Ethereum is a cryptocurrency like that of Bitcoin that has seen massive gains in the last year. In fact, ethereum is the 3rd largest cryptocurrency in terms of market value. The ethereum platform is of the blockchain variety which is called Ether. Ethereum uses blockchain technology on an open source to create and operate digital applications. The ability to leave banks out of transferring money can save and provide needed personal privacy.
Ethereum runs on a network of computers around the world and works together. The network runs smart contracts and apps that are free from censorship. Smart contracts greatly decrease the likelihood of fraud and self-execution. Conditions need to have proof that the conditions have been met. The data of the transaction is not stored on a central warehouse like Google and Facebook do. The data is then more secure than on these platforms.
What to Know About Ether
Ether was created by Ethereum to reward programmers to run ethereum protocol on their devices. The programmers are compensated with Ether coins much like Bitcoin miners were rewarded in the past. Writing health applications for Ether is also another way to earn ethereum as compensation. January 10th saw a high of over $1,400 a coin which is a huge increase from when they debuted costing 40 cents.
Why It Was Founded
Ethereum’s founder was 19-year-old Vitalik Buterin who wanted to use the technology that powered Bitcoin’s currency to help democratize currencies, businesses, and organizations. Central banks can be manipulated while cryptocurrency cannot be manipulated by any political organizations. Certain governments have banned the use of Bitcoin due to its ability to give citizens true power. Buterin released a whitepaper in 2013 which outlined his vision for ethereum. He actually won the prestigious Thiel Fellowship with a $100,000 prize. Ethereum then raised $18 million that at the time was the most successful of all-time.
How Does It Work?
Ethereum is based on blockchain technology much like that of Bitcoin. Ethereum possesses a series of cryptographic and secure records that are tough to change as there are time stamps with user data. On the ledger, the user can create a contract keep debt without using an external recordkeeper like a trust officer. These are often referred to as trustless contracts which can be immensely helpful when selling items online. The contract is self-fulfilling so little to no trust is required to make sure you are not getting scammed.
Ethereum does have its challenges even though they have built an amazing platform in Ether. The speed and storage is a huge problem due to the immense size and scope of ethereum. Only a few transactions can be made per second which is far less than hundreds that other platforms allow users to make.
Cryptocurrency has changed the way that a number of people around the world view money. These investments can be volatile so keep this in mind and do your due diligence before investing. Crypto is here to stay, and it is time for the common consumer to learn about their investing options.
