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ETH Beginner Guide: Pros and Cons of buying ETH

The market cap of ETH comes second in the world, and it is the second-largest cryptocurrency by volume, which is just behind Bitcoin. Even if you don’t follow the financial world closely, you are likely to be aware that cryptocurrencies have become one of its biggest stories recently.


However, the price of crypto can fluctuate a lot, which can be concerning to many investors. This article will detail what ETH is and compare it with Bitcoin. Moreover, it will also cover the trend of ETH, its key features and its risks.

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Getting to know ETH (Ethereum)

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What is Ethereum (ETH)?

Ethereum, which is the specific blockchain technology, was invented by programmer Vitalik Buterin and it was first released in 2015. Ethereum’s native cryptocurrency is called Ether (ETH). 


Like other cryptos, Ethereum was built on the principles of decentralized finance. Ethereum embraces an open-source software platform which allows developers to create cryptocurrencies and other secured digital applications, which can be anything from lending apps to payment platforms and with the potential to do far more. This is the reason why some believe that it could one day shunt Bitcoin from the top cryptocurrency spot.


Over the past year, Ethereum has gained in popularity and it is adopted by both retail and institutional investors alike.

Best Crypto Exchange

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HashKey Exchange

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Up to 0.29%
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Futu Securities Account

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Trading Fee
HK$0
Custody Fee
HK$0
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HK$10,000

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OSL is a licensed (SFC Type 1,4,7,9) cryptocurrency platform offering dedicated Ethereum (ETH) trading services. The platform's "Quick Trade" feature enables zero-fee transactions (compared to 0.1%~0.3% on other exchanges), supported by cold storage custody and $1 billion insurance protection.
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Webull Securities Account

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Min. Commission Fee US Stocks
US$0.99
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ETH vs BTC: What’s the difference between Ethereum and Bitcoin?

ETH vs BTCETHBitcoin (BTC)
ETH vs BTCPriceETHUS$2,736.62 (As of 5 May 2022)Bitcoin (BTC)US$2,736.62 (As of 5 May 2022)
ETH vs BTCSupply ETHUnlimited Bitcoin (BTC)21M
ETH vs BTCUnitsETH1ETH=10^18 WeiBitcoin (BTC)1BTC=10^8 Satoshi

Key Features of ETH

ETH has an Infinite Supply

Unlike Bitcoin, ETH offers an unlimited supply. Bitcoin's supply cap is limited, standing at 21 million, meaning that once this limit is reached, there won’t be any additional Bitcoins available to mine, making it a precious but finite resource.
However, ETH doesn’t work in this way. It can never run out and its prices are not supported by the cap but its digital applications and its market value.

Ethereum Can be Used Widely

Ethereum can be used to create digital apps e.g. NFT. Think of Ether as the crypto token derived from the Ethereum blockchain, which allows encrypted data to be transferred securely, which makes it next to impossible to counterfeit. Moreover, Ethereum-based apps are built using its key innovation: “smart contracts”, which is just like regular paper contracts, which can establish the terms of an arrangement between parties.

ETH Price Has Been in a General Upward Trend

The market cap of ETH comes second and it is also the second-largest cryptocurrency by volume, which is just behind Bitcoin. Moreover, in the last 3 years, its price has increased by more than 1500%, and is purchased by both retail and institutional investors. But it also comes with risks.
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Step-by-Step Guide to Buy Ethereum in Hong Kong

Once you’re comfortable with the basics of Ethereum, the next step is making your first purchase in Hong Kong safely. This section guides you through each stage, from choosing a licensed exchange to securing your coins and avoiding common pitfalls unique to the local market.
Step 1

Choose an SFC-licensed exchange

Start by selecting from SFC-licensed crypto exchanges operating in Hong Kong. This helps you avoid unlicensed exchange risks and ensures the platform adheres to local regulations.
Step 2

Create your account and begin KYC for Hong Kong crypto

Register using your HKID and follow each step to meet KYC requirements specific to Hong Kong crypto rules. Double-check your info to prevent delays or lockouts.
Step 3

Link a local payment method

Add and verify one of the accepted cryptocurrency payment methods in HK, such as FPS, PayMe, Octopus, local bank transfer, or a Hong Kong-issued credit card. Note that some methods may have funding delays during holidays.
Step 4

Deposit funds to your account

Transfer HK$ to your exchange account after confirming the correct recipient details. Monitor your deposit status, especially during peak times or public holidays.
Step 5

Buy ETH on the exchange

Using the platform’s interface, select Ethereum (ETH), enter your purchase amount, and confirm the transaction. Review all details before finalising.
Step 6

Withdraw ETH to your crypto wallet

Move your ETH off the exchange and into your crypto wallet for added safety. Always double-check wallet addresses before sending.
Step 7

Follow crypto wallet safety tips

Secure your recovery phrase, enable two-factor authentication, and never share your private keys. Keeping your wallet details private protects your assets.
Step 8

Know the risks: unlicensed exchange risks & common pitfalls

Avoid unlicensed exchange risks by checking SFC registration before funding. Beware of incomplete KYC or using unsupported payment methods, as these can halt your transaction.

Why Buy Ethereum in Hong Kong?

Many of us may wonder what makes ETH worth the effort. The short answer is that Hong Kong’s clear regulations, efficient banking links, and investor-friendly tax policies make ETH trading smoother than in most markets.

Regulated local exchanges mean safer ETH trading

Platforms like HashKey Exchange and OSL Digital Securities operate under strict licensing rules, offering fund segregation, insurance, and strong data protection.

