Investing in Ethereum - is ETH investment still worthwhile in 2021?
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Ethereum investing for beginners in 3 steps:
We will now show you how to easily invest in Ethereum. We use eToro for this because you can invest in real cryptocurrencies as well as CFDs here - Etoro combines the advantages of a broker and a crypto exchange.
First step: Registering with eToro
First we need to register with eToro. To do this, we click on the link to register with eToro:
In the registration form we enter our username, email and password and accept the terms and conditions:
We then receive a verification email in which we click on the link to confirm our account.
Second step: fund the account
In the next step, we need to operate our deposit to invest Ethereum. To do this, we click on the "Deposit money" button at eToro:
Afterwards we choose the amount and the payment method we want to deposit with and then click on the "Send" button to deposit the amount.
Investing Ethereum with PayPal, Sofortüberweisung and more
In our example we show the investment with credit card.
However, eToro offers other ways to deposit:
Buy Ethereum with bank transfer
Buy Ethereum with a credit card
Buy Ethereum with Neteller
Buy Ethereum with Skrill
Buy Ethereum with PayPal
Buy Ethereum with online banking
Buy Ethereum with Rapid Transfer
Buy Ethereum with Sofort
Buy Ethereum with a debit card
Third step: Invest Ethereum
Once we have funded our account, we can invest Ethereum. To do this, we click on the search field at the top and enter "Ethereum".
The purchase window then opens:
- Buy or sell: In our case, we have to set it to "Buy".
- Trade or order: Here we can choose whether we want to execute the trade immediately (trade) or delayed (order).
- Amount: How much Ethereum we want to invest.
- Stop Loss and Take Profit: At which loss or profit our position should be sold automatically.
- Leverage: With which leverage we want to invest in Ethereum. With leverage X1 we buy real Ethereum, with leverage X2 we buy leveraged Ethereum CFDs.
The Ethereum investment is completed!
Pros & Cons Ethereum Investment
What speaks for and against investing in Ethereum 2021 is easily outlined: Risks and opportunities for Ethereum investors go hand in hand. They vary depending on which investment form and which Ethereum investment strategy you choose.
How can I invest in Ethereum in 2021?
Whether or not you will be able to make money from your investment of euros in Ethereum depends on finding the right investment strategy for you - and generally familiarising yourself with the market.
How can I invest in Ethereum? Which form of Ether investing suits me? What are Ethereum shares? And how do you get Ethereum in the first place? The following sections will clarify this.
1. Buy Ethereum directly
How do you get Ethereum in the first place? You can buy Ethereum on many different crypto exchanges. To make sure you don't get lost in the jungle of offers, the editorial team has tested the best exchanges for you and guides you through the process quickly and easily in an Ethereum investing guide.
How can I invest in Ethereum? Where can I pay for Ethereum in euros? You can find out this and more in our Ethereum investing guide.
Many exchanges require you to have your own Bitcoin wallet when buying Ethereum. With others, you can manage and hold your purchased Ethereum conveniently in your exchange account.
However, due to the risk involved, we generally advise Ethereum investors to get their own Etherum wallet. Because if your exchange goes bankrupt, you will end up with the loss. You can find everything about the Ethereum wallet in our Ethereum investing guide.
Keep in mind that when you invest in Ethereum 2021, you are completely dependent on the price movements when you buy Ethereum.
Also relevant for you in any case are the tax regulations for Ether investing. On our overview page for cryptocurrency investments, we have more detailed information for you.
Our recommendation: Buy cryptos with eToro
- Incl. wallet
- Buy and sell cryptocurrencies directly in the wallet
- Paypal, credit card and instant bank transfer
- Regulated provider
- Real cryptos or CFD trades
2. Trade Ethereum
Investing in Ethereum does not necessarily mean buying Ethereum. If you don't want to buy Ethereum directly and still want to earn money with Ethereum, you can trade it, for example.
To do this, you can turn to one of the many crypto brokers that offer derivative options for crypto traders with their CFDs. Here we have reviewed exchanges and brokers for you.
The advantage of trading with CFDs is obvious: because with CFDs you can often achieve high returns completely independent of the Ethereum price here if you predict the price behaviour correctly. Moreover, you don't need an Ethereum wallet - because you don't acquire the coin yourself.
However, CFD trading involves special risks and requires you to familiarise yourself with this form of investment in order not to make a mistake: Otherwise, you could lose your Ethereum investment completely within just one trade.
Therefore, when you start trading CFDs, you should only make small contributions at first. Above we took you step by step through investing in Ethereum with eToro. In the Ethereum investing guide linked in the previous section, we also go through the procedure.
3. Buy Ethereum Shares
As with buying Ethereum, your investment is also subject to the Ethereum price when buying Ethereum shares. Perhaps the most decisive advantage of share trading is its tradition: share trading is clearly regulated internationally.
