Ethereum is the world’s perennial second favorite cryptocurrency. The first major innovation in the space since Bitcoin, Ethereum proved it was possible to be much more than a decentralized payment network. Since its introduction of dapps and smart contracts, Ethereum seems poised to transform the internet. It’s also the first coin to seriously take value from Bitcoin’s market cap.
Ethereum has challenges ahead in order for it to complete the vision of Vitalik Buterin. But until then, you can bet that it will be central to the cryptocurrency investment landscape. If you want to buy it in 2018, you’ll need an Ethereum exchange. There are many options, but we’ve selected brokers like Coinbull for their convenience and versatility. No one can know for sure if Ethereum is on the rise, but we believe its story is far from over!
What is an Ethereum Exchange?
Ethereum is a digital currency. There is no physical version of this cryptocurrency. Therefore, it can only be traded on a digital exchange. Ethereum exchanges are like broker sites for stocks and bonds. Users create an account, send in funding, and choose from a variety of options, of which Ethereum is just one. After purchase, Ethereum needs to be sent to an external wallet on your computer or device. From there it can be saved or spent. We’ll cover all of this and more. For now, what Ethereum exchanges are best?
The Best Ethereum Exchanges for 2018
There are probably at least 100 different ways to buy Ethereum in mid 2018. Not all of them are legitimate or convenient for newcomers. So that our readers get the best results, we’ve selected A+ cryptocurrency exchanges that will appeal to several different kinds of Ethereum investors.
Coinbull entered the market last year to give users the single most convenient way to buy cryptocurrency in the world. Coinbull sells CFDs, not cryptocurrencies. A CFD is a futures contract. Users pick a coin and decide whether they think it will go up or down by a specific point in the future. The CFD contract seals the deal. Users pay the market price of X number of Ethereum, and that money gets locked away until the CFD’s time period runs out.
When the time expires, the price of Ethereum is compared to the level where it sat at the start of the contract. If the user anticipated that Ethereum was going to drop in price, and it did so, then they user gets all of her money back, plus the difference in the two prices multiplied by the number of coins in the contract.
Some investors prefer this model because it is easier than owning coins. These users don’t have any interest in owning Ethereum. They just want to make money on it. The CFD model of Coinbull gives them this option. Users have all the profit potential of conventional ownership, minus the difficulties and risk of actually owning Ethereum. This saves the user from having to manage addresses, private keys, transfers, digital wallets, and all kinds of hacks/frauds/scams.
Binance is the world’s most popular cryptocurrency exchange platform. The company debuted in 2017 and has already achieved more than a billion dollars in annual revenue. On Binance, Ethereum is a base currency against which all other supported currencies are traded. Only Bitcoin, Binance Coin, and Tether share this honor.
Ethereum isn’t only used as payment on Binance. You can also trade for it as well. All you have to do is create an account, fund your account with any cryptocurrency that trades against Ethereum, and make the trade on the Basic Exchange. Once purchased, your coins will appear in your Binance Ethereum wallet. From here, send them to an Ethereum wallet that you control on your device, for safe keeping.
Coinbase is the most popular exchange in the world where users can buy Ethereum with fiat currency (Binance doesn’t accept fiat, among many others). Fiat currency is a national currency like the US Dollar or the EU Euro. Users create an account, link their credit card or bank account, and buy Ethereum at a single market price.
Coinbase is safe and regulated. It is also dead simple to use, often called the Facebook of crypto exchanges. This is because it’s made to be so easy, any beginner could figure it out. If you want to try this Ethereum investment thing, Coinbase is a great place to start. The only downside is that Coinbase fees can be pretty high. This is the tradeoff you make when you choose ease of use over all other traits. We don’t hold this against Coinbase, though. It has been bringing millions of new investors into this space, and for that we have very grateful.
Gemini is another great place to buy Ethereum. Gemini exchange was started by the Winklevoss Twins (yes, those Winklevoss Twins). The twins Winkle became billionaires when their early Bitcoin investment shot up in value. The pair wanted to create the perfect exchange where users could buy in just as they did, using fiat money.
Gemini is seen as a direct competitor to Coinbase. The two serve basically the same purpose (only sell the major currencies, easy to use for beginners). However, Coinbase has made some questionable decisions with regard to the Bitcoin Cash split, and have been willing to share customer data with the IRS, so some see Gemini as the better of the two.
For our money, Gemini’s lower fees are what tips the scale in favor of Gemini. On the other hand, Coinbase is scheduled to increase its services offered soon, so who knows which we’ll favor a few months from now. In either case, you’ll be able to buy Ethereum with ease with these platforms.
Storing Ethereum on the Exchange
No matter where you invest in Ethereum, you should never store your Ethereum coins on the exchange from which you bought them. Every conventional exchange will have a wallet that will temporarily store your coins after you buy them. This wallet could theoretically store your Ethereum coins until the end of time, but there’s a major problem with this strategy.
You see, crypto exchanges house millions of dollars in fiat and digital assets at any given time. Even when high quality exchanges store large percentages of user funds in cold storage, whenever your coins are active, they’re reasonably vulnerable. This is because hackers and scammers all around the world want to steal big money from these exchanges. On several famous occasions, they’ve even been successful.
It has been said that there are two kinds of crypto exchanges: 1) Ones that have had funds stolen, and 2) ones that will have funds stolen. We’re sure that there exist today exchanges which will never have such a crisis, but you’re better safe than sorry.
Whenever you buy cryptocurrency, send it to a digital wallet on your computer or other device. Keep this wallet’s keys and passwords safe and secret. You can see the best crypto wallets on another page.
Best Ethereum Exchange Conclusion
In the end, the best Ethereum exchange for you is the one on which you buy your Ethereum. We can talk about relative fees and services all day, but until you actually pull the trigger on Ethereum investing, you’ll be on the outside looking in. We think that Ethereum has real prospects for the future, and that at the end of this extended bear market, Ethereum will be situated at the top of the heap.
We can’t tell you to do with your money, or what the price of Ethereum will do even one hour from now. Do your due diligence before investing. If you conclude (as we have) that Ethereum has real investment potential, we think you’ll be well served by the exchanges in the review above. One or more may serve your needs at various times in your crypto investment journey, and all options have our seal of approval. We hope that if you invest in Ethereum, you have incredible returns that will make all of this effort well more than worth it!