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A Beginner’s Guide to Ethereum: Buy Ether Now Or Wait?

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When is it a good time to buy and sell a particular Cryptocurrency? That is the million-dollar question. Surely, the person who could know the answer would be a multi billionaire by now. There are, however, certain trends and signs one can look out for that may give a good indication of whether or not it is a good time to buy or sell a specific Cryptocurrency. We use Vitalik Buterin’s Ethereum as example.

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What is Ethereum?

Ethereum is a very important crypto in the sense that competition is always good for business. Ethereum was introduced in 2013 by a crypto researcher and developer Vitalik Buterin. It is currently the second most popular Cryptocurrency, following Bitcoin and is said to be the next Bitcoin. Ethereum differs from Bitcoin in the sense that it introduced smart contracts to the industry. It has relatively the same qualities as Bitcoin – it is open-source and built on Blockchain, which defines its abilities and characteristics. Enabled by Ethereum, a smart contract is a computer algorithm that allows users to build or develop innovative tools and systems to perform various tasks. These smart contracts run on Blockchain and eliminate the need for third parties. It can save one a lot of time and money.

The market is very much split in two as the majority of investors put their money in both Bitcoin and Ethereum. Ethereum’s token that you can trade with on exchanges is called an “ether” and can be bought or sold not only for Bitcoin, but also for any popular fiat currency like USD or EUR. Some cryptocurrency exchanges even offer an option of converting ETH to GBP, which can now bring you around £340 per coin.

Ethereum was forked in 2016, and Ethereum Classic (ETC) was introduced to the market. There are currently talks of another fork for Ethereum Classic that is expected to happen sometime in December 2017.

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The latest on Ethereum

In order to determine whether or not it is a good time to invest in a Cryptocurrency, one should keep an eye on the news. News greatly affects whether a coin’s price will spike or take a hike. Remember – buy the rumor, sell the news.

According to CryptoCoins News, Mike Novogratz, an investor, predicts that the price of Ether could skyrocket till the end of 2017. Currently, the price of Ether in USD is $437. This follows the Ethereum Foundation introducing new scaling solutions like Plasma and Casper. Ethereum can now allow for more transactions than the Bitcoin network. Bitcoin is a bit slow at the moment. Ethereum is said to have had an upgrade recently, and it will do away with unnecessary information “clogging” the system. It will also allow Ethereum’s blockchain to perform even faster while the productivity will increase to 550,000 transactions per day.

If you want to stay on top of Ethereum and watch your investment grow, monitor market changes through sector-specific announcements, news sites, charts, etc.

Should I buy Ethereum now or wait?

Various crypto analysts and experts give their opinion regarding the question at hand.

Novogratz was quoted in Fortune in May 2017 that he would consider buying more Ethereum if the price drops to $150 or $200. This means Ethereum would have a market cap of more or less than $20 billion. Novogratz told the news site that he believes the crypto market “has much further to run.”

On another note, when a particular coin’s price spikes, a lot of people want to jump in and buy immediately. This is not the right thing to do. Buy low, sell high, and repeat. Normally, when a coin has spiked, the market will take back 60%. By making use of some analytical tools, you can determine where this point will be. This is generally a good entry point. Despite of these and other trading tools, there is no guarantee in this industry. Majority of the time it is better to invest in a coin for a long term rather than for a short term.

One can also opt for dollar-cost averaging. It is a clever investment strategy when one buys a particular coin every month on a specific date. You may buy $100 Ethereum every 15th of a month and, over the long run, you will see your investment grow. The truth is that no one can really predict what the market will do, and sometimes it is better to buy now. It may happen that the price will never go down again.

The one thing that is great about cryptos is that you can buy a part of an Ethereum. For example, you can have a fifth of a Bitcoin or Ethereum, and if you do some day trading, you can easily grow this into one or even two coins.

It is really up to you if you want to buy Ethereum today or wait for the price to get lower. Before you invest, ask yourself this question: How much are you ready to lose?

Ethereum price predictions for 2018

According to Coin Spectator, an automated news aggregation service, Ethereum could reach $1,000. This is due to its increasing popularity and innovative technology. It is interesting to see that Ethereum spiked with more than 3,995% during 2017 whilst Bitcoin increased by more than 377%.

