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Beginner's Guide: All You Need To Know Before Buying Ethereum

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How to Buy Ethereum on Topit.Sign up on the Topit platform to create an account. Fund your wallet. Buy Ethereum without hassles, and at competitive rates.

Where is the best place to buy Ethereum? Should I buy Ethereum in 2021?     

You've probably asked yourself these questions, and now you are wondering if it is a good idea to buy Ethereum.  Well, the short answer is YES, and here's the long answer.     

Ethereum has enjoyed increased popularity since its launch in July 2015. Hence it is the second-largest cryptocurrency by market cap, after Bitcoin. This means that ethereum is widely embraced by individuals and businesses globally as a means of exchange for goods and services. Thereby making it a good investment choice for crypto trading.     

However, you may have difficulty getting in on the trade, especially as a first-timer.  Thankfully, this guide provides tips on how to buy ethereum, the best place to buy ethereum, ethereum wallet to use, and how to trade securely and safely.    

But first of all, let's find out what Ethereum is all about...    

What is Ethereum?    

Ethereum is a blockchain-based decentralized computing platform that enables users to conduct transactions, use non-fungible store tokens (NFTs), trade cryptocurrencies, play games, etc. It's best to think of Ethereum as a global supercomputer run by the people who use it. This means that there's no middle-man or third-party interference.    

When you interact with the Ethereum network; send tokens, take part in a crowd sale, or create a contract - you're using the power of the worldwide computer on which it's run. Access to the Ethereum network is powered by Ether, which acts as the cryptocurrency (or crypto-fuel) that powers the platform.    

The easiest way to get Ether is to open an account on a crypto-currency exchange like Topit , Coinbase, or Kraken, fund your account, and then place an order for Ethereum.    

Now, that's a mouthful, but not to worry. In subsequent paragraphs, we'll break down some of these concepts and guide you through the features, benefits, and all you need to know about ethereum.      

Let's get to it.    

What Are The Features of Ethereum?    

When people hear the word Ethereum, they often think of cryptocurrency. But that's just one feature of this technology. Here, we'll discuss some features offered by Ethereum and show you Ethereum's place in the rapidly expanding world of technology.    
Let's jump right in:    

  1.  Ether   

Ether is the peer-to-peer currency for the Ethereum platform. It's used to pay for computation and transaction fees on the Ethereum network and buy gas.    

This is similar to how we use the money to pay for goods, tokens, or services.  You can trade Ether for fiat and other virtual currencies like Bitcoin (BTC). Besides paying for transactions, Ether is also used to buy gas on the Ethereum network.    

Users pay gas fees as compensation for the computational energy required to process and verify transactions on the Ethereum blockchain.    

2.  Smart Contracts    

Next is the smart contract, which is essentially an agreement between two parties that places the agreement's enforcement in the hands of a computer on the blockchain network. For example, a smart contract could be programmed to pay a certain amount of money (shares, property, digital assets, etc.) if the individual agrees to specific terms.    

Also, what gives smart contracts their trustworthiness is that they can't be altered once executed, and any transaction completed on it will be permanently registered. Therefore, even if you modify the smart contract later, the transactions related to the original contract will be unchanged.    

Lastly, anyone can create smart contracts on the Ethereum network.    

3. Ethereum Virtual Machine (EVM)    

One of the key features of Ethereum is the Ethereum Virtual Machine (EVM), which is the runtime environment for smart contracts in Ethereum. It runs on top of the Ethereum blockchain and enables developers to write smart contract code, test it and run it using a large decentralized network of public nodes.    

Similarly, EVM operates in a sandboxed environment that provides languages like Solidity for writing smart contracts.    

4. Decentralized Applications (DApps)    

Decentralized Applications (DApps) run on a decentralized peer-to-peer network, where any single entity does not control them, yet they can still access the internet and the global audience. DApps are created using blockchain technology, which leverages cryptoeconomics, cryptography, computer science, and game theory to incentivize the developers (coders) and users (miners) to contribute to the DApps.    

Also, they're an open-source movement - meaning any developer can contribute to and build on existing protocols and applications. Another critical point to note is that decentralized applications don't have a central authority.    

5. Decentralized Autonomous Organizations (DAO)    

A decentralized autonomous organization, or DAO, is an organization that's governed with no human intervention. It's completely autonomous, not relying on any management structure or hierarchy. The DAO is expected to do everything a regular business does and be completely independent.    


This includes, but isn't limited to:    

  • making decisions    
  • executing transactions    
  • transferring funds    
  • voting on mutually beneficial business operations    

DAOs are built on blockchain technology and use smart contracts to interact. They also receive funding when necessary. Therefore, the potential of the DAO platform is immense and unlimited.    

 

Benefits of Ethereum    

Aside from creating smart contracts and decentralized applications (DApps), there are various other benefits of using the Ethereum network. Let's look at some benefits:    

  1. Non-Fungible Tokens (NFTs)    

NFTs are unique digital assets on the Blockchain, like collectible cards or in-game items. They can be sold and traded on marketplaces. A good example of these includes CryptoKitties, CryptoPunks, and Rare Pepes. These tokens have real-life value and can be used outside the platform they were created for.    


