Ethereum is a decentralized platform that runs smart contracts. It supplies a decentralized turing-complete virtual machine known as the EVM Ethereum Virtual Machine. The Ethereum network is kept running by computers from all over the world. There is a reward given to the computer that creates the latest block in the chain .A new block is added to the block chain every 12 seconds the computer that generated the block will be rewarded with 5 Ether.
Ethereum was developed by Vitalik Buterin (a former programmer of Bitcoin) in 2013 and then initially released on the 30th of July 2015. Although it is only two years old it is one of the main contenders in Cryptocurrencies. Although strictly speaking Ethereum isn’t exactly a crypto currency. It is a platform that allows individuals to draw up contracts and make transactions. This is done by using a currency called Ether.
Ethereum has been designed to be a platform where two parties can enter into a contract without a third party to oversee it. This is made possible by the use of something called a smart contract. Smart contracts create trust between two parties. To put it simply let’s say you buy a car from me, you will get a receipt that is held in our virtual contract. We agree a date on which the contract is to be completed by. If the contract is completed by the date then I receive my Ether and you receive the key to pick up the car. This transaction is witnessed by hundreds of people. Meaning that you can expect a faultless transaction.
Pros To Ethereum:
- You can earn block rewards from the network from mining.
- Immutability – Meaning that third parties cannot make changes to data.
- Ethereum transactions cannot be reversed, protecting businesses from chargebacks.
- Ethereum has the possibility of vast growth
Cons to Ethereum:
- When you invest in Ether there is always the potential that you can lose on your initial investment.
- Volatility remains high.
- Slow network during major ICOs
- Do not leave Ether in exchanges, and always use the multi-step authentication using apps like Google authenticator.
As Ethereum scales and becomes more commonplace Ethers price may stabilize. It is this possibility that is exciting investors. The main difference between Bitcoin and Ethereum is that Bitcoin has been designed to be a digital form of money and a payment system. Whereas Ether is a means to buying services within Ethereum. It is for that reason that some investors believe that it may someday become a foundational layer of the internet. If this does happen then Investors in Ethereum will be seeing large profits. But there is absolutely no guarantee that this will happen. For more information check out the Ethereum website here www.ethereum.org
So should you sit on your Ethereum?
Although Ethereum is still technically in Beta stages it’s certainly worth getting some Ether and just sitting on it for the time being. If you don’t do this you may well regret your decision not to invest. As it is a very hot contender holding one of the top places in cryptocurrency.
Have you invested in Ethereum? How would you rate it? Choose below