According to the website Investing Haven, it agrees with the $1,000 price prediction, adding that if it does not reach this price in 2018, it will surely do so by 2020. The website gives the following three factors as the reason for this prediction:

  • Considering the future supply of Ether, developers may want to ensure that the number of coins remains constant. It may increase now but will stabilize after a while.
  • The increasing demand and use of Ethereum’s smart contracts. The need for decentralized systems is growing on a daily basis. Investing Haven predicts that 5 – 7 years from now there will be a 20 – 30-fold increase in the smart contract apps being used.
  • If the price of Ether continues growing in the same way it is now, it will attract more investors.

Where do I buy Ethereum?

There are hundreds of exchanges where you can buy Ethereum. Here is a list of reputable exchanges for you to consider. Be sure to pick the one that perfectly suits your particular needs and offers a reliable and transparent service.

In conclusion, some are saying that there is a strong possibility that Ether could eventually be worth more than Bitcoin. Investors are constantly looking out for the next best investment – maybe this is one of those?

Featured image courtesy of Shutterstock. 

 

 

Important: Never invest (trade with) money you can't afford to comfortably lose. Always do your own research and due diligence before placing a trade. Read our Terms & Conditions here. Trade recommendations and analysis are written by our analysts which might have different opinions. Read my 6 Golden Steps to Financial Freedom here. Best regards, Jonas Borchgrevink.

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As an expert on Bitcoin-related topics, Mary Ann found myself as a Journalist at Cex.io - a cryptocurrency exchange. She is working on articles related to blockchain security, bitcoin purchase guides or bitcoin regulations in different countries.




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2 Comments

  1. andrewmayne1

    December 9, 2017 at 10:24 pm

    With regard to the article about futures trading and bitcoin (https://hacked.com/futures-trading-bullish-or-bearish-for-bitcoin/#comment-4523), which recommended to sell Bitcoin for now – do you have any view on whether we should be selling our Ethereum?

    I know it’s hard to tell, the other article suggested that either when bitcoin drops, ethereum could also drop, or it could see a rally as people move out of bitcoins. Wondering whether the author is cashing out their alts as well as their bitcoins?

  2. saxonlucius

    December 10, 2017 at 4:19 am

    Maybe it is good to buy now and hold. I don’t think Ether will go back down. I think in 2018 a LOT of people are going to be entering into crypto and the value is going to go way up. 2018 is going to be a big year for this. Its getting more user friendly. Smart contracts have to get more user friendly and more and more people will be able to do it without development skills. I don’t think anything is going to go down. I think monero might just keep flying up also. The beginning of all this is starting now and within like 3 or 4 months they will all be up. This is the rise of global currency backed by computers that are very quickly becoming part of us. All of this is awesome and kinda scary. lol. I think buy as much as possible now and keep putting money in and hold it. Follow the market. Some ICO’s are really good also. NAGA looks like its going to do well. Awesome ARTICLE!!!!

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How to Convert Your Cryptocurrency Back to Fiat Currency

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It is possible that at some point in your cryptocurrency investing journey, you feel the need to sell off some of your crypto. Most of the time, this means you are just converting it back into the USD of cryptocurrency, bitcoin, but you could also be trying to get your money out of cryptocurrency entirely.

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If your goal is to convert back into fiat currency, then there are a few paths you can take. As you might remember when you were first putting your money into cryptocurrency, it isn’t nearly as simple as using a regular brokerage account, but it is getting easier.

Simplest Possible Method

This sort of goes without saying, but if you did acquire your cryptocurrency on an exchange that allows for fiat deposits, you are likely going to be able to convert your money back into fiat with that same exchange. Exchanges known to do this are Gemini, Coinbase, Kraken, and Coinmama, although there are many others that do and it is worth checking yourself.

Exchanges are generally motivated to increase their revenue, and as a result, they tend to have fees set for withdrawal. Not only does this make them money when you withdraw your money, but it also makes it more likely you will keep your money in the exchange and continue trade it, which will also make them more money.

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The final thing you should realize here are that the exchanges may put actual limits on the amount you can withdraw or the time period you must wait before withdrawing. Both of these serve to the same effect as high withdrawal fees, and help them control their liquidity in a way very similar to a bank.

Using Services and Vendors

It is possible you have already moved your money to a separate hardware or software wallet, in which case, it might not make sense to move it back to an exchange, just to pay fees on the withdrawal. There are other ways of getting your cryptocurrency back into fiat, and some of them work out to be quite a bit cheaper.

In fact, websites like LocalBitcoins.com make it possible you to actually sell your cryptocurrency at a premium because of the extra effort. LocalBitcoins does take a fee, but it still works out quite nicely for the seller in the end.

