Significantly different to Bitcoin, Ethereum, commonly referred to as ETH, is a decentralised blockchain that boasts smart contract functionality. Ethereum has its own cryptocurrency called Ether, and Ether is considered second to Bitcoin in terms of market capitalisation.
While both Bitcoin and Ethereum are decentralised in certain ways, the former is a decentralised payment system, meaning that there is no central authority that controls the currency. Meanwhile, Ethereum is a decentralised software platform, which means that there is no central authority that controls its code.
In this ETH guide, we’re going to explain everything you need to know about how to buy Ethereum and everything involved in the process. This includes all the different ways you can do it, how to use PayPal to buy Ethereum, which apps to use, the difference between exchanges and brokers, the fees involved, whether or not it’s worth buying Ethereum with PayPal. We’ll also cover all the important things you ought to consider when attempting to buy Ethereum with PayPal.
There are several different ways in which you can buy Ethereum with PayPal. Some may be better in specific circumstances, and they offer advantages and benefits in different ways and for different reasons. Regardless, here are some of the best ways to buy Ethereum with PayPal.
An Ethereum broker is somebody who offers Ethereum and other cryptocurrencies at a fixed value. Or, they allow traders to speculate on their rice fluctuations via Contracts for Differences (CFD).
Buying Ethereum using brokers is actually considered one of the most user-friendly methods for beginners. Essentially, cryptocurrencies are bought and sold on behalf of the customers. A few other advantages of using Ethereum brokers include:
A few of the best options include Etoro, Webull and Coinbase.
Here’s how you can buy Ethereum with PayPal using an Ethereum broker:
A CFD, or a Contract for Differences, is an agreement between an investor and a broker. The buyer must pay the seller the difference between the current value of an asset and its value at contract time. CFDs allow brokers to make money from price movements without having to actually own the underlying assets.
Note, however, that a CFD agreement doesn’t involve the actual value of the asset in question, only the difference in price between the trade entry and exit.
Therefore, essentially what you’re doing is betting on price changes, and this may be upward or downward movements.
Here are some of the advantages of using CFD brokers:
Of course, as with anything, using CFD brokers does come with disadvantages too:
Two of the best CFD platforms available at the moment are Plus500 and Eightycap. Best of all, they’re both ideal for beginners.
An Ethereum exchange allows you to purchase Ether directly from a cryptocurrency exchange. That is, a decentralised exchange is an open marketplace through which you can buy and sell Ether and other cryptocurrencies. Indeed, the marketplaces connects buyers and sellers. Ethereum exchanges swap a trusted third party for code – thus, code is what safeguards the funds involved in the transaction. The funds will only actually be transferred from the seller to the buyer once the payment is guaranteed.
Now, if you’re wanting to buy Ethereum using PayPal, then using an exchange is a great idea. This is because the infrastructure of the system offers robust security, insurance, investment tools and fast transaction speed.
Another advantage of using Ethereum exchanges is that you’ll save money, as the trading fees are low. They also tend to offer excellent customer service.
Here’s how to buy Ethereum with PayPal via an exchange:
P2P platforms allow buyers and sellers to interact directly – that is, peer-to-peer exchanges. Essentially, the seller is able to post their offer on the platform. This includes the cryptocurrency they’re selling, the price, the payment method and the amount of time that the buyer has to make payment. P2P services cut out the middle man. The nice thing about this method is that buyers can choose from a broader selection of payment methods.
A few of the most popular platforms for P2P sales of Ethereum are KuCoin, Paxful and Bybit. These three charge the lowest fees for trading – in fact, KuCoin doesn’t charge anything at all. The one disadvantage is that it can be a bit complicated, so it’s not the best choice for beginner traders.
If you’re looking for the easiest and most convenient way in which to buy Ethereum using PayPal, perhaps a mobile application is the way to go. But if you’d prefer to operate from your computer, you can also use the desktop version – the choice is yours.
To use a cryptocurrency app, make sure you follow these easy steps:
A few of the best options to consider are EToro, Robinhood and Webull. These three generally offer a broad selection of cryptocurrencies, tight regulations, excellent user interface designs and low fees.
Arguably the best and easiest way to purchase Ethereum using PayPal is directly via the PayPal app. The app allows you to make a direct purchase using the funds already in your PayPal account. Or, if you need to top up, you can simply deposit additional money into your PayPal account via your credit or debit card.
One thing that makes this method different to the rest is that it allows you to start making purchases of crypto with a low balance in your PayPal account – as low as $1, in fact. Therefore, you don’t need to be setting aside large sums of money – you can simply work with what you’ve got.
The short answer is yes, generally speaking, PayPal is indeed the fastest way to buy Ethereum. It offers super-fast transactions, making trading incredibly efficient. In addition, PayPal also allows instant deposits. Thus, unless the money is held under review for some reason, you should be able to deposit and start trading almost instantly.
PayPal does make the whole process very cheap compared to other methods. However, there are two costs you need to consider. That is, fees involved in depositing money into PayPal and fees involved in making actual trades on the PayPal app. The former is a free service, while the latter does require a small percentage per trade. Overall, it’s not a big fee, but it’s something to be mindful of regardless.
The nice thing about using PayPal to deal with your money and your trading transactions is that it’s a highly reputable company with strict regulations. This makes everything that it does secure and safe.
Not only do they have a significant amount of experience with regulators around the world, but they’ve also had their financial practices vetted and approved in accordance with the law.
In addition, PayPal utilises a two-factor authentication system. This ensures that the account holder is the only person who is able to log in to their PayPal account, and subsequently deposit or withdraw money or make trades with cryptocurrency. Thus, it’s a very safe system.
These fees differ depending on the route you decide to go – whether it’s a broker or an exchange, etc. It also depends on the platform you choose to use. However, here are some of the most important fees that you’ll generally be charged:
It’s not normally possible for users to maintain anonymity when making payments via PayPal. This is because PayPal requires users to prove their identity and conform with KYC requirements. In fact, filling KYC details is a pre-requisite for making most types of exchanges. This is the case with most centralised platforms.
If maintaining anonymity is a priority for you, you ought to look into trying out decentralised exchanges.
PayPal offers several advantages when it comes to buying Ethereum. However, there are still reasons why some people may prefer to try alternative options based on their specific needs.
Here are a few other ways you can buy Ethereum using USD:
When you’re buying Ethereum, there are several things you ought to keep in mind. This ranges from safety precautions to other additional fees.
Here are some of the most important things to consider when you buy Ethereum with PayPal
Whenever you’re dealing with money, especially online, safety always ought to be your top priority. When it comes to buying Ethereum with PayPal, you’re pretty safe with regards to the security of the actual platform. However, it’s not always wise to store a large amount of one cryptocurrency on a single platform. Thus, what you can do is transfer some of your Ethereum to a cold wallet to keep it safe.
Make sure that you’re purchasing an appropriate amount of Ethereum based on your financial position. As with all cryptocurrencies, Ethereum is volatile. It also tends to involve more price fluctuations, so try not to put all your eggs in one basket.
Do your homework and find a platform that charges the lowest fees. You should be able to find a good one with no deposit fees. However, you’ll still have to pay for withdrawals via PayPal.
Make sure you keep up to date with tax laws on cryptocurrencies in the country you’re operating from. Since cryptocurrencies are still a relatively recent phenomenon, they’re ever-changing, so always make sure you’re in the loop.
