Investing in cryptocurrencies is thought to give you a rollercoaster ride, the reason being the fluctuation in its value. Ethereum is ranked as the 2nd largest cryptocurrency after Bitcoin, because of the market cap it has after the bitcoin. People’s second choice after Bitcoin is probably Ethereum.
Cryptocurrency started in the year 2009 after the economic crisis was globally faced. Although Ethereum joined much later to the race (i.e., 2013) of cryptocurrency even then it has become too popular.
Its founder Vitalik Buterin, who previously worked for bitcoin magazine, designed it in such a way to make it better than Bitcoin. Buterin’s work experience in bitcoin probably helped him to make Ethereum better and he vanished all the flaws that bitcoin has.
There is no doubt that his intellect in forming this currency has resulted in giving the investors 100% returns. That is another reason why people started believing and investing in this currency. Though it is just like other cryptocurrencies we have in the digital market, some features make it a better cryptocurrency.
Before investing in bitcoin, you can read about why bitcoin is going up.
ITS FEATURES AS A CRYPTOCURRENCY:
- One of the most spoken features is that it allows smart contracts.
- Its website Ethereum.org allows everyone to trade which means it is an open platform.
- It has its blockchain technology, its block time is 15 seconds per transaction.
- It enables a distributed computing system which means that it has no central control.
Disparities with bitcoin
IT IS FASTER
Block time denotes the time taken to produce a new coin. In Ethereum to mine a block takes around 15 seconds, in bitcoin, it takes around 10 minutes. With quick mining the blockchain data confirms the transaction in much less time, as a result, more transactions can be done.
In Ethereum transaction fee is based on storage needs and network usage, whereas in bitcoin it is based on block size which means the fees in Ethereum are less than bitcoin.
In Ethereum not only currency but the third-party application is also allowed to run in a network whereas in bitcoin only currency is allowed to run in a network. Ethereum’s blockchain can be a base for other apps.
In comparison with bitcoin, Ethereum miners earn more profits. This is possible because of the block size and block time. As we know more Ethereum coins can be mined in less time than bitcoin, that is why it makes it possible for its miners to accrue more profits.
Smart contracts can be implemented themselves. There is no third party that is needed for the execution of such contracts. In normal contracts, if there is a failure on the part of the other party you need some other powerful party who can execute it for you. That is how smart contracts make it more transparent, decentralized with no excessive fee payments, etc.
What makes it a 2nd generation cryptocurrency?
Ethereum is called 2nd generation crypto because it is more advanced. It not only allows decentralized currency circulation in the market but also serves many other purposes such as decentralizing apps and services which means it can run codes on many devices around the world. Ethereum is blockchain technology on top of which other apps can be built. But unlike other apps built on Ethereum gives you direct power over your data.
I hope the lucid article would have added something more to your memory about Ethereum. As we know everyone is stepping into this digital world, I wish that your investments would be more fruitful with each reading and your investment.