The Ethereum network’s native coin, Ether (ETH), ranks as the second-largest crypto by market capitalization in 2024. In this guide, we discuss the network and offer a step-by-step guide on how to buy Ethereum with a credit card.
KEY TAKEAWAYS
• Ethereum is a decentralized platform for building smart contracts and secure applications on blockchain technology.
• ETH, the native asset on the Ethereum network, is the second-largest cryptocurrency by market cap.
• Buying ETH with a credit card has distinct advantages, including convenience, speed, and added security.
• A non-custodial wallet (preferably a cold wallet) is the safest way to store your ETH investment for the long run.
How to buy Ethereum with a credit card
Before we examine each step in detail, here’s a quick snapshot of the process of buying ETH with a credit card.
1. Create an account.
2. Verify your identity.
3. Head to the “Buy & sell” option on the exchange’s app or website.
4. Select Ethereum (ETH) and choose your preferred payment method (e.g., Visa or Mastercard).
5. Enter the amount of ETH you wish to purchase, review the order, and confirm the transaction.
Now, let’s explore each set in a little detail, using Coinbase as an example.
1. Account creation
1. First, visit the Coinbase website and select the sign-up button.
2. Select an account type. You can choose to continue with an “Individual” or “Business” account.
3. You will have to enter an email to continue and will shortly receive a confirmation email thereafter. Simply follow the instructions in the email to continue.
4. Enter your personal information and choose a strong and unique password.
Remember that malicious actors can use social engineering to figure out people’s passwords. Ensure you have a unique and difficult password to minimize the chances of falling victim to such methods.
5. Enter your phone number to continue the registration process. The system will prompt you to enter the verification code sent to your email. Enter the security code sent to your phone via email.
6. Select your citizenship to receive your free Coinbase account.
2. Identity verification
The next step is to verify your identity on the exchange. Some exchanges will allow you to operate in a limited capacity without a know-your-customer (KYC) verification; however, your privileges will be severely restricted in most cases.
1. To continue, select “Get started” to continue with the identity verification process.
3. Enter your personal information and details. This information must be accurate, as Coinbase’s systems will verify its authenticity later on in the sign-up process.
4. Lastly, upload your government-issued documents to complete the KYC process. Once the document is verified, you will officially have an account with upgraded privileges and can begin buying ETH with a credit card.
Crypto exchanges apply KYC protocols to protect the platform and its users from money laundering, corruption, fraud, and other account misuse activities. The steps may vary depending on your location since KYC laws vary from jurisdiction to jurisdiction.
Follow the steps and provide the information required. You may need to continue this process on your mobile device since the verification process may require taking pictures of your documents and of yourself. The site will send you a confirmation email after completing the identity verification process. You are now ready to buy ETH and other cryptocurrencies.
3. Buy ETH
1. Visit the home screen of your Coinbase app and click on the “Buy & sell” option. You can buy ETH with your VISA or Mastercard credit card or other online payment methods, including Apple Pay and Google Pay.
2. Proceed to click on the “Ethereum” button, and the system will direct you to the next page.
3. Here, you can select the preferred payment method. For this example, we’ll use Visa to complete our ETH credit card purchase. Select the amount of ETH you would like, then press “Review order” to continue.
4. Review your order details and make sure that all the details are correct. After this, press “Buy now” to continue and complete your Ethereum purchase.
Remember that the credit card must have the same names as those on your Coinbase account. This is part of the measures to minimize instances of fraud. Enter your card details as prompted. The system will display the transaction details, including the transaction fees and the amount of ETH you should receive.
What is Ethereum?
Ethereum is a proof-of-stake, open-source, and public blockchain network that seeks to provide the infrastructure for applications to run on blockchain technology without downtime, censorship, or third-party interference.
The network was first proposed in 2013. The Ethereum white paper highlighted the network’s goal of offering developers the infrastructure to build decentralized applications (DApps) on a secure, decentralized network.
For developers, the Ethereum network offers the platform to create and deploy smart contracts, enabling the issuance of Ethereum-based tokens and decentralized applications (DApps).
The network participants running Ethereum nodes and staking ETH help to increase security, decentralization, and sovereignty on the network. In return, stakers are rewarded with ETH. Network operations also have gas fee payments that go to the stakers as part of the crypto rewards program. The gas fees depend on the number of computations needed in an operation.
ETH has proven popular with traders on exchanges. As of Aug. 28, 2024, it is second in market capitalization with over $294 billion. The Ethereum price has performed positively since its inception, constituting a 487,700% increase to its all-time high.
Why buy Ethereum with a credit card?
There are a few reasons why someone would choose to buy Ethereum with a credit card, the most obvious being convenience, speed, and security.
1. Security
In terms of security, credit cards are not connected to a checking or savings bank account, which adds a level of security to your transactions. If someone steals your credit card or credit card information and uses it to make a purchase, the funds will not come out of your bank account.
Additionally, credit cards have stringent fraud detection systems. Businesses and credit card companies constantly monitor accounts, sometimes using AI or bots, for large and suspicious transactions. They also skim the web for stolen credit card information on the dark web.
2. Convenience
Credit cards are also popular because they are extremely convenient. One of the most underrated pieces of financial advice today is OPM (i.e., other people’s money). Finance in 2024 depends on debt and credit.
This allows people to utilize future resources (otherwise known as debt) in the present. In the context of buying ETH, this allows you to purchase crypto without using your own money and repay it over time — a good option for those on a budget or building credit.
3. Speed
Rather than utilizing bank transfers, credit card purchases can be significantly faster. Credit card transactions typically take 1-3 business days to complete, while bank transfers can take significantly longer depending on various factors.
Securing your ETH holdings
Learn to safeguard your holdings before buying any crypto with your credit card, including ETH. The market offers the potential for high returns, but its high risk extends beyond price volatility and into losing your assets through scams, rug pulls, hacks, and more.
For Ethereum trading or more control over your ETH and other digital assets, consider a non-custodial wallet where you fully control your digital assets.
You can take the extra step and utilize a multi-signature wallet that enhances your assets’ security by having multiple private keys. This can be a convenient option for a joint investment where all the parties involved have a key and can only access the digital assets together.
“I use a multisig wallet personally to store the bulk of my funds, as does the Ethereum Foundation.”
– Ethereum co-founder Vitalik Buterin: Reddit
If you need a wallet with internet connectivity that can be accessed from different devices, you can use a hot wallet to store your digital assets. The downside of such wallets is they are more vulnerable to hackers and other bad actors.
You can instead use a hardware wallet or an air-gapped wallet, which is disconnected from the internet except when you need to complete a transaction. These are better at shielding you from online threats.
Whichever wallet you decide to use after buying ETH, always remember to do your own research and consider safety practices before proceeding.
Credit cards are a gateway to ETH
Buying Ethereum with a credit card is a fairly straightforward process on crypto exchanges like Binance, Coinbase, or OKX. However, it’s important to securely store your crypto assets, including ETH, using a personal, non-custodial wallet.
By taking this proactive approach, you will safeguard your investments and create a more confident and secure crypto experience.
Disclaimer: This article is for informational and demonstrational purposes only. It is not intended as investment advice. Anyone considering investing in any crypto, including ETH, must understand that crypto is a highly volatile asset class and profit is not guaranteed.
Frequently asked questions
Can I buy ETH with a credit card?
Can I buy ETH on Binance with a credit card?
How can I buy Ethereum in the U.S.?
How to buy ETH for cheap?
Is ETH legal in the U.S.?
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