Ethereum (ETH) Review And Stats
Ethereum (ETH) is a crypto coin that can be traded in the crypto markets.
Ethereum History And Background
If you’ve already heard of Bitcoin, then it is likely that you’ve also heard of Ethereum. Ethereum is an online platform where a cryptocurrency called ether is used and exchanged.
A cryptocurrency is a digital currency much like the conventional currency. The main difference is that even if it’s online, it is independent of all nations and banks. This means that there is no government or institution that controls it. Cryptocurrency also doesn’t have a physical form. There are no banknotes and coins, but they function in the same way as money and you can convert them to actual currency, too.
Cryptocurrency makes use of a digital ledger which is called a blockchain. It is called so because transactions are recorded in blocks once they are validated by a number of computers. The computers that validate transactions are called miners and as a reward for their job, they are given a kind of cryptocurrency depending on where they are mining. If they are mining in ethereum, then they get ether.
One major difference of ethereum as opposed to bitcoin is that the latter is only used for transactions. It is only a payment method as compared to ethereum which allows smart contracts. A smart contract, taken from its name, is a virtual contract that can facilitate transactions on its own. It is usually in the form of “if-then” statements that get executed once a condition is met.
It prevents the addition of a third-party in transactions
Because ethereum makes use of smart contracts that execute on its own, there is almost no need for a third-party. The waiting time is also shorter because you don’t have to fill out forms, wait for offices to open, and set up appointments with people involved.
It is not just a currency, but a platform
A platform is much more versatile than any currency. Since ethereum is a platform, other services are offered aside from money exchanges and transactions.
Double spending and illegally duplicating money is avoided
This is actually one of the advantages of blockchain and cryptocurrencies in general. When ether is produced, there is a digital signature that accompanies it. It is similar to a unique name used to identify ether currency. When a transaction is made, miners verify the ether exchanged making sure that they were not used before. This also checks for fraudulent money.
Ethereum receives a lot of support from both businesses and developers
You can attribute this to ethereum being a platform. Because it is more versatile to have, more developers are trying to improve the system. You can expect continuous improvement and increase in its capacity in the next few years.
Being a platform can also be a disadvantage
Compared to bitcoin which is only a kind of cryptocurrency, ethereum is a whole system on its own. This means that it faces more complex problems. It also has more capabilities lined up for it and if the architecture of the whole system is not done well, it can lead to a massive crash.
Bugs in smart contracts can be doors for “illegal” transactions
Bugs won’t stop automated smart contracts from working. This could end up to illegal actions being circumvented because contracts allow for its execution. A classic example was when The DAO (Decentralized Autonomous Organization) had a bug in their contract and this allowed one of their employees to transfer the money to another account. According to the employee, it wasn’t exactly illegal because the contract was still done.
There is limited material to learn about ethereum
Unlike other topics and programs where textbooks and online tutorials are abundant, ethereum has very limited guides. If you look at the web, there are only a few tutorials that will teach you how to become an ethereum developer and even those tutorials only go so far as the basic knowledge.
Where To Trade Ethereum
Ethereum can be trdaed in the following exchanges: