Have you been looking for an excellent alternative to Bitcoin? Have you heard about Ethereum and want to learn more?
Enter: Ethereum. Ethereum isn't strictly a cryptocurrency in the conventional sense, but it is powered by one - called Ether. Ethereum is something more ambitious. It features smart contract scripting and is a public blockchain network.
Ether is also different from Bitcoin as it isn't designed simply to be a unit of currency. It is also intended to be a way of powering the Ethereum network through compensating miners who perform computations.
I will go into how Ether and the Ethereum network functions later in this article, as well as the differences between Ethereum and Bitcoin. But first, let's run through some of the basics.
Ethereum is a relatively new platform and has been available to the public since 2015.
It all began in 2013, when a cryptocurrency programmer and researcher called Vitalik Buterin came up with the concept of Ethereum. He issued a whitepaper which outlined the rationale and technical design.
The following year, development was crowdfunded online, leading to Ethereum's launch on 30 July 2015 when 72 million coins were created.
In 2016, Ethereum was split into separate blockchains, Ethereum (ETH) and Ethereum Classic (ETC). It was undertaken to reverse a theft of over $50 million of Ether. It also fixed the flaws in the system.
It has seen tremendous growth, and 2017 was the big breakthrough year. In that one calendar year, the value of Ether grew by over 15,000%. It increased in price from $8.24 to over $1,314.
There were several other landmarks for Ethereum in 2017. Russia endorsed it, and Ether trading was added to the eToro and AVATrade platforms. There was also a dramatic rise in companies using Smart Contracts to create tokens.
These were all significant factors that led to the enormous growth experienced by Ether. Ethereum was designed with fantastic functionality. It is a decentralized software platform. It smoothly functions and is highly secure.
As I alluded to earlier, Ether and Ethereum are linked, but not the same thing. Ether functions in a similar way to other cryptocurrencies such as Bitcoin, whereas Ethereum is a decentralized network with practically unlimited applications.
Here are some examples of how it can be used:
In this section, I will look through the pros and cons of Ethereum to give you a better understanding of whether you should begin investing in Ether or Ethereum.
A deeper comprehension of the advantages and disadvantages of the Ethereum project will help investors make the right decisions about investments in related projects.
It is a fact that for blockchain enthusiasts, the Ethereum blockchain is popular with many Decentralized Application or dAPPs developers.
Its fame is due to its ability to be used in a wide array of cases. Its cryptocurrency, Ether, has had a somewhat turbulent time with its value against the US dollar rising and falling rapidly.
Still, the fact that Ethereum makes Blockchain accessible to various types of developers and businesses means it has maintained its reputation for being useful.
There are many pros to Ethereum, which include:
There are some persuasive positives for Ethereum, so to balance out views, let's take a look at the cons. These include:
So there are pros and cons, but in my opinion, the advantages are more substantial, and the future of Ethereum is bright. With the right research and planning, it remains a viable investment option.
Perhaps the most comfortable option to buy and sell Ethereum is through a cryptocurrency exchange such as xcoins.com. Such exchanges make it possible to buy Ethereum in a matter of minutes securely. Payment via Visa or MasterCard makes the process straightforward.
As previously mentioned, you can go the easier cryptocurrency exchange route, or you can use a somewhat indirect method like PayPal.
If you choose to buy Ether from an exchange, it is similar to buying something in a store. You give your credit card details and get your item in return. (The only difference is that you will receive Ether tokens instead of a new frying pan.)
You should be careful not to leave your Ether tokens at the exchange and immediately transfer them to your online storage wallet for safekeeping. Don't worry; we'll discuss the best wallet options a little later in this article - although the process of buying Ether is quite straightforward. You find an acceptable exchange, open an account, deposit your funds, exchange the funds that you collected, and then withdraw your Ether tokens to your wallet. Easy!
There are a few different things to look for when considering an Ethereum exchange. You can start by asking the following questions:
There are several other exchanges with a good reputation to look at. These include Coinbase, Bitpanda, and Cex.io. They all have their pros and cons and are suitable in different ways.
Ethereum trading platforms such as eToro, Bitstamp, and Nuance are other options. They offer additional services such as brokerage, which may be a straightforward option for a beginner.
There are also Ethereum P2P exchanges. LocalEthereum is a famous example of this. Buyers and sellers meet online, and it enables a broad range of payment options.
There is often a conflict of systems when buying Cryptocurrencies using PayPal. Ethereum is not widely available using PayPal, but there are some workarounds available to the consumer.
One option is to buy Bitcoin using a platform such as Virwox, which accepts PayPal as a payment method. You can then easily convert your Bitcoin into Ethereum.
You can also buy Ethereum directly to an individual on a platform such as LocalEthereum and pay your seller via PayPal.
These are not perfect options, but they will work if that is the only payment option available to you.
The methods for selling your Ethereum are similar to buying. You can use the same exchanges to make easy sales. It is worth your while reading through each option online to choose the method which suits you best.
It is vital to choose the best Ethereum wallet for your needs. The most reliable wallets provide a combination of both ease of use and proper security.
Your Ethereum wallet can be either a hardware device, an online website or app, or a simple piece of paper with your code printed onto it.
Hardware wallets include Trezor, Ledger Nano X, and KeepKey. You need to pay for these devices, and they are physical wallets in which you will be able to store your Ether in an encrypted form. You can store them in a physically safe space.
These are the safest options as they store your investment offline and never expose your data on the internet.
They are also the best choice available for more serious investors of cryptocurrencies.
Accessible online and web wallets include Coinbase, Exodus Wallet, myEther wallet, and Jaxx wallet.
These are all convenient to use and enable you to store your Ethereum investments securely online. The only downside is that there is a small risk of having your information exposed to hackers. Generally speaking, however, these wallets are a safe bet when it comes to storing smaller amounts online.
The last option is to use a paper wallet.
These are incredibly secure as they are similar to hardware wallets, and they don't leave your sensitive data online where it could be susceptible to hackers.
They store your Ether addresses on paper, rather than buying hardware. The only downside is the risk of losing the piece of paper (make backups!).
ETHadress is a paper wallet. It is an open-source option, and it is the cheapest option to create cold storage for your Ether.
You can learn some more general information about Crypto wallets by looking here.
Bitcoins and Ether are two of the most reliable cryptocurrencies to invest in today. They are similar in some ways, and you will have to study the current market conditions to decide which shows more promise for investment in the current climate.
However, there are a few simple reasons to consider buying Ether over Bitcoins. These are:
There are many powerful backers of Ethereum in the business community, who will continually have input to make it a reliable option.
Ethereum has come a long way in a short amount of time. Like all cryptocurrencies, there have been turbulent periods of great highs and lows.
It is, however, built upon a strong foundation with an excellent long-term strategy for surviving and growing. It makes for an exciting alternative to Bitcoin when it comes to choosing cryptocurrency investments.
It has an extremely adaptable Blockchain, which is used for a wide variety of practical solutions. There has even been a Reddit user who created a new token inspired by the Coronavirus. It is an ERC-20 token based on the Ethereum Blockchain called the Coronacoin.
Part of the funds raised will be donated to the Red Cross to help them fight the worldwide pandemic. It illustrates how adaptable the Blockchain and token system can be.
Ethereum price is predicted to rise as high as US$844 to US$11,375 by 2025.
While it is not clear exactly what effect the global pandemic of COVID-19 will ultimately have on cryptocurrencies, most experts expect a steady rise in the value of Ethereum in the coming years.