Misc Getting started on buying Ethereum in 2023

Getting started on buying Ethereum in 2023

Undoubtedly, cryptocurrencies have come a long way since their inception, providing many opportunities to make a quick buck and act as suitable long-term investments, with some pundits backing them up as a better hedge against inflation than traditional assets. Bitcoin and Ethereum, the poster boys in the crypto world, have made serious waves in the financial world, whether we look at investors’ portfolios, governmental efforts to regulate digital money, the way blockchain transforms industries, and so on. Indeed, cryptocurrencies went through harsh times as investors pondered whether to drop their investments last year. The collapse of a critical cryptocurrency exchange and the crash of a cryptocurrency that looked otherwise promising are two events that took their toll on cryptocurrencies.

Fast forward, and 2023 brings good news and a glimpse of hope for crypto owners and enthusiasts seeking to take advantage of the cheap prices. Ethereum started the year ascending, and the upward trend continued. Its price exceeded its $2.000 level for the first time this year, experiencing a 6% rise around the moment its most recent upgrade was achieved.

Some cryptocurrency investors and experts believe the bull market may appear sooner than later. However, the only sure thing about cryptocurrency is that nothing can predict the future.

If your savings are lying dormant and you want to put them to better use by investing in Ethereum this year, allow this article to guide you through the steps.

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Decide on a cryptocurrency exchange

You can think of a cryptocurrency exchange’s purpose as you would that of a broker. They’re providing the means to transact with Ethereum, Bitcoin, Binance Coin, etc. Therefore, the best exchange should be among the first things to pop into your mind when giving Ethereum investments a thought. A reliable and good platform makes it easy to invest in cryptocurrency, employs strong security features, provides transparency, and has low fees.

While not everyone shares the same priority and motivation regarding the crypto exchange used, most participants in the crypto sphere analyze the following aspects:

How the crypto exchange works. Most platforms employ the proper tools to deliver a seamless experience and make it easy to navigate the platform to improve user retention. However, to some level, they resemble brokerage accounts through which you transact securities on the stock market. A crypto exchange works as a market-maker that connects you with sellers from which you can purchase your chosen digital coin, say, Ethereum. Then, you can trade your holdings for one another or store them in a cold wallet if you stick to a long-term approach.

• The exchange’s security features. Many exchange companies suffered breaches, collapsed, and jeopardized investors’ funds. This is why you want to ensure the platform you’re entrusting your data and funds with uses proper security tools and minimizes the risk of malicious attacks. Most platforms provide some information in this regard on their websites. While your funds can never be completely safe since a third-party provider holds them, there are several details that can disclose the level of reliability the website provides, like which has the most significant number of customers.
• The exchange’s jurisdiction. See if the exchange provides services for the customers in your country of state. In some cases, you can discover if the platform’s serving users where you live by checking their top-level domain name.

Determine your level of risk

No matter how you slice it, investing in Ethereum or any other cryptocurrency isn’t a risk-free undertaking. Cryptocurrencies are naturally highly volatile assets subject to significant price swings, which can cause your investment to skyrocket or drop in the blink of an eye. This means you should only invest money you wouldn’t otherwise use for basic needs, which won’t leave you bankrupt if your investment doesn’t meet your expectations.

Indeed, no investment guarantees returns, nor does it without risks, so understanding what you’re exposed to is necessary regardless of the financial tool chosen.

Place your order and choose a wallet

In the world of ETFs, mutual funds, and stocks, you can only trade between certain periods, as they imply market hours. On NSE, for example, you can trade between 9:00 and 2:00 and outside of several holidays and weekends. With crypto assets, things work differently, thanks to their decentralized features. You can invest and trade them around the clock.

If you register on a user-friendly platform, you shouldn’t have trouble using it. To buy Ethereum, you’ll place an order by using the platform’s “buy” field. You don’t need to get a whole Ethereum and can buy a fraction of it, depending on how much risk you’re willing to take.

After your order is processed, you’ll need to store your ETH. Most platforms can do the job for you, providing their own wallet. However, some investors choose to put their assets in safe places managed by themselves to reduce the risk of being implicated in a hacking attack. The biggest platforms insure their users’ assets and often keep these holdings offline to secure them from hacks. Generally, exchanges that experienced hacks reimbursed the occurred losses.

If you want to rest assured knowing you’ve minimized the risk of harming your investment portfolio, you can choose between hot or cold wallets.

You can access hot wallets from a connected device, as they work online. Crypto exchanges often offer them for free if you’d instead take your coins off the platform, and they represent a convenient way to store your holdings. However, data breaches pose a risk since they’re connected to the internet.

On the other hand, cold wallets are external devices that don’t rely on an internet connection. Their cost varies depending on the type you opt for. As a general rule, cold wallets are safer and more effective for securing your cryptocurrencies owing to their disconnection from the internet. The only downside here is that they’re less convenient than the hot ones. If you own a considerable number of Ethereum, this is the best type of wallet to protect your holdings.

Investing and protecting your cryptocurrencies shouldn’t be an arduous task, assuming you use preventive measures and common sense.