How to buy ETH – A Beginner’s Guide

How to buy ETH - A Beginner's GuideTo buy into an ILP or ICO, you’re going to need some ether (ETH). Here is a quick guide on how to buy ETH.

Before you get started, there are a couple of things to bear in mind. Always do your research into any project you’re thinking of supporting, and don’t just buy tokens to try and make a quick buck. You should always read a project’s whitepaper at the very least – if you don’t know what you’re buying into, ask yourself why are you buying it in the first place? You should also be aware of scams and never send your cryptocurrencies to any individuals.

Security should also be a primary concern. Always keep your private key and recovery phrase stored somewhere safe.

Okay, ready?

Register an account with an exchange

To start, you should register with an exchange. There are several popular exchanges you could choose, but most people pick from Coinbase, Kraken, or Gemini.

Account Verification

To use an exchange, you will need to get verified. The verification process is generally the same regardless of what exchange you use. They will all ask to see some form of identification, and some will ask for proof of address too. This is a requirement as exchanges need to comply with anti-money laundering and KYC (Know Your Customer) guidelines.

Verification can be instant, or it can take a few days/weeks. Don’t be surprised if you have to wait a while before getting approved.

Deposit money into your account

Once you become a verified member of an exchange, you are all set to begin depositing funds.

You will need to start by depositing fiat (legal tender such as USD, GBP, EUR, etc.) into your exchange account. You can usually do this via a bank or wire transfer.

Bear in mind some bank transfers can take several business days to clear, although this is not always the case.

How to buy ETH

Once your bank transfer clears and you have money in your exchange, you can now purchase ether.

The interface will differ depending on the exchange that you’ve chosen, but most of them are generally easy to understand once you have spent some time navigating them.

Once you have made your purchase, the cryptocurrency should appear in your account relatively quickly.

Withdraw your ETH into a cryptocurrency wallet

It is always a good idea to withdraw your ether from an exchange as it provides you with a higher level of control and security. All ILPs and ICOs require users to send funds from their own wallet, not from an exchange account, because when you send ETH from an exchange, the exchange sends the transaction from their pool of ETH, not an address linked explicitly to you. Therefore, your tokens won’t be distributed to you. Bear in mind that a small transaction fee is typically required for sending cryptocurrencies.

To withdraw, you are going to want a wallet which can store your ether. You should consider using MyEtherWallet, Edge, or the eesty wallet (especially if you’re joining blockhive’s ILP, since it can hold ether and HIVE tokens together, and it rewards users for sending transactions by giving them eesty’s own ESTY token.)

You can find the eesty wallet and Edge wallet in both Google Play Store and the Apple App Store. If you go with MyEtherWallet, you’ll need to go to their site to sign up.

Send the money from your exchange to your new wallet, and once it arrives, you can participate in an ILP or ICO.

Great! Now you know how to buy ETH.

If you’ve been in the crypto space for even five minutes, you’ll have heard of an ICO, but an ILP (Initial Loan Procurement) is a completely new fundraising method in which you become a creditor to a company rather than just buying and holding tokens. In return for extending credit to the company, you are entitled to interest payments. Using blockhive as an example, this equates to a share in 20% of the profits generated annually.

Participating in an ILP

blockhive has created an innovative solution to the problems ICOs face. Initial Loan Procurements are a fundraising alternative that investors can take advantage of right now. ILPs create a legally binding arrangement between businesses and their investors, allowing businesses to raise the money they desire and investors to gain the security they need.

ILPs are substantially safer to invest in than ICOs because they have been created with government regulation in mind.

blockhive’s ILP is a simple process

Before you get started, have you done your research? Have you read the blockhive whitepaper? Are you ready to keep your private key and recovery phrase somewhere safe?

Step 1: Go to ilp.blockhive.ee and scroll down to the ‘Sign Up’ section. Fill in your email address and enter a password.

Step 2: After successfully signing up, you will now be taken to your Dashboard.

Navigate to the ‘Account Settings’ tab on the left-hand side. This will take you here. Fill in the following info: first name, last name, date of birth, and gender. After doing so, press ‘Save.’

Step 3: Add your Ethereum address in the ‘Sending ETH Address’ section, and click save. Double check to make sure that you have copied your address correctly. You cannot change this address after doing so.

Step 4: Click on the ID Verification tab on the left-hand side. You will be taken here.

Select the country you are in, and the type of document you will be submitting. It is necessary that blockhive has this information so that they can comply with KYC and anti-money laundering guidelines.

You will also need to use the Agrello ID app to complete this.

Step 5: After you have been verified, you can sign your loan contract – this is an important step towards investing in the ILP. Enter your address and then enter a passphrase. Then click ‘Proceed.’

Step 6: You will now be presented with the details about your new ILP contract. Read this carefully. In the top left, there is a button called ‘Crypto View.’ This will show you who the creditor is (you) and who the debtor is (blockhive). It will also show you the Smart Contract Hash. Press the ‘Loan Contract’ button to return to the information about the loan.

Step 7: At the bottom of the loan contract, you will be asked to sign your contract. After that happens, you will officially be a blockhive creditor.

Step 8: You can now send ether to blockhive. Under the ‘Sign Loan Contract’ tab on the left, you will be presented with two pieces of information: Your Ethereum address, and blockhive’s Ethereum address.

When you send Ethereum to blockhive, you are given ‘HIVE’ tokens in return. After blockhive has received your Ethereum the transaction will be complete!

The minimum amount of Ethereum you can send is 0.2 ETH.

Well done! You’ve just participated in your first ILP.

Chronic crypto nut and freelance writer/editor for longer than I care to remember. Have finally found a home here at Crypto Disrupt.