The Ethereum is the work of Russian-Canadian Vitalik Buterin, who previously worked on Bitcoin. Buterin believed that the bitcoin was in need of a scripting language for application development. However, when an agreement between other developers could not be reached, a proposal was made by him to develop a premier platform with a more varied scripting language. This was how the Ethereum came to be and for a currency, that went live mid-2015, the cryptocurrency has come a long way within the span of two and a half years. Since its release, the Ethereum price has consistently risen, leading it to become one of the most stable cryptocurrencies. Its growing popularity has financial analysts believing that it just might be poised to overtake the Bitcoin as the powerhouse of cryptocurrencies.
Like Bitcoin, Ethereum is a decentralized blockchain cryptocurrency. This means it is secure, private, and not controlled by a central bank. Similar to Bitcoin, an Ethereum wallet is needed to make transfers, but unlike Bitcoin, Ethereum was developed to be a primarily legitimate currency, to be used by vendors worldwide. Akin to most cryptocurrencies it is traded on the USD, meaning that if you want to convert ETH to CAD, it must be first converted to USD.
What makes Ethereum so special, is it’s capacity to use scripts, making it easy for vendors to automate transfers, payments, and sales. However, this system is not perfect, as evidenced on November 7, 2017, when a single user’s script accidentally caused a sum of USD 180 million to be frozen.
In this article, we look at how to buy Ethereum in Canada and mention several of the exchanges you can use.
How Ethereum can be Bought
Ethereum is commonly bought through brokers on public exchanges. These brokers are private users, like yourself, who purchase and stockpile Ethereum, then sell it online or in a physical location. However, since there is no way to guarantee that the broker will be honest with you and since transactions are irreversible, you should never trust a private broker who is unwilling to meet you in person or insists on a private transaction online.
Ethereum is no insurable, and police in Canada are not equipped to handle financial crimes relating to Ethereum. A trustworthy broker may have a private site, but they will always use a public exchange for transactions. Therefore, it is important that you research both the broker and the exchange that they use. No matter how legitimate a broker is, if they use a shady exchange, both you and the broker stand to lose everything.
Coinsquare is a popular Canadian cryptocurrency exchange platform which also trades in precious metals. Despite being traded against the USD, the Ethereum price is shown in CAD, and Coinsquare charges a nominal fee to cover both the transaction and conversion. This makes Ethereum to CAD sales streamlined and easy to use for both beginners and experts.
Coinsquare holds 95% of their cryptocurrency assets in cold storage, which goes a long way towards preventing unauthorized transactions, or accidental loss. However, it should be kept in mind that Coinsquare is a centralized exchange, for a decentralized currency.
Quadrigra is another Canadian cryptocurrency exchange platform, based out of Vancouver, BC. For the advanced users, they offer a trading API, though it is easily accessible by beginners as well. Quadriga features same day deposit and withdrawals which can be traded in CAD. They even take deposits and withdrawals through interact e-transfer.
New exchanges are popping up all the time, but it is the trader’s responsibility to research them. Since cryptocurrencies such as Ethereum are not insurable and unregulated, all risk of a failed transaction falls on your shoulders. Though some exchanges offer protection, they are not obligated to provide them. However, legitimate exchanges platforms are built on trust, and without earning the trust of their users, they could not operate.
Peer to Peer
While technically all Ethereum purchases are peer to peer, in person trades and transactions are quite popular. This is especially true because of Ethereum’s script ability, which makes it possible for businesses to use Ethereum for purchase of goods like coffee, or services like home repairs. The problem with this is that Ethereum is highly volatile. A cup of coffee could cost twice as much today as tomorrow, yet four times as much the day after. While Ethereum friendly vendors are often transparent with what you get, they usually charge above or below trading price – in their favour, and if you wish to use Ethereum at their store, you have no choice but to take the hit. In the future, this may change, but for now, it’s buyer beware.
West Edmonton mall recently installed Bitcoin ATMs, which have proven to be in high demand. However, it was not until August 2017, that the first Ethereum ATM was publicly available in Toronto, Canada. These ATMs are now available in 11 locations throughout Ontario and are expected to spread across Canada as popularity grows.
Ethereum ATMs support both Bitcoin and Ethereum, but you need both a Bitcoin Wallet and an Ethereum Wallet. Furthermore, they only trade to Canadians, not to each other. While this may be limiting to some, their convenience makes it ideal to buy Ethereum without using an exchange, or to sell it for CAD, to ensure a vendor does not take advantage of you.
However, Ethereum ATMs are fee heavy, and they promote a laziness in users that could lead to you allowing your Ethereum wallet to be compromised. Like any cryptocurrency, it is essential that you keep your private wallet hidden from the world, despite the convenience ATMs provide.
A Final Thought on Bitcoin
Ethereum is a relatively new currency, and as such it fluctuates more volatility than others, such as Bitcoin. Though its scripting engine makes Ethereum more powerful than Bitcoin and easier for vendors and users to use for daily purchases or automated transactions, that same engine allows for it to be exploited. If a single user could accidentally cause upwards of USD 180 million to be frozen, it bags the question of what damage one or more malicious users could do intentionally. Since it is unregulated, Ethereum is a high-risk investment.
Ethereum has the potential to outgrow Bitcoin in both daily use and value. Ethereum does not have the sordid past of Bitcoin, meaning that while it will take longer for the cryptocurrency’s value to rise, investors have peace of mind in knowing that their money is not funding drug empires. With more countries and their financial institutions beginning to pay attention to the world of cryptocurrencies, it is safe to say that a few years from now, the value of Ethereum will surpass its present one.