Ethereum is often considered to be the second cryptocurrency, but it is not in fact a cryptocurrency. It's distinguished by several attributes that enhance its scalability over Bitcoin. For instance, smart contracts and decentralized apps.
Difference between Ethereum and Ether
As we previously mentioned, Ethereum is more than just a cryptocurrency.
Ethereum is a blockchain platform. If you've heard of the blockchain term multiple times, but don't understand what it means, then here's an example.
You operate a call centre, you need to call 50 clients in one day, therefore, you create a database and call clients from it. Blockchain is basically a decentralized database with an advanced design. All data is stored in blocks, and the system is composed of a continuous series of these blocks. They're in chronological order, which means that the first customer will always have the highest priority in the records. Additionally, you will not be able to falsify the number of calls or remove a record if the information is stored in the blockchain.
As such, blockchain technology can be employed to create an immutable database of orders, payments and other information. The system has internal mechanisms that prevent unauthorized access and ensure consistency between all parties involved in the transaction.
Ether is the token used to pay for data transfer in this network. Essentially, it is the local currency.
The main idea of Ethereum
The fundamental concept of Bitcoin is the capacity to possess money that is not dependent on the state. The primary concept of Litecoin is to be able to pay with cryptocurrency at the comfort of your home. However, the primary concept of Ethereum is the creation of a separate economic system that is not dependent on politics.
“If crypto becomes successful, it is not because it empowers people. It's because it empowers the best institutions,” - said Vitalik Buterin (Ethereum founder) in his Forbes interview.
What is different about Ethereum that Bitcoin lacks? The response is a smart contract.
We previously discussed the way the blockchain functions. Since the ETH system is decentralized, this implies that users anywhere on the planet can develop an application that cannot be removed from the network. Also, since Ether has a value, these apps can stipulate the conditions for the exchange of cryptocurrencies. These programs are referred to as smart contracts, and they can be built to function autonomously without human intervention.
To arrange everything on the shelves, we can use other examples again. You recently purchased new sneakers in the Instagram store. You texted the managers, they emailed you the payment requirements, you paid for everything, but your purchase never reached you. Furthermore, you can file a complaint and even go to police, and it appears that you can receive a form of investigation as well. The law functions as a third party that safeguards your rights and interests. In Ethereum, the same guarantor is a smart contract. It's simply part of the code associated with the blockchain. However, it determines the terms of the warranty and describes how to conduct a particular action. If you follow the protocol, the transaction is automated.
Should you buy ETH?
When discussing the purchase of ETH, it's important to mention another unique technological attribute of Ethereum.
It's capable of creating:
- DeFi: these are instruments of finance that are composed of services and apps developed on blockchain.
- NFTs: non-fungible tokens, which have no similarities, since all of them are unique.
- DAO: decentralized autonomous organization. It's a fully autonomous system in the blockchain that is programmed by code and lacks human intervention.
Why is this important?
Ether is a form of digital currency. Additionally, many individuals utilize this resource to make long-term investments and currency trading. However, unlike Bitcoin, the Ethereum blockchain is more versatile and has additional methods to work with ETH. It can function as the source of lifeblood for decentralized financial applications and markets, exchanges, games, and more.
Where to buy ETH?
If you've decided to purchase the second-largest currency in the world, here is the procedure. To begin, you will require Kolo.
Kolo is a platform that supports multiple currencies. It's functional as a means of payment that makes it simple to purchase cryptocurrency, and most importantly, it is understandable. ETH can be purchased via a debit or credit card, or through a bank transfer.
Step-by-step instructions for purchasing Ether:
1. Go to the Kolo website and log in to your account.
2. Visit the Exchanger section in your profile and choose the Buy crypto section.
3. Enter the desired amount of ETH and provide your ETH wallet address
4. Add all the necessary personal information. After that, confirm the purchase.
Conclusion
Ethereum is a unique technology, and Ether is a unique currency. Before purchasing it, you need to research it yourself and determine if it is appropriate for your financial portfolio. Remember that you are solely responsible for your cryptocurrency. No one will be able to give you back your money if you are defrauded.
Invest and preserve your assets with care, then you'll believe that cryptocurrency is simple and promising.
