5 Things to Consider If You Want to Buy Ethereum Classic
Purchasing Ethereum Classic, or any other cryptocurrency, for the first time can be a slightly intimidating proposition. There is a huge amount to take into consideration, and you want to ensure that your transaction is completely safe, while also attracting the best deal possible.
In order to do this, you need to take several factors into consideration, particularly the following five.
Carefully choose your preferred secure payment method
The location from which you are purchasing Ethereum Classic will have a huge impact on the payment methods available and it is impossible to provide all of the variables here. What you should pay particularly heed to is the speed and cost of each payment method, as this will massively impact on the purchasing process.
Will you need to set up your own wallet?
Before buying Ethereum Classic, it is important to implement your own wallet system. This will help you secure your funds once the transaction has been completed. There are many wallet options available, and we will discuss many of these later in the article, but the first thing to bear in mind is that many exchanges have their own wallets. These are built into the systems for convenience.
There's nothing necessarily wrong with using wallets based within exchanges, but you should bear in mind that they can be more vulnerable to theft. Thus, they are not ideal as a long-term solution. It's also worth knowing that when investors enter into CFD agreements via recommended brokers, their transactions and funds are secured. This negates the need for a wallet.
When purchasing any cryptocurrency, it is always important to consider fees and costs, and that definitely applies to Ethereum Classic. However, it's also important to remember that cryptocurrencies actually attract very small fees compared to traditional currency. This is one of the reasons that cryptocurrencies have become popular as a medium for foreign exchange and it is expected that this will expand further still in the future.
Nonetheless, there can be fees associated with Ethereum Classic, and you should definitely inform yourself of any such costs.
Safety and security
Ethereum Classic is effectively the original version of Ethereum, and as such, retains the system that was included in this cryptocurrency from day one. Cryptography and encryption are built into the Ethereum Classic project, and the system relies upon a Proof of Work (PoW) mining algorithm.
Ethash is the current PoW for Ethereum Classic, but several others are currently under consideration. These include:
ECIP-1070 — ProgPoW: Programmable Proof of Work
ECIP-1049 — Keccak-256: A variant of the Sha3–256 algorithm
ECIP-1043 — Restrict the Dag: Restrict the size of the Dag in Ethash
ECIP-1047 — Reduce Gas Limit: Reduce the gas limit by 8x
The debate over these is highly complex but continues to rage in the Ethereum Classic community.
There was also significant discussion over a mechanism that was referred to by the founders of Ethereum as the Difficulty Bomb. This was intended to help the Ethereum Classic blockchain evolve from its current Proof of Work status to a Proof of Stake system in the foreseeable future. Part of this process would see mining become increasingly complicated.
This so-called Difficulty Bomb was added to the Ethereum network on block 200,000 in an upgrade named Ice Age, but was not accepted by Ethereum Classic users. Indeed, this cryptocurrency upgraded its network in order to permanently eliminate the mechanism. Thus, Ethereum Classic has committed itself to an ongoing PoW consensus system.
There has been some debate over which of these two systems is superior, but there are many enthusiasts within the Ethereum Classic community that remain committed to the original concept.
Can you understand and navigate the platform?
Ethereum Classic is one of the most popular cryptocurrency platforms available and is known for being especially user-friendly. Navigating all of the functionality related to Ethereum Classic is straightforward, and it is notable that its community has opted to retain a mining system that is simpler than its offshoot Ethereum. Overall, this is definitely one of the easier cryptocurrencies to understand.
Ultimate Beginner’s Guide to Trading Ethereum Classic
What is an Ethereum Classic Broker?
Brokers have become extremely important in the cryptocurrency niche, as they have enabled many people to enter the market that would otherwise have found it impossible. Brokers are simply intermediaries who execute trades for investors. They are used across the financial system but are particularly useful in cryptocurrency, which can be considered complex and impenetrable by many uninitiated people.
Due to the explosion in trading on the Internet, and the increasing popularity of cryptocurrencies, Ethereum Classic brokers are widely available. There may be a handful that stick to the biggest tokens, such as Bitcoin, but it shouldn’t be too difficult to find a broker willing to trade Ethereum Classic for you.
What is an Ethereum Classic CFD?
CFD is an acronym for Contract for Difference, and refers to one of the more popular trading mechanisms available. CFD contracts are particularly useful for cryptocurrency, as they enable users to speculate on the direction of price discovery. In short, if you believe that cryptocurrencies, such as Ethereum Classic, are going to descend in value, rather than continue to increase, then CFD contracts are vital.