In addition, many investors find it easier to invest in shares than to buy cryptocurrencies directly. After all, having to create your own wallet, understanding what a private key is and how best to store it is a deterrent for many. So thanks to Ethereum stock trading, even more people are gaining access to the market.
This makes investing in Ethereum 2021 easier than ever: anyone planning their investment for the medium to long term should urgently take a closer look at this investment option for the Ethereum investor.
The first blockchain stocks already exist today, and you have to choose between them. For example, there are bitcoin mining stocks, blockchain services and Ethereum investment trusts. Follow the link for an overview of the options for buying shares online.
4. Ethereum Mining
The so-called miners are also a vital element for the Ethereum network. Their work creates new blocks on the Ethereum blockchain.
With each new block, in turn, the transactions recorded on the previous block are confirmed and fixed. If no one mined Ethereum any more, the transaction confirmations would no longer be possible and the cryptocurrency could no longer be traded.
To prevent this from happening, cryptocurrencies like Ethereum rely on incentives for the miners and reward them for their efforts. On the one hand, the miners receive Ethereum for each new block. On the other hand, they still receive all transaction fees that accrue on the new block for new transactions.
Proof of Work (PoW)
In PoW, the miners have to decipher cryptographic algorithms and use hardware components such as GPUs to do so. PoW stands for "Proof of Work", which is a special mining process used by many cryptocurrencies modelled on bitcoin. Ethereum is no exception.
With PoW, the decryption difficulty varies depending on the network load. If the algorithm is successfully decrypted, a new block is created. The network then checks whether this actually exists and validates the information written on it.
Due to the enormous energy expenditure associated with mining, the PoW process has been criticised for some time. Ethereum has been planning for years to replace the PoW process with the PoS process ("Proof of Stake"), which is much less energy-intensive.
Ethereum falls: Is it too late to invest in Ethereum?
The Ethereum price has been rising rapidly over the past two years. By the time the big crypto hype of winter 2017/2018 hit, Ethereum's price had already risen by a thousand percent. In January 2018, during the hype, the coin reached a market value of up to 1,200 euros per Ether.
The big crash followed. Ethereum has been falling continuously in value since then and today stands at around 115 euros per coin, its lowest level since May 2017. But when Ethereum falls - is that a good opportunity for investors? Or is it too late to invest in Ethereum in 2021?
When will the Ethereum price rise?
The Ethereum price could fall even further - much further. It is already below the value the coin reached before the hype.
Lack of acceptance and lack of regulations that clearly place cryptocurrencies in the financial world are still putting a strain on the new technologies. Quite a few believe that the market will continue to collapse - and that Ether investing is no longer worthwhile.
Others are convinced that the Ethereum price will break new records in the future, because Ethereum is a widely used technology. Many crypto start-ups use Ethereum's ERC20 standard to launch their own cryptocurrencies on the market.
With this standard and the ERC20 tokens, a separate Ethereum market emerged in the market, which is still flourishing despite numerous competing products in the meantime.
Ethereum development is far from over. The Ethereum Foundation, which is spearheading Ethereum development, has proven many times in the past that it is capable of running a globally operating company and enriching and diversifying the economic world with new ideas.
Understandably, many are unsettled after the Bitcoin bubble burst. Nevertheless, it is likely that blockchain technologies will change the way we trade with each other in the medium term.
Especially the smart contracts, which are an innovation of Ethereum, gave rise to the conviction that the new technology market will probably still have many surprises in store.
Ethereum adoption on the rise
Even though the market is currently in crisis, the many positive signals of the past weeks and months speak a clear language: the acceptance of cryptocurrencies like Ethereum is increasing.
Regulators all over the world are increasingly addressing the issue. The new investment options like Ethereum shares are opening up the market to a wider audience.
The high-risk ICOs are increasingly being replaced by the so-called STOs, which lure investors with, for example, shares in the business profits and a fat plus in security.
With a market capitalisation of around 12 billion euros, Ethereum still has a stable user and investor base that secures the cryptocurrency's continued existence for the time being.
Under these circumstances, the question is not so much whether there is a future for cryptocurrencies. But rather: for which one? And when? Ethereum is well established in the market. There are hardly any reasons to assume that this will change in the near future.
Particularly as a development platform, Ethereum now also plays a major role for those companies that finance their dApps via STOs. Ethereum is no longer just a cryptocurrency, but has created its own Ethereum market. It will probably not disappear so easily.
Volatility: When the slump is followed by a rise and the rise is followed by the next slump
Today the situation is the other way round: there has been no talk of records for a long time, more often one reads of scepticism, of warnings or exaggerated future scenarios, only a few invest.
Those who go against these trends can often profit from them. It is conceivable that just now, when scepticism is at its highest, the time is right for an Ethereum investment.
However, no one can predict this correctly. Investors should not rely on reports. But investors are also often deceived by their own gut feeling. They exit an investment too early or invest too late and at too high a price in a market that is about to correct.