Direct HK$ deposits and fast withdrawals

OSL and Tiger Brokers support FPS and bank transfers, while Futu Securities allows smooth eDDA bank connections.

No capital gains tax for most retail ETH investors

Hong Kong’s tax structure favours crypto holders. Most individuals don’t pay capital gains tax on ETH investments.

DeFi, NFTs, and Web3 opportunities

Many Hong Kong users explore DeFi and NFT platforms safely through licensed ETH holdings.

Multi-asset access for diversified investors

Futu Securities, Interactive Brokers (IBKR), and Tiger Brokers let investors view ETH alongside traditional assets in one dashboard.

How to Sell Ethereum & Withdraw ETH

Step 1

Pick a licensed exchange

Choose HashKey, OSL, or Futu/Tiger Brokers for secure HKD withdrawals.
Step 2

Verify your account

Match HKID with bank details to avoid rejection.
Step 3

Transfer ETH

Use the correct ERC-20 network.
Step 4

Sell ETH for HKD

Use market or limit orders.
Step 5

Withdraw via FPS or Bank Transfer

FPS is instant; bank transfers take up to three days.
Step 6

Confirm receipt

Keep transaction IDs until cleared.

Risks of Investing in ETH

The Price of ETH Can be Volatile

Although the price of ETH has been rising by more than 1500% from 2019 to 2022, it actually experienced quite a significant drop, from US$100 to US$1300 in 2018. Like other crypto currencies, its price can fluctuate a lot, which can be very concerning for risk-averse investors. You may have concerns about the rapid changes in the market.

Ethereum May Not be Widely Used Anymore

Ethereum can be used widely and ETH has been rising because of the popularity Ethereum has gained. However, if Ethereum is not widely used anymore, the price of ETH will dip.

Security Issue

Different from traditional currencies, ETH exists in digital form and stored in a digital wallet. If you lose your private access key, you may end up losing your ETH forever.

Virtual Commodity - Not Considered as Legal Tender

ETH is not considered a legal tender, which is outside the regulatory ambit of the Hong Kong Monetary Authority. Therefore, if the crypto exchange goes bankrupt or shut, your access is not protected by the Hong Kong government.

Points to Note in Trading ETH

Using ETH for NFT events

NFT culture is expanding locally, and some exhibitions, meetups, and creator-led events now accept ETH as a payment method. Users should confirm wallet addresses directly with organizers to avoid phishing, understand gas fees that may affect final costs, and keep screenshots or transaction hashes for proof of purchase or dispute resolution.

Peer-to-peer ETH transfers

P2P ETH transfers are allowed for private, non-commercial purposes, but you should maintain clear transaction records such as wallet addresses, timestamps, and reasons for transfers. This helps demonstrate transparency if banks or authorities request clarification under AML requirements. Avoid handling funds on behalf of others, and never accept or send crypto for strangers, as this could unintentionally involve you in fraud or money-laundering investigations.

Exploring DeFi apps safely

Since the SFC does not regulate decentralized finance platforms, users must rely on their own due diligence before investing. Check whether the project has audits, a transparent development team, and a verifiable track record.

Staying safe and informed

Before engaging with any crypto-related offer, check the SFC’s alert list to identify unlicensed platforms or suspected scams. You can also review Consumer Council warnings for common fraud patterns affecting local users.
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How to Get Support When Crypto Goes Wrong

Step 1: Contact your crypto platform

Start with customer support; prepare screenshots and IDs.


Step 2: Escalate within the platform

Follow up using their formal complaint process.


Step 3: Approach the Consumer Council

They handle crypto-related service complaints.


Step 4: Contact the SFC or HKMA

The SFC manages trading issues; the HKMA oversees banking-related ones.


Step 5: Keep detailed records

Maintain logs and receipts for every interaction.


FAQ on investing in ETH

Is commission charged when purchasing ETH?

No, you are not charged commissions in most cases.

Does ETH have a supply limit?

No, it doesn’t have a cap.

What is the difference between ETH and BTC？

ETH doesn’t have a cap in supply but the cap of BTC stands at 21M. Also, the key feature of ETH is that it can be used in Ethereum - which can be seen as a platform for any digital applications.

What is Ethereum? Are Ethereum and ETH the same?

No, they are not the same. Ethereum is the specific blockchain technology, which allows developers to create any apps and Ethereum’s native cryptocurrency is called Ether (ETH).

Is Ethereum legal in Hong Kong?

Yes, through SFC-licensed exchanges, the SFC in Hong Kong enforces AML and investor-protection standards.

How can I buy ETH safely?

Use licensed exchanges; fund via FPS or bank transfer.

Do I pay tax on ETH profits?

The IRD doesn’t charge capital gains tax for passive holdings.

Is Ethereum part of CIES?

Yes, Hong Kong's CIES now accepts Bitcoin and Ethereum for investment immigration, with a net worth of HK$30 million required.

Are no-KYC platforms safe?

No, they’re unregulated and risky.

Who should I contact for complaints?

The Consumer Council, SFC, or HKMA handle crypto-related issues.

Term and Conditions

The content herein is provided for educational and informational purposes only and should not be construed as investment advice, a recommendation or solicitation to buy or sell any securities.


Investing involves risks, including but not limited to the loss of principal, changes in interest rates, tax complexities, market systemic risks, and industry-cycle risks. Dividends are not guaranteed, and past distributions or performance do not guarantee future results.


The author is not a registered or licensed institution under the Securities and Futures Commission (Hong Kong), and does not provide personalized investment advice of any kind. Before making any investment decision you should consult an independent professional adviser or a qualified licensed entity, and carefully assess whether any product is suitable in light of your own financial situation and investment objectives.