Essentially, Ethereum Classic CFD trading enables you to benefit from all conceivable market conditions. Another advantage of CFD trading is that it makes it possible for Ethereum Classic investors to trade via margin. This makes it possible to potentially use borrowed money, meaning that you can increase your profits if you invest it sensibly.
What is the Benefit of Regulation?
Regulation of the crypto niche has been coming thick and fast in recent years, and this is definitely a good thing for most investors. The implementation of the legislation by the worldwide financial system has helped to protect the interests of investors and has effectively created a safer cryptocurrency environment for all interested parties.
Not only does this have obvious practical benefits, but it has also resulted in Ethereum Classic and other cryptocurrencies becoming more credible. This can only help cryptocurrencies as an investment mechanism.
What is the Best Payment Method for Buying Ethereum Classic?
Ethereum Classic can be purchased via several different payment methods, although these can differ depending on your location. Here is a summary of the common options available.
Buying Ethereum Classic with PayPal
PayPal has become hugely popular over the last few years, and the digital payment system is widely available for the purchase of Ethereum Classic.
PayPal is reasonable in terms of fees, but there are also cheaper options available and it should be noted that some exchanges do not offer PayPal payments.
Purchasing with Cash
While purchasing Ethereum Classic with cash would attract absolutely no fees, it is practically impossible for most people. Only those who can arrange private transactions with someone they know and trust could possibly use cash to buy ETC.
Via Bank Transfer
Bank transfers are always attractive to investors and purchasers of Ethereum Classic, as they attract no fees at all. But they can be time-consuming and are not approved by all exchanges.
Buying Ethereum Classic with Credit Cards or Debit Cards
There is no doubt that using credit and debit cards is the most convenient way to buy Ethereum Classic, and it would be hard to find an exchange that doesn't accept this payment method. Credit cards do tend to attract high fees, but many investors are willing to overlook this due to sheer convenience.
The Verification Process for Trading
Verification has become a fundamental part of cryptocurrency trading for many users, and this definitely applies to Ethereum Classic as well. When signing up to a brokerage platform, you require a system of identification in order to trade legitimately. And most brokers choose address confirmation, coupled with some government identification, such as passports and driving licences.
Long vs Short Term Investment
When many people consider cryptocurrency, they think about rapid increases in value over short periods of time. And implementing this sort of short-term investment policy has certainly been a popular one with investors. This is similar to day trading of any equity or commodity, where investors attempt to predict peaks and troughs over a short timeframe.
Conversely, a long-term investment strategy involves holding the token and believing in the lengthier market fundamentals of the coin. Of the two strategies, a short-term investment approach can deliver quicker profits, but can also be considered significantly riskier. A longer-term strategy enables users to hold the currency as a physical medium and can be considered a safer approach. However, it still requires an understanding of the markets in order to exit appropriately.
Why Buy, Rather Than Trade?
There is always a debate over whether it is better to buy or trade Ethereum Classic, but the former certainly has a lot of merit. Firstly, by purchasing Ethereum Classic an investor will gain immediate access to a physical commodity (so to speak), which can then be used as a token of exchange or held in the manner of commodities such as gold and silver. This can be viewed as a long-term plan for the cryptocurrency platform, with its founders wanting Ethereum Classic to be accepted as a form of money in the real world.
Another advantage of purchasing Ethereum Classic as opposed to trading the token is that holding the coin over a longer time frame means that you are significantly less vulnerable to market fluctuations. Traders focus on short-term gains, while those purchasing Ethereum Classic have effectively made a fundamental investment in the medium and its long-term market qualities.
Another obvious advantage of buying Ethereum Classic is that it enables you to retain complete control over your own coins. Storing Ethereum Classic and other cryptocurrencies via exchanges is perfectly legitimate, but these are still vulnerable to fluctuations in market conditions, and therefore can crash and disappear completely. This can be disastrous for investors. Additionally, a less serious issue is that there are fewer fees associated with directly purchasing and holding Ethereum Classic, as opposed to storing the token within an exchange.
Regardless of the advantages, though, it is also important to understand that purchasing and holding any cryptocurrency such as Ethereum Classic is a complicated process. It is not something that should be entered into lightly. You should educate yourself on issues such as the setting up of wallets, understanding online security, and the compatibility of systems and software before even considering purchasing Ethereum Classic.
What Fees Are Involved?
