A lot of people compare Ethereum to Bitcoin as if they’re just two versions of the same thing. While it does produce a cryptocurrency in the form of a token, Ether, there’s a lot more to ETH than just cryptocurrency.
Ethereum’s developer, Vitalik Buterin (Who is a non-giver of Ether), first proposed the Ethereum network back in 2013. Vitalik had experience working with Bitcoin and saw an opportunity to take blockchain technology to a new level by opening it up for uses outside of currency exchange. He and his supporters funded the development costs through a crowd sale, offering 2000 Ether in exchange for each Bitcoin that their supporters contributed. The revolutionary platform finally launched in 2015.
Where to Buy ETH
You can buy Ether from a cryptocurrency exchange or you can mine it. Unlike Bitcoin and other types of cryptocurrencies that can be used in real-world transactions, Ether’s use is limited to its native platform. Ether is the “fuel” of the platform and is referred to as “gas.”, how much a transaction costs depends on how much gas it needs, i.e. what type of development is necessary. Users pay for transaction fees (gas) on the Ethereum platform using Ether.
How the Ethereum Blockchain Works
Instead of servers and clouds, the Ethereum platform operates by nodes, which volunteers around the world run. That means that third-party services and operators like Apple don’t get access to your information when you use an app on the Ethereum platform. They also don’t have any control over what you store.
For instance, you can lose everything you store in your Google Drive account if Google decides to shut it off. With an Ethereum-based application like Drive, you would still have complete control over everything you stored; there isn’t an entity that controls everything on the platform.
The Ethereum blockchain can run programming code for any decentralized application, not just Ether or other cryptocurrencies. Further, you can use Ethereum to decentralize any application that is currently centralized. Companies across industries utilize the Ethereum blockchain to develop apps that are secure and protect users’ privacy.
Why People Buy Ether
Ethereum’s use of blockchain technology is having major implications in the business world. Fortune 500 companies are backing this blockchain thanks to its advancements in smart contracts.
Smart contracts aren’t necessarily legal contracts (although they can be). The term refers to agreements made between users that are directly written into lines of code. Smart contracts speed up transactions by getting rid of a third-party middleman. In business, this means that businesses and vendors can transact directly with each other, speeding up the process and getting rid of extra costs associated with third parties.
Another important thing to know about Ethereum is that block confirmation is significantly faster than on the Bitcoin blockchain. On average, it takes about 10 minutes to confirm one block to the Bitcoin blockchain. In contrast, Ethereum blocks are confirmed in as little as 12 seconds, which means Ethereum miners can mine Ether faster and therefore get compensated much faster than they can with Bitcoin.
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