Another option you may find appealing is using your money to directly pay for goods or services. There are an increasing amount of companies that accept cryptocurrency, and this saves you a lot of hassle, as it is working very similarly to LocalBitcoins.com. You are bartering with each other rather than have a third party act as market maker, and the costs are reduced as a result.

Similar to this is the idea of using your cryptocurrency to purchase a prepaid debit card. Services like Monaco and Tenx are making this easier than ever, and it minimized the number of times your money needs to change hands before it is spent.

What to Do About Your Altcoins

If you are trying to convert your altcoins back into cryptocurrency, you will have one extra step. Since most altcoins transact on a different exchange than those that convert into fiat, you will need to sell your altcoin for a more well-known cryptocurrency, and then convert it to fiat.

Generally, users choose to do this using Ethereum, because of the significantly lower network fee. You would sell your altcoin for Ethereum, transfer that Ethereum to your fiat exchange, and then sell back to your fiat currency.

No matter why you’re choosing to convert your crypto back to fiat, it is even nice to know how you would if you were in a pinch or were worried about potential crashes. The best way to think of it is having an escape plan, just in case.

Featured image courtesy of Shutterstock.

Important: Never invest (trade with) money you can't afford to comfortably lose. Always do your own research and due diligence before placing a trade. Read our Terms & Conditions here. Trade recommendations and analysis are written by our analysts which might have different opinions. Read my 6 Golden Steps to Financial Freedom here. Best regards, Jonas Borchgrevink.

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How to Purchase Altcoins

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There is no doubt about it, bitcoin is the first cryptocurrency most of you will have heard about. But after you’ve whet your appetite on this “blue chip” coin, you may wish to expand your horizons into other coins.

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An altcoin, or alternative cryptocurrency, is any coin other than bitcoin. In terms of market capitalization, bitcoin has a total value of $143.9 billion, which is much larger than any of the other cryptocurrencies. At the same time, you have other cryptocurrencies like Ethereum or Ripple that have market capitalization of $66.6 and $26.1 billion, respectively. Those numbers are no laughing matter.

What Makes Purchasing Them Different

The big difference when it comes to purchasing altcoins is the fact that you generally need to use a different exchange than you started off with. Most users are drawn to big, well-known exchanges like Coinbase, because of their ease of use and the quality of their reputation. But Coinbase only allows for the purchase of a few other currencies (Litecoin, Ethereum, and bitcoin cash at the time of publishing). So for any other coins, it is necessary to use a different exchange in order to purchase them.

Getting into these projects early is the equivalent of investing like a venture capitalist, which is exactly why many people are so interested in them. Ethereum went through massive price increases in 2017, and although many projects may end up being worthless, they also have the potential to achieve unicorn status.

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How To Perform the Purchase

To go about making your purchase of whatever altcoin you are interested in investing in, first you must choose an exchange that lists the cryptocurrency in question. Binance is known as one of the best and most trustworthy, so for the purposes of this article, we will assume you are going to use their services.

The only way to get money into Binance is by transferring in Bitcoin, as they don’t allow for fiat deposits. Once you sign up for an account with them, look for your deposit address and use it to withdraw from the exchange you purchased your Bitcoin on. The money should show up right away, and you are now set up to trade on Binance.

The purchase process is easy from here. Find the cryptocurrency pair you wish to trade (BTC/XRP, for example), select it, and enter the amount of money you wish to invest with them. One tip with Binance: you can save money by purchasing some of their proprietary coin, BNB, and applying that towards your transaction fees. This generally results in a 50% discount on the fees, which can add up over time.

Finally, best practices for security are to withdraw your coins to your own wallet. However, you must make sure that the coins are compatible with your wallet, otherwise they will disappear and be non-recoverable.

Diversification is Healthy

The strongest case for purchasing an altcoin is that you need to diversify out of holding only Bitcoin in the cryptocurrency space. The potential percentage gains are much higher than they are for Bitcoin because of the relatively low exposure the rest of world has had to them. Most investors have heard of Bitcoin, but altcoins are still a very fringe topic.

By taking some of the steps outlined above, you can easily obtain your own altcoins, and increase the potential returns of your portfolio. One last thing: if you really want to get into an altcoin early, you should stay up to date on new ICO’s, since these are likely the lowest prices you will be able to purchase the cryptocurrencies at.

Featured image courtesy of Shutterstock.

