Buying and storing ethereum.

Bitcoin is primarily a ledger for transferring value. Ethereum adds a programmable layer on top: smart contracts, which power decentralised applications, stablecoins and other tokens. Ether is the fuel (gas) that pays for every transaction and contract on that network.

Since 'the Merge' in 2022, Ethereum runs on proof-of-stake rather than proof-of-work: validators lock up ether instead of providing computing power, which also means held ether can generate staking yield if you choose to stake.

The purchase process mirrors bitcoin: a MiCA-licensed provider, KYC identification, a deposit via SEPA or local payment methods, and a purchase at a rate with a built-in margin.

With ethereum, there is an added question of whether you plan to stake. Some providers offer staking directly as part of the purchase, for a commission and with the platform as intermediary — see the staking guide for the trade-off between staking yourself, outsourcing it and the tax consequences.

Ether can be stored in the same types of wallets as bitcoin, but the Ethereum ecosystem also includes 'layer 2' networks (such as Arbitrum or Base) that make transactions cheaper by settling them in bundles on the main chain. Know which network your coins are on before sending them: an address is not automatically compatible across networks.

Gas fees on the Ethereum mainnet can rise sharply during busy periods. Anyone self-custodying and actively transacting should factor that into their planning.

In Belgium, a gain on ether is assessed the same way as bitcoin: normal management of private assets usually stays untaxed unless the pattern turns speculative or professional. Staking income is often assessed separately and can more readily be treated as miscellaneous or professional income than a sale gain.

In the Netherlands, ether counts toward box 3 at its value on 1 January, like bitcoin. Received staking rewards also increase wealth at the moment received, which can affect the reference-date value.

Sending coins to an address on the wrong network is one of the most common and most irreversible mistakes with ethereum. A second is entering staking without understanding the exit queue and notice period. A third is not tracking staking receipts separately for tax purposes, even though they are usually assessed separately from sale gains.