Good time for Ether investing?
As paradoxical as it sounds, it is above all the great scepticism of the present that gives reason to hope that a current investment can pay off handsomely - at least in the long term.
Those who invest now may be among those who profit handsomely from the next big hype - provided they interpret the signs correctly and get out again while everyone else is excitedly investing.
So much for the theory. The advantages of blockchain technology are numerous and you probably already know them: Ethereum is a largely decentralised digital currency that bypasses the middleman (financial institutions like banks) and allows people all over the world to develop dApps on the Ethereum standard ERC20.
Because investments are also possible without a bank account, people who do not have one are given the opportunity to participate in an investor market here for the first time.
At the same time, the technical architecture of the Ethereum blockchain makes it almost impossible to manipulate through a hack. At least, this is considered virtually impossible with the technical means currently available.
Ethereum Investing Tips & Tricks
Our Ethereum investing tips are meant to help you become a good Ethereum investor. Maybe they will help you to avoid beginner mistakes. First of all, we recommend that you only invest as much as you can afford to lose.
This will help you make neutral and tactical decisions and prevent you from suffering losses that can become a problem for you.
Either way, investing in Ethereum is extremely risky. Do not underestimate this risk. Before investing in Ethereum 2021, you should be aware of it.
It is therefore smart not only to invest in Ethereum, but also to look for classic, less risky forms of investment such as shares, and to further diversify your investment portfolio.
"What type of Ethereum investor am I?"
Ask yourself how big your risk tolerance is and whether you prefer to invest in Ethereum for the long or short term. For those who want to make big profits in the short term, CFD trading in particular is an attractive investment option - but one that comes with additional risk.
If you are not so risk-averse, a medium- to long-term investment in Ethereum is probably more suitable. Moreover, those who hold their Ether for at least a year do not have to deduct taxes when realising their profits.
But the Ethereum market has many alternatives in store: Ethereum stocks are also interesting for more cautious investor types if they want to profit from the Ethereum development but do not like to deal with wallets or private keys.
Earn money with Ethereum: numerous possibilities
There are now many different ways to earn money with Ethereum. Investing in Ethereum 2021 is possible via Ethereum Investment Trusts, for example, but also via Banking on Ethereum.
Alternatively, you can trade Ethereum derivatives - or simply buy Ethereum's cryptocurrency Ether directly.
If you buy Ethereum or invest in Ethereum shares, your investment in Ethereum will only develop depending on the market price. The situation is different for derivatives trading with Ethereum at crypto brokers such as our test winner:
Here you can even earn money with Ethereum when Ethereum falls. This is because when trading CFDs, you speculate directly on the price behaviour of Ethereum without acquiring the cryptocurrency itself.
How can I invest in Ethereum? This was explained in the previous sections.
Is an Ethereum wallet mandatory?
If your investment in Ethereum is based on the price development of Ethereum, you can leave your investment with crypto exchanges such as eToro instead of using a wallet.
Our tip: Create your own wallet anyway! Your wallet protects you from unforeseen dangers. If you hold your Ether on an exchange and the exchange goes bankrupt or gets hacked, you might lose your investment.
It's smart not to invest in just one form. Don't limit yourself to one Ethereum investment alone. It's better to hold multiple investments. At least five assets are a good target. If you multi-track, you reduce your investment risk. For example, you could buy shares online.
Investing in Ethereum in 2021 is probably still worthwhile. Those who do not buy Ethereum but trade it make themselves independent of price developments to a certain extent.
But even those who buy Ethereum can hope, in view of positive signals, that the cryptocurrency will recover from its low, at least in the medium to long term.
Cryptocurrencies will one day find their way into our everyday lives in one form or another. Ethereum development is in good hands and progressing. It is hardly conceivable today that cryptocurrencies like Bitcoin or Ethereum will no longer play a role tomorrow.
It is more difficult to assess which of the cryptocurrencies will make the running in the coming years. In a high-tech segment like this, innovation can bring about change at lightning speed.
That's why Ether investing in Ethereum buying is anything but a safe investment in the long term - but it is also a great opportunity. If you are looking for security, you should diversify your investments and not rely on cryptocurrencies alone.
Due to the high volatility of the coins, an investment in cryptocurrencies can still produce great returns. The key is to buy the coin of your choice at the right time. You should also have the necessary knowledge of how cryptocurrencies work in detail.
This cannot be answered easily. Many factors play a role, including whether the acceptance of the chosen currency increases, what the purchasing power of investors is like and whether crypto exchange hacks or other bad news can depress the respective price. Ethereum is one of the largest cryptocurrencies, so there is a good chance of decent returns with the coin.
Absolutely. If you assume that the coins will continue to gain in importance in the future, then you should invest in Ethereum. It is not unlikely that more and more transactions will be carried out using digital coins in the medium term.