How to Buy Ethereum in Canada
In 2013, programmer Vitalik Buterin came up with the idea for Ethereum. Initially, Ethereum was supposed to be a decentralized computing platform that took the properties of blockchain and applied them to other digital applications. However, the network’s cryptocurrency (called Ether, ETH, or Ethereum) soon gained popularity. Since its launch in 2015, Ethereum has become one of the most valuable cryptocurrencies available. If you are looking to invest in some Ethereum but are not sure where to begin, then this article is for you. We will discuss how to buy Ethereum as well as answer some commonly asked questions. But first, we will look at what Ethereum exactly is.
What is Etehreum
Ethereum is a decentralized cryptocurrency that is stored on a digital ledger called blockchain. With Ethereum, you can use it to buy various products or services. Or you can use Ethereum as an investment vehicle. The Ethereum blockchain is also home to NFTs. Therefore, Ethereum is often used by people to purchase NFTs. Ethereum is created through a process called mining. Each new Ether coin that is generated through mining is then entered on the Ethereum blockchain.
Currently, Ethereum has a market capitalization of $412.08 billion. This makes it the second most valuable cryptocurrency behind Bitcoin.
How to buy Ethereum
Before you begin, make sure you know the current price for Ether. At the time of this writing (December 2022), the cost of one Ether equals $1,625 CAD (Canadian Dollar). You should also determine how much you are willing to spend on Ethereum. As you can see, Ethereum is an expensive investment. Therefore, it is best to develop a budget/spending limit beforehand.
You will need to get a crypto wallet before you buy Ethereum. Essentially, crypto wallets receive and store your cryptocurrencies. There are two types of crypto wallets, hardware and digital. Hardware wallets (also known as cold storage) are physical devices like USB sticks or hard drives. Digital wallets (also known as hot storage) are usually online or software applications. Out of the two, hardware wallets are the preferred choice, especially for large purchases. Overall, they are more secure than digital wallets where the risk of hacks and system crashes is much higher. The one benefit of digital wallets is their low cost. Once you have your crypto wallet, you can start buying Ethereum.
Choose where you want to buy Ethereum
There are a number of places where you can buy Ethereum. Here are three examples:
- Crypto exchanges: This is most common place to purchase Ether. Crypto exchanges are basically online marketplaces that list and sell cryptocurrencies. Some popular exchanges include Kraken, Coinbase, and Binance. To register for an account, you will have to provide proof of identification like a driver’s license or proof of residence. Crypto exchanges accept various payment methods, like credit/debit cards, PayPal, or wire transfers. Some exchanges even accept other cryptocurrencies as payment.Before you select an exchange, you should do some research beforehand. Make sure your country is supported by the exchange you pick. While most exchanges are international, some only serve specific regions. Also, check to see if your country’s currency is accepted by the exchange. Some exchanges only accept a select number of currencies, with USD (U.S. Dollar) being the most common. If the exchange does not accept your currency, the site will convert your money to one of the currencies it accepts. However, you will be charged a conversion fee.
- Peer-to-Peer Trading: Peer-to-Peer (P2P) trading involves direct trading with another person. This is a more anonymous method of crypto buying. P2P trading occurs on dedicated networks like LocalEthereum. You can use both traditional money or cryptocurrencies to make purchases.
- Ethereum ATMs: To use an Ethereum ATM, you will need to scan a QR code stored in your crypto wallet. Once you scan the code, Ethereum ATM will connect to an exchange. Form there enter your money and select the amount of Ether you want to buy. The Ether will then be sent to your crypto wallet. Ethereum ATMs are sometime hard to find, but you can use the website Coin ATM Radar to locate one in your area. Be aware that Ethereum ATMs are best for small purchases. Transactions times can also take several hours.
Make your purchase
Once you have decided where you want to buy Ether, you can make your purchase. With whichever buying method you choose, be prepared to pay some transaction fees. These can range from 0.5% to 4.0%. After you have completed your purchase, transfer the Ether to your crypto wallet.
Frequently asked Ethereum questions
Is Ethereum a good investment?
The crypto market is highly volatile. Prices for cryptocurrencies can fluctuate significantly, and Ethereum is no different. In May of 2021, Ethereum’s price skyrocketed to $5,294.25. But by mid-July of the same year, the price fell to $2,270.14. This example highlights the unstable nature of cryptocurrencies. Often, the cycle of falling and rising prices is repeated within a short time period. The volatility of crypto means there is an equal chance of wining or losing large amounts of money on your investment.
