Ethereum is arguably the second-most popular cryptocurrency behind Bitcoin. Readers often want to know how to use Ethereum wallets, trading, and Dapps. Getting started with this digital token is simple. Here are some pointers on using Ethereum if you want to add the cryptocurrency to your existing portfolio.
All cryptocurrency tokens have no actual physical existence. They are stored in crypto wallets which are essentially a type of digital safe. Cryptocurrency wallets come in many forms. There are desktop wallets which are accessed from your computer. Some users prefer hardware wallets like the Nano Ledger. It is even possible to make a paper wallet for your tokens that you can carry with you at all times.
The wallet that you choose will be used to store your Ether. This is the actual token that is associated with the Ethereum platform. Ether is the “gas” that powers transactions on the Ethereum network. A wallet for Ether consists of a set of cryptographic keys that safeguard the wallet’s contents and allow you access.
The Ethereum wallet that you choose is going to depend on some personal preferences. You will have to decide how much convenience and security that you want from your wallet. A general rule of thumb is that the greater the security, the less convenience. The opposite is also true. There is always a tradeoff when you are deciding which wallet to choose.
Desktop Ethereum wallets are those which are installed on a desktop or laptop computer. Some of them may even require you to download an updated copy of the Ethereum blockchain. As a rule these wallets are secure, but accessing them to make transactions can be a hassle.
A mobile Ethereum wallet works similar to a desktop wallet, but it is downloaded to your mobile device. These wallet apps don’t require as much data transfer, but some of them use a light client which doesn’t provide the same level of security.
Hardware wallets for Ethereum offer the high end of convenience and security. These small devices are about the size of a USB thumb drive. They can be carried on your person with ease, and most of them also support other cryptocurrencies besides Ether.
It is also possible for you to store your Ethereum in a paper wallet. This type of wallet is simply a paper copy of your cryptographic keys. These types of wallets are very convenient, and they can be secure as well. The problem comes when you lose the paper wallet. If you haven’t taken the proper steps to back up the wallet then you could lose your Ether forever.
Trading and Buying Ether
Once you have your Ethereum wallet created you will need to purchase Ether. There are several ways that you can purchase this digital token.
You can always initiate a private purchase between yourself and someone that wants to sell Ether. This is easily done when you have a family member or a friend that is willing to sell you some tokens. It can also be arranged with the help of websites that bring buyers and sellers together. If you choose this route, always take safety precautions when dealing with someone that you have never met before.
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For those who do not live in an area where it is possible to purchase Ether from someone directly, a cryptocurrency exchange may be the best option. These exchanges allow you to buy and sell Ethereum, Bitcoin, and a whole host of other cryptocurrencies.
The first step to getting Ethereum from an exchange is to choose an exchange and create an account. You will typically be asked to provide some basic information, and you will need to verify some of that info before you can make deposits and withdrawals. You might need to prove your identity, your address, and other pieces of information. The verification process can vary from exchange to exchange, but it usually only takes two or three days at the most.
Once your exchange account is created and set up you can buy Ethereum. You will most likely be able to use your credit or debit card to buy, but some exchanges may only allow you to purchase Ethereum with another token such as Bitcoin.
A Little About Ethereum and Dapps
Those who are truly invested in the Ethereum platform and want to explore all that it has to offer may be interested in Dapps. These decentralized applications are a hallmark of the Ethereum blockchain. Essentially, they are applications which can be deployed on the Ethereum blockchain to accomplish specific tasks. The automation of such tasks with a Dapp means that no third-party involvement is required.
Those who create Dapps and launch them are required to provide gas in the form of Ether. If you intend to work with Dapps you will need a supply of tokens to finance your efforts. The Smart Contract is another aspect of the Ethereum blockchain that may interest you. It is similar to a Dapp in its function, but works to create a binding agreement between two individual parties. The agreement is then recorded and preserved on the blockchain.
As you can see, there are many reasons to get excited about Ethereum and the future of cryptocurrencies. Let this simple and brief guide serve as your introduction to how to use Ethereum wallets, trading, and Dapps.