Important: Never invest (trade with) money you can't afford to comfortably lose. Always do your own research and due diligence before placing a trade. Read our Terms & Conditions here. Trade recommendations and analysis are written by our analysts which might have different opinions. Read my 6 Golden Steps to Financial Freedom here. Best regards, Jonas Borchgrevink.

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How to Buy Bitcoin Anonymously

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anonymous

As we have previously written about on Hacked.com, many people hold the false belief that bitcoin, by its very nature, is anonymous. However, as transactions recorded on the blockchain are available for anyone to see, this is not entirely true.

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Still, the biggest issue when it comes to privacy arises when someone wants to buy or sell his or her bitcoins for fiat currency. Going through an exchange requires an often lengthy verification process where you need to upload things like your passport, proof of residence, bank statements, etc. It is really a far cry from the privacy that bitcoin and cryptocurrencies were envisioned to offer.

Fortunately, we do have a few solutions to this problem. In this article, we will guide you through four of the ways that exists for buying bitcoin anonymously, either online or offline.

1. Using a bitcoin ATM

With the number of bitcoin ATMs currently exploding, buying bitcoins through an ATM is perhaps the most obvious option for anyone wanting to avoid all the requirements that come with traditional fiat to bitcoin trading.

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The catch with this option, though, is that there is usually a buying limit of around USD 750 before you need to present your ID. However, as long as you stay below this amount for each transaction, your purchase will be completely anonymous.

As bitcoin ATMs are still not very commonly found, you do depend on having one nearby. Currently, about 75% of all bitcoin ATMs in the world are located in North America, with some also found in major European cities.

2. Buying bitcoin peer-to-peer

By far the most popular peer-to-peer bitcoin trading platform out there is LocalBitcoins. Using this platform, you often have the option of meeting up in person with a specific seller who is willing to trade is bitcoin for cash in your local currency. LocalBitcoins have sellers listed in more than 10,000 cities across the world, so there are good chances you will find someone not too far from your location.

All you need to do to start using LocalBitcoins is to sign up on their website with an email address and username, and then start looking for people who are willing to sell bitcoin to you in your area.

Make sure to check the reviews of a seller before you agree to make a trade. Sellers with plenty of good reviews are safe to use, but you should be careful buying from sellers with few or no reviews. There have even been cases where people have been fooled into traps by undercover police officers posing as sellers in countries where crypto trading is illegal or requires a license.

3. Use a prepaid debit card

In the US and some other countries, it is possible to walk into any convenience store and buy a prepaid debit card that you can load up with cash over the counter. You can then use the same card to buy bitcoin on any fiat-to-bitcoin exchange such as Coinbase or Kraken in just the same way as you would have done if you used a debit or credit card from your bank.

This may be a less convenient option, but if there is no bitcoin ATM or LocalBitcoins sellers nearby, using a prepaid card may be your best shot.

4. Using a decentralized exchange (DEX)

Perhaps the most anonymous way to buy bitcoin online is to use a decentralized exchange, something most people in the world of cryptocurrencies are not very familiar with yet.

Decentralized exchanges are largely a new concept, but they are by many seen as the future of bitcoin and cryptocurrency trading. However, current platforms are still a bit complex for non-technical users, but this is a field that is quickly moving forward. Binance, one of the biggest cryptocurrency exchanges today, has even said that they are working on a decentralized exchange expected to be launched in the not-too-distant future.

One such platform already in operation is Bisq, and another option is AirSwap. Both are early players among decentralized exchanges, which is an area that is inevitably set for growth in 2018.

When using Bisq, no ID verification is necessary and the exchange does not hold any of the user’s funds, which also makes it a much safer choice than traditional centralized exchanges. To buy bitcoin using this service, you would make a cash deposit equal to the amount of bitcoin you wish to buy, and then contact a seller directly. Lastly, an escrow service is used to ensure sellers get paid the cash and buyers receive their bitcoin.

Featured image from Pixabay.

Important: Never invest (trade with) money you can't afford to comfortably lose. Always do your own research and due diligence before placing a trade. Read our Terms & Conditions here. Trade recommendations and analysis are written by our analysts which might have different opinions. Read my 6 Golden Steps to Financial Freedom here. Best regards, Jonas Borchgrevink.

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4.3 stars on average, based on 32 rated postsFredrik Vold is an entrepreneur, financial writer, and technical analysis enthusiast. He has been working and traveling in Asia for several years, and is currently based out of Beijing, China. He closely follows stocks, forex and cryptocurrencies, and is always looking for the next great alternative investment opportunity.




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