The cryptocurrency IOTA is characterized not least by the fact that no blockchain as we know it from Bitcoin or other digital currencies is used. Instead, IOTA uses a distributed ledger technology without blocks. The use of this Tangle technology is intended to virtually eliminate transaction costs (so that even microtransactions make economic sense) and also to ensure greater scalability than is the case with cryptocurrencies based on blockchain technology.
These approaches have also got the attention of investors and IOTA is, only just behind Monero, the eleventh largest cryptocurrency in terms of market capitalization. So there is good reason to ask on which platforms IOTA can be bought and/or traded.
Buying IOTA with Paypal on eToro
IOTA can be bought, for example, on eToro (sometimes you can still find it said that eToro only offers CFDs on cryptocurrencies, but this has not been correct for a long time now). Among the many payment methods offered on eToro is PayPal. For those who like using PayPal, the trading platform offers an easy and direct way to trade IOTA.
However, it is “only” trading with IOTA that is possible on eToro. This means that you cannot send the cryptocurrencies from eToro to another exchange or your own wallet. Nevertheless, eToro is an interesting platform for IOTA and other cryptocurrencies as you can automatically copy the transactions of the best traders there.
Buying IOTA with Paypal via Virwox
If you really want to use Paypal for buying IOTA, there is another -indirect- option, but we strongly discourage it, because it is inconvenient and expensive. For this method you first have to go to VirWoX, where you can buy Linden dollars (SLL) with PayPal after setting up an account. You can then exchange the Linden dollars for Bitcoin on VirWoX. This takes up a lot of money as you pay both PayPal fees and VirWox for buying SLL and exchanging them for Bitcoin. The Bitcoins must be sent to another exchange (for example Binance, see below) to finally change them into IOTA there. The next section explains how the whole process can be done in a better and cheaper way.
Buying IOTA through Coinbase and Binance
Another, and better, method than the one via Virwox is buying Bitcoin or Ethereum on Coinbase and using either of them in exchange for IOTA on Binance. On Binance, you can then continue trading with IOTA, send them to a different trading platform or to your own wallet (e.g. a safe hardware wallet).
Buy Bitcoin or Ethereum on Coinbase
Unlike eToro, Coinbase does not include PayPal as one of its payment methods. The cheapest option, at least for European users, is to transfer money to your Coinbase account and then trade with those funds. Coinbase is especially popular among newbies, as buying and trading with cryptocurrencies is very easy there. It is also possible (in contrast to eToro) to send your digital currencies to other exchanges. This is exactly the way we describe here to get IOTA. On Coinbase, you have to buy Bitcoin or Ethereum, because these are the currencies than can be changed into IOTA on Binance. More details about this in the next segment.
Exchanging Bitcoin or Ethereum for IOTA on Binance
On Binance, you can only trade cryptocurrencies for other cryptocurrencies, which means you cannot buy them there with fiat currency such as the euro or USD. Trading with the cryptocurrencies on Binance is possible even without verification through an identification document, limiting, however, withdrawals in this case to an equivalent of two Bitcoins daily. To create an account on Binance, you only need a valid email address. Once you have such an account, you can send cryptocurrencies there -for example the ones you bought on Coinbase.
IOTA is one of the cryptocurrencies that can be traded on Binance. You can trade both Bitcoin and Ethereum for IOTA on Binance. When logged into your account on Binance, choose Funds from the top bar and then continue with Deposits:
Next you have to choose the cryptocurrency you want to deposit (it is Bitcoin in the image below):
The BTC (Bitcoin) deposit address that you will find on that page, you have to enter on the exchange from which you are sending your Bitcoins to Binance (if you bought your Bitcoins on Coinbase it is of course there that you have to enter the Binance deposit address).
As soon as your Bitcoins have arrived on Binance, you can change them into IOTA. For this, choose the appropriate trading pair on Binance (BTC/IOTA) and complete the trade with the necessary details:
Buying IOTA directly on Bitpanda
There is now another option for buying IOTA directly. In June 2018, the Austrian crypto exchange Bitpanda added IOTA to its trading portfolio. For the time being, IOTA can only be bought and sold on Bitpanda. Most other cryptocurrencies can also be transferred from Bitpanda to other exchanges and they are working on making this possible for IOTA in the near future. You cannot buy IOTA (or any other asset on sale there) on Bitpanda with Paypal, but they nonetheless offer a wide range of payment methods: bank transfers, credit cards, Giropay, Skrill and Neteller.
Should I buy IOTA?
As is true for cryptocurrencies in general, with respect to IOTA, too, you should be aware of significant price volatility. Losses are just as possible as the profits investors hope for.
Nevertheless, IOTA has many arguments in favour of investing in the cryptocurrency on its side. This includes not least the focus on the Internet of Things (and specifically on transactions between devices), which is certain to grow rapidly in coming years. This has already led to a considerable level of success in the form of cooperations with well-known companies. One example for this is Bosch, with the company having both invested in the cryptocurrency and working together with the IOTA foundation.
The use of distributed ledger technology as an alternative to the traditional blockchain used by other cryptocurrencies – and the advantages associated with the technology – further strengthen IOTA’s position, particularly with regard to diversifying one’s portfolio of digital currencies. At the same time, there is a risk if this technology should prove vulnerable. And this has already happened in the past and the IOTA team was forced to react to the weaknesses that had been identified.
To sum up, the potential of IOTA is undeniable, but this does not relieve potential investors from the need to keep an eye on current developments, including negative ones.