Purchasing Ethereum Classic can attract fees, particularly when using the many digital exchanges available but these tend to be pretty small in scale. Nonetheless, before buying Ethereum Classic, you should probably take the following issues into consideration.
Transaction fees for Ethereum Classic are low, and certainly significantly cheaper than Bitcoin. At the time of writing, Ethereum Classic transactions cost around 40 cents. Some exchanges also charge dynamic fees for holding Ethereum Classic in wallets, but these can certainly be avoided by shopping around.
Deposit fees are dependent on the exchange in question and do not vary from one cryptocurrency to another. It may even be possible to find an exchange that doesn't charge deposit fees if you search diligently enough.
The same essentially applies to withdrawal fees, which are set by particular exchanges. However, it is far more common to encounter exchanges that allow free withdrawals, so it’s certainly worthwhile to seek out these particular establishments.
Safely Storing Your Ethereum Classic
It is essential to set up a compatible wallet to store your ETC securely. These will allow you to hold your investment and protect it from potential thieves.
Web wallets are included with broker and exchange platforms. They provide convenient ways of storing Ethereum Classic and other cryptocurrencies, but are not as secure as some of the other options available. Furthermore, it should be noted that sometimes exchanges go out of business completely, so this should also be taken into consideration. An easily accessible option, but not the most secure wallet available.
Mobile wallets are intended to be used with mobile devices, and have become increasingly popular as trading cryptocurrencies via mobile has exploded. There are superior security provisions built into these mobile products, but mobile wallets can be vulnerable to hackers breaking into and taking control of your devices.
Ethereum Classic (ETC) Wallet is the official mobile wallet for Ethereum Classic, but there are others available as well. Exodus is another popular mobile wallet, and you can even create your own at etcwallet.net.
Desktop wallets are designed for use with desktop computers, which can be less convenient than mobile equivalents. But they are also far more secure than mobile wallets, with a range of security enhancements and protocols built into them.
Guarda, Atomic, Ledger, TREZOR One, Metamask, and Mist are some of the many desktop wallet options that are compatible with Ethereum Classic.
Of all of the wallet options available for Ethereum Classic, hardware wallets are the most obviously secure. There are fewer vulnerabilities for these products than some of the others listed here.
Furthermore, hardware wallets store private keys in secure hardware devices, making any serious transfer of data almost impossible. And hardware is immune to any form of virus or worm, while users have the option of validating the entire operation of their wallets.
Nano X has established itself as the most popular hardware wallet for Ethereum Classic.
What Other Coins Can I Trade or Use to Buy Ethereum Classic?
Most of the major crypto can be used to trade or buy Ethereum Classic, while a range of fiat currencies are also available. Most digital exchanges embrace both options.
What’s the Smallest and Largest Amount of Ethereum Classic I Can Buy?
The smallest amount of Ethereum Classic that can be reasonably purchased is 0.0001 coins. There is no upper limit for the cryptocurrency.
Can I Buy Anonymously with no ID? Is it Safe and Legal?
It is certainly safe and legal to buy Ethereum Classic, and an anonymous system has been proposed for this cryptocurrency as well. However, at the time of writing it is difficult to purchase Ethereum Classic while retaining your anonymity.
Will Buying Ethereum Classic Make Me Money?
It is definitely possible to make money from Ethereum Classic, as it is one of the biggest cryptocurrencies in the world, and has seen a massive increase in its market capitalisation during its lifespan. There is no doubt that many investors have made a significant profit from investing in Ethereum Classic.
The longer-term fundamentals associated with this cryptocurrency seem to be positive. It is generally believed that the cryptocurrency niche will expand significantly in the years to come, which will result in some tokens increasing in value. One note of caution would be that Ethereum Classic is of course strongly related to Ethereum, but its offshoot is the more recognised and more valuable.
How to Spend Your Ethereum Classic
Ethereum Classic can be exchanged for other cryptocurrencies and fiat currencies online, and there is a range of other assets, commodities, products, and services that can be purchased with this token.
In real-world locations, Ethereum Classic is less recognised than some of the other cryptocurrencies, but this is beginning to change, as the medium becomes more mainstream.
How to Sell Your Ethereum Classic
The two obvious ways to sell Ethereum Classic would be through a broker or one of the many digital exchanges. Selling coins is one of the most basic aspects of functionality built into digital exchanges, and so this is the most commonly used option. But brokers will also execute trades for you as well, and this definitely merits consideration.
It should also be mentioned that selling Ethereum Classic through a CFD is particularly convenient, as these contracts are traded on a broader basis in the contemporary financial system.