Everything You Need To Know About Ethereum
What is Ethereum(ETH)?
Ethereum is a peer-to-peer network or blockchain with its own cryptocurrency called Ether. Ethereum’s created with the purpose of being a platform through which smart contracts can be built and run. Ethereum’s decentralized platform is specifically created to store, distribute, and facilitate smart contracts.
Ethereum and Bitcoin share many similarities. The difference is Bitcoin stores a list of balances and transactions on its blockchain, but the Ethereum blockchain is designed to store different types of data that can be accessed and used by computer programs running on the Ethereum blockchain. This program usually called decentralized apps, or dApps and many people have been familiar with it.
When did Ethereum create?
Vitalik Buterin is a developer who was working on Bitcoin, he made a whitepaper of Ethereum in 2013. Buterin believed that Bitcoin should be made more customizable and should go a step further than simply being a store of wealth and that it needed smart contract features to determine automatically when payments should occur. Because of this purpose, Buterin created Ethereum in 2014.
Since the beginning of its appearance, Ethereum pioneered initial coin offerings (ICOs). A total of 60 million ETH tokens were sold to early investors while the project was still under development. This event made a huge impetus for developing and promoting the Ethereum ecosystem. Then also with this event, Ethereum managed to get funds to pay legal fees and development fees.
Since then, Ethereum has grown substantially. Some other projects of Ethereum have launched and developed on the Ethereum platform with all kinds of success.
What are The Uses of Ethereum?
Developers around the world can build and run decentralized applications on the Ethereum blockchain and easily build new markets. By using this application of transparent characteristics of blockchain, we can improve the finance industries, personal information storage, and many more. Because Ethereum blockchain can store important documents like business contracts, debts, certificates, or any other data. It can also transfer money anywhere and anytime you want without needing to depend on third parties. Ether as the cryptocurrency of Ethereum is used to pay for operations carried out on the Ethereum network. Besides, Ether can also be used as a trading or investment instrument to get profits.
What are The Advantages and Deficiency of Ethereum?
a. Advantages
1. Large Existing Network.
The benefit of Ethereum is that it is a network that has been tested for years of operation and is worth billions of trades. It has a large, committed global community and the largest ecosystem in blockchain and cryptocurrency.
2. Has A Variety of Functions.
Apart from being used as a digital currency, Ethereum can also be used to process other types of financial transactions, execute smart contracts, and store data for third-party applications.
3. Have Constant Innovation.
The large community of Ethereum developers is constantly looking for new ways to improve the network and develop new applications.
4. Avoiding Intermediaries.
Ethereum’s decentralized network promises to let users leave third-party intermediaries, such as lawyers writing and interpreting contracts, banks intermediaries in financial transactions, or third-party web hosting services.
b. Deficiency
1. Increased Transaction Costs.
Ethereum’s growing popularity has led to higher transaction fees. Ethereum transaction fees, also known as “gas,” hit a record $ 23 per transaction in February 2021, which is great if you’re making money as a miner but less if you’re trying to use the network. This is because unlike Bitcoin, where the network itself rewards transaction verifiers, Ethereum requires those who participate in transactions to cover their fees.
2. Potential for Crypto Inflation.
Although Ethereum has an annual limit for releasing 18 million Ether per year, there is no lifetime limit for the potential number of coins. This could mean that as an investment, Ethereum may function more like a dollar and may not be the same as Bitcoin which is finite in number.
3. Steep Learning Curve For Developers.
For developers who migrate from centralized processing to decentralized networks still can find many difficulties.
4. The Unknown Future.
Ethereum is constantly expanding and improving, and the ongoing development of Ethereum 2.0 promises new functionality and greater efficiency. However, this major update to the network creates uncertainty for currently used applications and offerings.
How to Buy or Sell Ether (ETH)?
To buy or sell ETH can be done at an exchanger. Archidax is the best exchange platform to buy, sell, trade, and store ETH easily.
