Introduction to Ethereum for Beginners
Ethereum is a cryptocurrency that recently received worldwide attention. The system is decentralized and allows for more privacy within the blockchain. It has also been on the rise in transactions, and trading volume in recent months. So what is it and how does it work?
What is Ethereum?
Ethereum is a blockchain-based platform that allows users to buy into Ethereum, the world’s second largest cryptocurrency. It began in 2015 as a decentralized platform for developers that allowed them all to join a public blockchain network and make use of its code to build their own applications, similar to how the Bitcoin blockchain is used today. The platform also allows people to store their ether tokens. It enables users to upload decentralized applications (dapps), which will be made available for other dapps on the Ethereum system.
How Does Ethereum Work?
Ethereum has its own line of smart contracts called smart contracts. These allow users to create and alter agreements and transactions without the need for a third party.
What makes Ethereum so exciting is its ability to allow you to create decentralized applications (Dapps) that run on the Ethereum blockchain network. Ethereum allows users to buy ether tokens in order to use the decentralized applications.
How can you invest in Ethereum?
Buy Ethereum. A popular method of investing in Ethereum right now is to buy ether tokens, which can be traded on online exchanges such as Coinbase and Gemini. You’ll need a digital wallet that supports Ethereum, such as MyEtherWallet.
The process to buy ether tokens is simple: you’ll need to deposit funds in any of the above exchanges, and then purchase your ether tokens.
These funds will be stored in a digital wallet, which will act as your I.D. The I.D. is how private any transactions are on the Ethereum blockchain network. Think of it like a digital version of your bank account number, only this one is tied to Ethereum’s underlying blockchain system, and can eventually be converted into fiat currencies such as U.S. dollars or other types of digital currencies.
Ethereum has the potential to go hand in hand with Bitcoins’ popularity for several reasons:
- It’s fast and efficient: Since Ethereum allows for faster transactions than most other blockchains, it can basically handle millions of transactions per second. This means that it can actually compete with banks and handle any currencies.
- Smart contracts: Ethereum’s smart contracts also allow for more secure transactions. They increase security by making sure transaction data is completely transparent and shows no signs of tampering or fraud, which allows it to remove third-party activities from the transaction equation altogether.
- No mining: Ethereum’s network doesn’t require users to “mine” ether tokens like Bitcoin does. This is another reason why some are saying that Ethereum’s value could be bigger than Bitcoin.
- Decentralized technology: Ethereum is known as a public blockchain network in which no one person has control over it. This also adds to Ethereum’s value because it can allow new technologies and innovations to take place within the platform.
- DApps: Ethereum’s DApps (decentralized applications) will change the world and the way we think about popular social media platforms such as Facebook and Instagram. Ethereum has already launched several decentralized apps that have potential to be used by anyone in the world. The Telegram chat app uses Ethereum, for example, which allows users to pay for private messages.
Final Thoughts
If you want to invest in Ethereum and use its popular decentralized apps, it’s easy to purchase ether tokens at any of the exchanges mentioned above. If you prefer to use a digital wallet, MyEtherWallet is another popular option. Ethereum’s popularity has grown by a few thousand percent over the past year, and it’s showing no signs of slowing down.
