When looking to learn how to trade Ethereum there are a number of factors one needs to get familiar with first. These things include the likes of what is Ethereum, how does this differ from Ether, how can I trade, and how to buy Ethereum. As we navigate through these you will gain a deeper understanding of both ETH and the cryptocurrency markets.
What Is Ethereum?
Understanding the functionality of both the platform and the coin in question is imperative to becoming a successful trader. As we learn how to trade Ethereum, let’s get to grips with the platform. Ethereum was launched in 2015 to world wide acclaim and one of the most successful (at the time) ICOs and is currently the second largest cryptocurrency based on market cap. The decentralized platform is designed to provide developers with a blockchain platform on which they can build their own dapps (decentralized applications), with token standards and smart contract functionality built in. Ethereum provides an open door to developers looking to enter the blockchain space and the platform is fueled by the cryptocurrency Ether (ETH).
This token is required in all activity on the platform, including gas fees. Gas fees are fractions of Ether that are required to be paid to compensate the network for processing and validating transactions. Gas fees are measured in units called Gwei, where 1 billion Gwei make up 1 ETH. As Ethereum creates a platform on which other project’s can build their dapps, the more projects there are using the network and ETH, the higher the value, and gas fees, can become.
Ethereum Vs ETH
When comparing the two it is important to understand the difference. While Ethereum is the blockchain platform on which things are built, ETH is the token that fuels the platform. Nothing can be built or processed without ETH. Making things quite confusing, ETH is often referred to as Ethereum, for example when learning how to trade Ethereum you’re actually learning how to trade ETH. Generally speaking, people in the industry can differentiate between the two, however it’s good to know.
How To Trade Ethereum
When wanting to learn how to trade one must first establish two criteria: what your trading goals are and how do you want to trade. There are several different ways to trade Ethereum, so finding one that suits you is imperative to a successful trading endeavour.
Trade Ethereum Long Term
This will involve the trader buying Ethereum and holding it for a long period of time in a secure wallet. The idea here is that the cryptocurrency will increase in value over that period of time and the seller can make a profit when it reaches the price goal established early on. This type of crypto trading can be done seamlessly through the Oobit platform. Simply buy ETH with your credit or debit card (or several other payment options) and store it in your unique wallet that is kept in a state of the art air gapped vault.
Trade Ethereum With Other Cryptocurrencies (Short Term)
This involves the trader buying Etheruem and then trading it against other cryptocurrencies like Bitcoin, Cardano and Litecoin with the intention of leveraging the volatility in order to make profits. Users can do this through the Oobit platform by using the Swap feature. This allows users to trade cryptocurrencies with minimal fees, only paying the networks’ miners for processing the transaction.
Trading Ethereum CFDs
CFDs are trading instruments and stand for “contract for difference”. These revolve around buying a CFD on a certain cryptocurrency and speculating the price difference. The contract states that the one party, typically the broker, will pay the other party, typically the investor, the difference in the value of the cryptocurrency from the opening of the trade to the closing of it. Long positions speculate that the price will rise while short positions speculate that the price will fall. This is typically a short term investment and should be done through a trusted platform.
How To Buy Ethereum
When deciding whether to buy Ethereum, there are a couple of points to consider which we’ve outlined in another article. Once you are confident in your trading endeavour, you can buy ETH securely and conveniently through the Oobit platform. We have streamlined the process to ensure that not only is it military grade secure, but also highly convenient. You can then store your ETH in your own personal built in wallet, easily accessible through the dashboard in your account. Here is a more detailed guide on how to buy Ethereum.
Enter The Crypto Markets With Confidence
The golden rule of crypto trading is to never invest more than you are willing to lose. The next most important rule is to always DYOR (do your own research). We aim to deliver a strong dose of insightful content in our Oobit blog that will jumpstart your learning experience. Covering everything from what is Ethereum, to how to trade Ethereum, to trading tips for new traders, we’ve got you sorted.