Overall, Ethereum can be a good investment as long as you keep up to date with the current crypto market situations. If the volatility of Ethereum is something you are worried about, then you can start with small investments. That way, you will not lose as much money if things go bad.
What are the Ethereum price predictions?
Currently, Ethereum’s price is in a cycle of ups and downs. So far, this pattern is constant; the price has not pointed in any set direction. The unstable nature of Ethereum’s price is attributed to several factors: rising inflation, the fledgeling stock market, mainstream adoption of cryptocurrencies, and the war in Ukraine. If these factors persist, then we can expect Ethereum’s price to remain volatile throughout 2023.
On March 9, 2022, U.S. President Joe Biden signed an executive order on cryptocurrencies. The order directs government agencies to implement strategies for regulating digital assets like cryptocurrencies. Experts believe this order will bring some stability to the volatile crypto market for the long term; regulations will be in place to control the buying and selling of cryptocurrencies. Ethereum’s price briefly soared after the order was announced before falling back down. However, due to the new regulations, experts believe Ethereum’s price will reach a stable point in the near future.
Ethereum vs Bitcoin, which is better?
Ethereum and Bitcoin share some similarities. First, both are highly valuable cryptocurrencies. In fact, they share first and second place as the most valuable cryptocurrencies based on their market capitalizations. Both cryptocurrencies operate on a blockchain network, and both are created through the mining process.
However, Bitcoin and Ethereum have some key differences. The set number of Bitcoins that can enter circulation is 21 million. There are no such restrictions with Ethereum; there can be unlimited amount of Ether entered into circulation. Ethereum’s blockchain can be used for other applications besides cryptocurrencies. For example, computer code can be stored on the Ethereum blockchain. The Bitcoin blockchain only supports the Bitcoin cryptocurrency. Lastly, Ethereum and Bitcoin differ on their overall goals. Bitcoin was created as an alternative traditional currency, while Ether was created to compliment the Ethereum network.
With all this being said, which one should you invest in. According to U.S.News.com, Ethereum edges out Bitcoin as the better long-term investment. Their reasoning is that Ethereum is more dynamic than Bitcoin. It is constantly evolving and has more room for growth. Bitcoin was intended to be a currency and investment option, and it has remained so since its launch in 2013. This demonstrates Bitcoin’s lack of utility and growth. So, if you are forced to choose between the two, Ethereum is the better long-term investment. Still, you should own a bit of each to diversify your portfolio.
Is Ethereum eco-friendly?
Ethereum has been criticized for its environmental impact. In one year, Ethereum uses around 112 TWh (tera watts) of electricity and produces 53 megatons of CO2. Additionally, an Ethereum transaction uses 262 kWh (kilo watts) of energy. This is the amount a U.S. household uses during the course of a five-day workweek. The reason for Ethereum’s large carbon footprint lies in a security feature called proof of work. This feature is applied to crypto mining to validate transactions and mine new token. Proof of work requires a large amount of computing power to operate.
Steps are being taken to make Ethereum more efficient. In 2022, Ethereum will be upgrading its block chain network. Known as Ethereum 2.0, the updated will make Ethereum faster and more efficient thanks to a new system called proof of stake. This feature uses less computing power than proof of work to validate mining and transactions. With the update, Ethereum is expected to reduce its energy consumption by 99.95%.
What is Ethereum Classic?
Ethereum Classic was created in 2016 after more than $50 million worth of Ether was stolen from the Ethereum blockchain. To combat the theft, most of the Ethereum community decided to invalidate the existing Ethereum blockchain and replace it with an entirely new version. However, some decided to maintain the original Ethereum blockchain. This caused a split between the two versions and led to the creation of the cryptocurrency Ethereum Classic, also known as ETH.
Ethereum Classic functions much like Ether, and you can buy it on several cryptocurrency exchanges. However, there is a limit to the number of Ethereum Classic that can be created. Additionally, ETC will continue to use proof of work instead of shifting to proof of stake. And compared to Ether, Ethereum Classic has a much lower price: one ETC costs $34.39 CAD. This low price makes ETC a good investment option for cryptocurrency beginners.
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