Ethereum Is A Cryptocurrency Application

Ethereum is a cryptocurrency application

Between Ethereum vs Bitcoin, many people are still confused and doubtful in this new form of investment.

Ethereum: A Next-Generation Cryptocurrency and Decentralized Application Platform

If the technology behind the two largest cryptocurrencies is still a puzzle to you, and still you’re undecided if you should invest in them, we’ve got the answers.

What Is Cryptocurrency?

Before cryptocurrency became popular, the only way to send and receive money was through banks or payment services like Paypal.

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The function of banks is to verify our transactions. They make sure that we have the money to pay for our purchases. In return for this service, they charge fees.

This was the normal way of making transactions until an economic disaster akin to the 1930s Great Depression happened in 2008.

Ethereum is a cryptocurrency application

What many called the 2008 Financial Crisis is what paved the way to the birth of Bitcoin and cryptocurrency.

To put you up to speed, banks gave subprime mortgages to lenders who struggle to meet prime mortgage criteria. This led to the 2008 financial crisis.

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As a result, people lost trust in banks so much that they used a new system of managing their assets, one which does not include any middlemen.

Satoshi Nakamoto

Satoshi Nakamoto invented the first-ever cryptocurrency, Bitcoin. It is originally a peer-to-peer, decentralized, digital cash system but turned out even better as a new form of currency.

The Double Spend Problem

Back to the same problem of making sure that people have money for their purchases, Bitcoin addresses it differently by making transactions public without revealing any personal data.

Through blockchain technology, it would be easy to detect if someone is using money illegally.

Ethereum Cryptocurrency: Everything A Beginner Needs To Know

Not entirely restricted to money, you can send files, use services, and exchange values, without having to go through third-party organizations like banks.

Global Scale Effect Of Cryptocurrency

Looking at Bitcoin as a new form of currency, you can see the effect on a global scale. You can now send money without having to think about dollar conversion since cryptocurrencies are 100% digital and public with the same value regardless of where you are.

Money transfers will be faster and cheaper. As opposed to relying on centralized banks to manage transfers, Bitcoin transfers directly from person to person.

What Is Blockchain Technology?

There’s an entire ecosystem of cryptocurrencies; Bitcoin is just one of the existing hundreds.

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Blockchain is the technology behind cryptocurrencies. It enables transparency on transactions.

Blockchain refers to digital information in a database. When a transaction occurs, it is verified, or stored in a block. Rather than actual people, however, a network of computers verify the transactions. This makes it even better because while transactions can be viewed and distributed, they cannot be edited, even by the Bitcoin creator.

How To Make Money Through Cryptocurrency

In the article How To Make Money Through Cryptocurrency, you can see ways on how you can earn cryptocurrency itself including Microtasks, Affiliate Marketing, etc.

But sticking to the subject, there are three popular ways to make money through cryptocurrency which you can consider as a form of investment.

  1. Buy & Hold is the most popular way, which also could be the one you’re familiar with.

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    In this method, you buy cryptocurrencies, let the “money” stay in your account, and wait until the price of the currency goes up before you sell them at a higher rate.

  2. Mining works by having your computers solve equations to make up the blockchain network, and in turn, rewards you with cryptocurrency.
  3. Day Trading is another way of earning which benefits from the drastic changes in rates that occur in the cryptocurrency market.

    If Buy & Hold requires you to keep it for a couple of months, you can earn from day trading in just over an hour.

In comparing Ethereum vs Bitcoin, a lot of questions have to do with whether they are worthy of investments. While there is no way to predict if there’s a future for cryptocurrencies, it’s worth looking at the potential of both.

Investing In Bitcoin

Bitcoins are your money in digital form.

People buy Bitcoin to have other venues for storing money other than in the bank. More commonly, people buy Bitcoin in hopes of the value increasing – giving them a profit since they bought it at a lower cost.

