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Ethereum is deemed one of the market’s most popular cryptocurrencies, yet it is vital to recognize that it is a lot more than just a cryptocurrency.
Ethereum runs smart contracts on a decentralized platform. If that sounds a bit perplexing, don’t panic. We are going to explain everything you need to know in this comprehensive guide.
Below, we will tell you everything you need to know about Ethereum, including what it is, whether Ether is a good investment opportunity, and how Ethereum is more than a cryptocurrency.
Needless to say, it is vital to remember that everyone has a different investment profile. Therefore, it is critical to think about what is going to make the most sense for your situation and fits in with your objectives.
Keeping that in mind, we are going to take a look at everything you should understand about Ethereum in this guide.
Ether (ETH) is the Ethereum cryptocurrency. However, Ethereum itself is a blockchain platform. It also has its own programming language, which we refer to as Solidity.
When referring to Ethereum as a blockchain network, it is a decentralized public ledger that involves the registration and verification of transactions. Any user on the network has the ability to create, public, use, and make money from applications on this platform. They can also use Ether for payments.
When using the network, the term dApps refers to the decentralized applications on the network.
Ethereum was founded by a number of programmers and entrepreneurs. However, a lot of the credit goes to both Vitalik Buterin and Gavin Wood. Nevertheless, this does not mean they are in control of Ethereum. That is a completely different matter. No one person or entity is in control of the platform because the network is decentralized.
We mentioned the term “smart contracts” in the introduction. A smart contract is merely a term that describes a computer code for facilitating the exchange of content, property, shares, money, or anything else that has value.
When you work on the blockchain, a smart contract is a computer program that is self-operating and will perform automatically when certain boxes are ticked.
As smart contracts run on the blockchain, they will run as programmed without there being any possibility of censorship, downtime, fraud, or third-party interference.
While every blockchain has the ability to process code, a lot of them have many different limitations. This is not the case with Ethereum. With Ethereum, you can generate any sort of operation you wish.
As a consequence, thousands of different applications can be created by developers, which way extend anything we have witnessed before.
There are plenty of benefits to reap by making an investment in Ether. This includes the following:
This is a question a lot of people ask. When deciding between the two cryptocurrencies, your own risk profile is going to be the main deciding factor. There is no one solution that is better than the other; it is all about determining what is right for you.
As the world becomes more digital and more people accept cryptocurrency, both have bull catalysts in the near future. Bitcoin may be the more mainstream of the two, but Ethereum is growing rapidly. You can buy ETH on Moonpay with ease.
It is possible that there could be higher rewards because of the higher risks linked with Ethereum. In any case, it is not 2009 now, so we have exceeded the proof-of-concept period.
Ethereum is certainly unique when it comes to the world of cryptocurrency. This is because it is a software platform with numerous purposes, and outside developers are invited to develop their own applications.
Many entrepreneurs have used the Ethereum platform so that they can launch their own cryptocurrencies.
People often think that Ethereum refers to the currency. However, the term ‘Ethereum’ refers to the network. The currency is known as Ether. People trade Ether. They do not technically trade Ethereum. So, if someone speaks to you about the price of Ethereum, they are really going to be referring to the price of Ether.
From the start, Buterin had a vision for his network to start a fresh area of decentralized apps, spanning many types of industries. Considering that, we will take a brief look at some of the different things Ethereum is being utilized for.
We don’t all like the thought of Facebook and other media giants storing our personal data. Some developers are currently working on various ways for data to be housed on the blockchain so that it can be kept safer in comparison to being in the hands of these for-profit enterprises.
In this manner, you could be in charge of what you wish to be revealed about yourself depending on the circumstances. For instance, you can choose what to reveal during a job interview, and then after the application, you can shield all of your data once more.
Waiting to be paid is one of the biggest struggles when making an insurance claim. However, decentralized insurance could eliminate this issue.
For instance, Etherisc will pay policyowners straight away if winds hit above a set speed within a 30-mile radius of their domestic or commercial property.
There are three chief agencies in the US when it comes to credit history reporting; Experian, Equifax, and TransUnion. A huge amount of data is handled by all three, to the extent that mistakes can often happen.
To make the situation frustrating, getting rid of mistakes on your credit report is not easy. While you navigate this, your credit rating will dip, and this means you will either receive loan offers with unfavorable rates or you will be denied altogether.
A decentralized lender will not rely on the credit reports produced by large third-party corporations. Instead, you can use collateral in the form of cryptocurrency. This means you enjoy more flexibility and an easier application process.
A good example here is Cent, which is a social network that has made it possible for fans to offer monetary support to their favorite content creators via cryptocurrency.
Augur is a protocol that can be used by developers for the purpose of creating a prediction market whereby players can make money by accurately predicting events.
Augur ensures it is protected from fraud by generating numerous reports on the outcome of a predicted event, rather than only relying on one report. In this way, it is just like a centralized prediction market.
There are no limits on the bets that you can place on Augur, nor are there any limits in terms of the money you can win.
If you find yourself on a hot streak, you can keep going. Augur won’t step in and prevent you from betting more, which can often happen with traditional bookmakers. Plus, Augur will not take any percentage of the funds you do generate.
On a final note, we must talk about crowdfunding. Generating startup capital for new enterprises is one of the main uses for Ethereum. Companies generate new digital currencies, which we call tokens, and they can be offered on the Ethereum network.
Speculators tend to be quite willing to take a chance on a fresh currency by purchasing the new token at the ICO, otherwise known as the initial coin offering.
In fact, this is how money was generated by Ethereum in the early days with Ether. Since then, plenty of other tokens have enjoyed crowdfunding success on Ethereum. This includes the Augur platform, which brought in $5.3 million, as well as Golem, which has accumulated $8.6 million.
Hopefully, you now have a better understanding on Ethereum and the benefits associated with this platform.
From crowdfunding to better insurance products, the number of uses for Ethereum is truly extensive, and growing all of the time.
Of course, you can also invest in the Ether currency if you are looking to get involved in a thriving part of the cryptocurrency domain.