Although collectibles have been around for decades, their digital form is relatively new to the Blockchain. Also, NFTs are easy to create with low barriers to entry.    

2. High-security protocols    

Ethereum provides a high-security protocol through its blockchain technology. It uses cryptography to store securely, send, and receive transactions on the decentralized platform. But, that's not all; Ethereum also uses the immutable nature of blockchain technology.  This prevents the information from being tampered with or changed after being stored on its network.    

3. Low transaction fees    

Another benefit of the Ethereum blockchain is that it offers a more reduced transaction fee when compared with Bitcoin. Although sometimes the Ethereum Gas fee fluctuates, the platform still provides a more convenient and faster transaction method.    

4. Fully immutable system    

One of the key advantages of the Ethereum blockchain is that it provides a completely immutable platform.    

This means that no one can alter the platform's ledger. Therefore, all transaction data on the platform will remain unchanged and permanent. This feature is one of the most significant benefits of the Ethereum blockchain platform.    

Similarly, the platform offers complete transparency because all users in the network can see the transactions made.    

5. True traceability    

Since all data on the Ethereum blockchain is immutable and permanent, all transaction data stored on the ledger can be traced easily. As a result, the system can help companies track their products and transactions and create a complete report on their progress.    

More importantly, it can also help identify any inefficiencies in the system and correct them as soon as they're discovered.    

 

Ethereum vs. Bitcoin    

Ethereum and Bitcoin are open-source, public blockchain platforms that use peer-to-peer (P2P) technology to facilitate operations. The significant difference between them is in their use cases and applications and how they operate.    

Let's look at some key differences:    

1.  Security protocol    

Bitcoin uses a modified version of the Proof of Work (PoW) protocol called Ghash.io, which uses the hashing algorithm to secure networks and validate transactions.     

Ethereum uses Ethash, a PoW protocol that relies on DAG (Directed Acyclic Graph) to structure data, together with several other cryptographic technologies to secure its network.    

2. Block time    

As mentioned above, the turnaround time and confirmation of Ether transactions are faster, usually confirmed in seconds.    

On the other hand, the transaction confirmation time for Bitcoin is slower, typically in minutes.    

3. Overall aims    

Bitcoin was created as a substitute for national currencies, and therefore aims to be a medium of exchange and a store of value.   However, this differs from Ethereum, which aims to serve as a platform to promote immutable, programmatic contracts and DApp platforms.    

 

How to buy Ethereum  

Now that you've gotten a better understanding of the features of Ethereum, its potential benefits, and how this ether-powered network differs from Bitcoin, the next step is to dive into buying Ethereum in Nigeria. For the sake of simplicity and to ease your understanding, we'll focus on how you can trade Ethereum using the Topit platform.    


Below are steps on how to get started:    

#1. Choose a Cryptocurrency Exchange    

The first step in trading cryptocurrencies is choosing the right crypto exchange platform . In simple terms, cryptocurrency exchanges facilitate the buying and selling of cryptocurrencies and other assets such as digital and fiat currencies. For example, several crypto exchanges are out where you can buy Ethereum, such as  Topit , Coinbase, Kraken, Coinmama, etc.    

After signing up for a cryptocurrency exchange site like Topit or any of the platforms mentioned above, you will be asked to provide your name, email address, and password. In addition, you will also be required to provide a phone number and a form of verification for your identity if needed (driver's license or passport).     


These documents are usually compulsory, and they serve as KYC (Know Your Customer) Verification to clamp down impersonification and fraud on Crypto exchange platforms.     

The next step is to fund your account. You need to connect your bank account or debit card to the exchange platform for this to happen. Doing this might attract some fees, so you need to choose a transparent Crypto Exchange platform.  Thankfully, Topit gives you industry-best rates for every transaction you make on the platform.    However, funding your account doesn't mean you've purchased Ethereum yet. It only means that you're ready to make that conversion.    

#4. Place an Order for Ethereum    

After funding your account, enter the value of Ethereum you would want to buy and choose your preferred currency. Note that what you're buying is only a share of Ethereum; this can vary depending on the price of Ethereum and the quantity you want to buy.  The amount you purchased will be displayed as a percentage of the total Ether.    

For most Cryptocurrency exchange platforms, you may need to convert your fiat currency to USD  when you want to buy. Or convert ethereum to USD when you want to withdraw your funds. However, Topit eliminates the need for foreign exchange for the African crypto market.  

Whether you want to buy Ethereum in Nigeria, Ghana , Kenya, Rwanda, South Africa, Uganda, etc., Topit allows you to easily buy ethereum and other cryptocurrencies in your local African currencies. The supported currencies include; KES, NGN, GHC, RAND, UGX, ZAR, etc.    

#5. Store your Ethereum    

After purchasing ETH on the crypto exchange, you can leave your investment in your trading account. However, digital wallets can provide higher security if you want to transfer your assets to safer storage space.     

Topit provides users with a secure crypto wallet with end-to-end encryption and multifactor authentication.    

 

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Topit is a Pan-African cryptocurrency exchange platform that allows Africans to easily buy and sell their local African currencies, including KES, GHC, NGN, ZAR, UGX, etc.