Ethereum is a cryptocurrency application

Most companies today allow equity, which you cannot purchase using traditional currency but through an ICO (initial coin offering). In the industry of cryptocurrency, this is equivalent to an IPO.

It’s worth investing in Bitcoin purely because, while it’s a volatile market, it’s been established as the first cryptocurrency.

What Can You Buy With Bitcoin?

You can use Bitcoin as a payment service as long as the company or business that you buy products with accepts it.

While it can be used as a currency to buy products, Bitcoin can also be used as an investment to keep for long-term gains.

How To Make Money With Bitcoin?

Bitcoin Mining is validating transactions on the blockchain network. These are in the form of math puzzles that miners solve and in exchange, it pays them with Bitcoin.

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It’s one of the easiest get-rich-quick tactics of Bitcoin investors.

Investing In Ethereum

Now that we know that money can be decentralized, it’s possible that other services and functions can be decentralized too.

Ethereum is a fairly new technology that was launched in 2015 by Vitalik Buterin, a programmer in Toronto, Canada.

Ethereum is a cryptocurrency application

Take note that we’re calling it technology (or a platform) rather than a currency as Ethereum goes beyond being a digital currency.

What Is Ether?

Although it’s important to note, that one of Ethereum’s functions is also as a digital currency called ether or ETH.

In the one-year period between 2017 to 2018, ETH value has grown 25 times. This fact alone, leads people to believe that it is worthy of investment.

Decentralized Application Or DApps

Ethereum runs smart contracts and revolutionary EVM (Ethereum Virtual Machine) which enables applications to run as programmed without any possibility of fraud or third-party interference.

If that’s too technical a definition, think of Facebook keeping your information when you sign up in their network.

Ethereum is a cryptocurrency application

It has your personal details such as phone number, email, location, etc.

Invisible networks of computer servers keep all our information. In normal cases, these networks of computer servers are vulnerable to hacking. Often meaning we are vulnerable to hackers too.

Ethereum changes the way the Internet works.

With decentralized information, we are less likely to get hacked and less likely that the systems can shut down. Ethereum users help run the network.

Why Ethereum?

Even the creator can’t change it! Rather than keeping the information on central servers, the information is stored in the network.

Smart Contracts run the transactions and operated on agreed-upon rules as a yes or no system.

Create Your Own Cryptocurrency On Ethereum 1 - ERC20 Tokens - Blockchain

It does exactly and only what it’s programmed to do. Since transactions are solved and approved by computers, trust between users isn’t needed.

The more we discuss Ethereum, the more technical it gets. But the takeaway is that the revolutionary changes brought by Ethereum can make products and services cheaper.

Ethereum vs Bitcoin: Are They Worth Investing In?

One of the main reasons people invest in cryptocurrency is to diversify their portfolio.

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For the same reason that Bitcoin was created, the financial crisis taught many investors not to put all their eggs in one basket.

Down to the question of whether you should invest either in Ethereum, Bitcoin, and other cryptocurrencies available today, there are a couple of reasons to do so:

  1. Investors, who expect the fall of the said Dollar Imperium, would invest in cryptocurrencies to hedge their net worth.
  2. If you believe in the potential of blockchain technology operating in major businesses soon, then it’s a good reason to invest in it.

    In this article alone, there’s a list of 50 companies already adopting blockchain technology.

    Ethereum is a cryptocurrency application

    A smart move is to invest in regulated professionals especially since it’s become so hard to identify trustworthy Bitcoin trading platforms.

However, just because the prices are up lately doesn’t mean you can profit from it. Straight out, financial experts will tell you to not invest in cryptocurrencies.

Unstoppable Bitcoin Headed Back to $15,000?

It’s a volatile market that’s risky or even not worth spending a dime in.

But just like any investments, investing in as volatile a market like Ethereum vs Bitcoin, you can only hope for a couple of things. That you made the right calculated risks, your predictions right, and the market trends in your favor.