EU (by eToro Europe Ltd. and eToro UK Ltd.) & USA (by eToro USA LLC); which is highly volatile, unregulated in most EU countries, no EU protections & not supervised by the EU regulatory framework. Investments are subject to market risk, including the loss of principal.
2
Coinmama
Minimum Deposit
$100
Exclusive Promotion
User Score
9
Easy to use tool
High profit potential
Offers Phone Support
3
Atani
Minimum Deposit
$100
Exclusive Promotion
User Score
9
Popular among traders
Fast system for trading
Popular for beginners
4
UpHold
Minimum Deposit
$1
Exclusive Promotion
User Score
7
High profit potential
Highly rated
Clear user interface
5
Coinbase
Minimum Deposit
$50
Exclusive Promotion
User Score
6
Trade and invest in over 25 cryptocurrencies
Extremely simple user interface
Over 68 million customers

What is Ethereum

Ethereum is a blockchain network that has its own native cryptocurrency token called Ether or ETH for short. It also uses its own native programming language, known as Solidity.

As a blockchain network, it is a decentralized public ledger that is used for the verification and recording of transactions.

ETH works as a platform for other cryptocurrencies and as a means for the execution of decentralized smart contracts.

Ethereum was first introduced in 2013 through a whitepaper which was written by Vitalik Buterin, who, alongside his co-founders, secured funding for the project within a crowd sale in 2014.

Ether (ETH) is the transaction token that is used to facilitate the operations within the Ethereum network.

At the time of writing, Ethereum had a market cap of over $510 billion.

Pros

Ethereum is easier to mine than Bitcoin and it will move to a proof-of-stake (PoS) consensus soon
Ethereum has large support as a lot of other cryptocurrency projects, including DeFi, dApps, and NFTs, are built on top of it
Ethereum has a strong development community

Cons

Transactions cost money in the form of "gas" fees
The number of transactions per second isn’t as quick as some competitors

How Does Ethereum Work

Ethereum is a platform that can be used to create any arbitrary smart contract. This includes smart contracts, which represent digital assets known as Ethereum tokens.

That said, Ethereum tokens are digital assets that are built on the blockchain and benefit from Ethereum's existing infrastructure. Additionally, they also strengthen the entire ecosystem by driving their demand because they are a requirement when it comes to powering smart contracts.

There are contributors to the Ethereum blockchain, which can build code into the contracts that turn them into smart contracts. These transactions on the network contain executable code. When pre-specified conditions are met, the code automatically executes. You can use Ethereum as a digital currency across all financial transactions as a result.

Ethereum thus far has used the proof-of-work (PoW) consensus algorithm in a similar way to Bitcoin; however, it is currently migrating to proof-of-stake (PoS) with the Ethereum 2.0 upgrade.

Ethereum has seen a lot of success due to the boom of decentralized finance (DeFi), where Ethereum Is used for the creation of protocols that replicate traditional financial services.

Ways to Buy Ethereum

There are multiple ways through which you can buy Ethereum (ETH) online with ease.

You can use cryptocurrency exchanges, CFD brokers, P2P marketplaces, or in-person trading.

CFD Brokers

  • Brokerages will allow you to buy or sell the Ethereum (ETH) token through them directly. This will, in turn, provide you with instant access to Ethereum, however, note that the exchange might value ETH higher than it is on an exchange, as they dictate the price of the token. This is a recommended option for beginners because they are simple to use.

Cryptocurrency Exchanges

  • These exchanges offer you some of the best options out there when it comes to Ethereum (ETH) trading pairs. They also have a lot of charting tools as an availability. That said, you will need to have some experience when it comes to cryptocurrency trading.

P2P Marketplaces

  • These are the type of marketplaces that facilitate direct peer-to-peer trading, which means that you directly connect with another person that is selling Ethereum (ETH) and buy it from them.

In-Person Trading

  • This is a type of trading process where you trade face-to-face.

Here is everything you need to know about buying Ethereum (ETH):

Step 1: Create an account and verify it
Step 2: Fund your account
Step 3: Find the cryptocurrency token you want to purchase

How to Invest in Ethereum

Aside from just buying cryptocurrency tokens, you can also invest in the tokens. This is the process where you can speculate if the price of Ethereum (ETH) will go up or down. You can be exposed to the token, and its price swings through this without actually owning the token directly.

That said, here is what you can pick from:

Brokerages

  • You have cryptocurrency brokerages that facilitate the trading of cryptocurrency tokens, such as Ethereum. Furthermore, some even go as far as to offer you specific features to guide you and help you throughout the completion of this process by giving you the opportunity to view charts, copy what other traders are doing, and so on.

Exchanges

  • Exchanges will provide you with some of the best tools out there and will even provide you with additional functionalities, such as yield farming or supporting other projects that launch through the exchange by giving you the chance to invest in them early. They offer an excellent way for intermediate traders to broaden their horizons.

Index Funds

  • Through ETH index funds, you can buy a share of ETH instead of the entire token.

Trusts

  • ETH trusts hold your tokens for you and where you can trade your shares through a brokerage or a cryptocurrency exchange.

Apps

  • There are specific cryptocurrency applications out there that were developed to provide you with the opportunity to trade cryptocurrency assets. They typically require you to download them and create an account, but you have the added convenience of being able to trade from the comfort of your phone, so you can get notified about specific price fluctuations of the ETH token on the go.

Is It Safe to Invest In Ethereum Right Now?

There is always a risk in investing in cryptocurrencies as they are volatile currencies that can change their price at any moment. There are no guarantees that a token might go up or down in value.

In terms of security, it is recommended that you use a regulated cryptocurrency exchange or brokerage that features an SSL certificate and is encrypted, offers 2FA (Two-Factor Authentication), and will conduct KYC and AML procedures across all of its users. Additionally, if you have significant holdings, they should ideally be kept in offline devices.

Khashayar Abbasi

Khashayar Abbasi

Khashayar discovered Bitcoin back in 2014 and has since spent countless hours researching the different use cases of cryptocurrencies. He has a bachelor's degree in International Relations and has been a writer in the financial services industry for nearly half a decade. In his spare time, Khashayar enjoys photography, cycling, and ice skating.