Ethereum is the 2nd largest cryptocurrency project, expanding upon Bitcoin technology to create a functional ledger for developers and consumers. But unlike Bitcoin, Ethereum’s network of decentralized applications and smart contracts are already being used to provide enhanced security and faster processing.
Are you interested in investing in Ethereum? Our guide can help you learn how the Ethereum network operates and how you can get started with your 1st purchase.
- Ethereum Price
- About Ethereum
- How to Use Ethereum
- See All 6 Items
Ethereum Price
Like every cryptocurrency, Ethereum’s price changes on a daily basis as the market moves. Knowing the current price of Ethereum and tracking how prices are changing over time can help you decide on the best time to buy is.
Browse today’s Ethereum price below to get started.
About Ethereum
Ethereum is an open-source platform that allows users to connect with one another through decentralized applications. Ethereum’s network is based on the use of “smart contracts,” which are self-executing contracts that send money when a specific set of conditions are met. This eliminates the bottleneck and unnecessary fees used by middlemen when completing transactions.
How do smart contracts work? As an example, let’s think about the process of buying a home. Typically, the buyer needs to put the down payment into a special account called an “escrow account,” which is held by a 3rd-party service.
After the funds are in escrow, the seller can transfer possession of the property to the new homeowner. The use of the escrow service ensures that the buyer isn’t able to lay claim to the property before they’ve paid, and that the seller doesn’t make off with the buyer’s down payment without transferring ownership of the property.
Smart contracts in this example could potentially use code to assume the role of the escrow service. When both the buyer and the seller meet a specific set of conditions (transferring funds vs. transferring ownership of the property), the smart contract would execute and provide each person with what they want out of the transaction. This would streamline the buying process and eliminate any fees charged by the escrow company for their services.
Ethereum’s community takes advantage of these smart contracts by creating decentralized applications (dapps). Dapps are a type of application that uses the Ethereum network to execute transactions, rather than a single centralized point of access. The Ethereum network is made up of thousands of computers across the globe, which provides users with a higher level of privacy and security when sending money and information.
The Ethereum network requires a cryptocurrency called “Ether” to operate. Ether is sometimes referred to as the “gas” that runs Ethereum because dapp users must pay a small amount of Ethereum each time they execute a transaction. In exchange, the users on the network that verify the transaction and record it on the blockchain are rewarded with a small amount of Ether. When you invest in Ethereum, you’re actually purchasing Ether coins.
Though the 2 are constantly compared to 1 another, Ethereum is not the same thing as Bitcoin. Both cryptocurrencies use the same basic technology of peer-to-peer decentralization and blockchain verification of transactions. However, Ethereum expands upon Bitcoin’s technology, providing users with a practical ledger they can use to program applications and connect with other users.
Ethereum was developed in 2013 by programmer Vitalik Buterin. It was initially released in July 2015. Ethereum is the 2nd largest digital currency worldwide. It has a market cap of over $247 billion and a daily trading volume of $9.91 billion.
How to Use Ethereum
Ethereum’s decentralized application capabilities have been adopted by a wide range of industries. Though the technology is still largely in its infancy, you can use Ether to participate in the many dapps currently running on the Ethereum network.
Some current industries adapting Ethereum’s technology include:
- Crypto. Cryptocurrency exchange has been made more affordable and faster through the use of Ethereum. Uniswap is a popular dapp that allows you to swap Ether that you own into hundreds of smaller cryptocurrencies with lower fees than standard exchanges.
- Data-sharing. In the age of social media ubiquity, sharing personal information with corporations is a major concern. Projects like uPort allow you to retain full control over your personal information while transmitting data to another user by capitalizing on the decentralized nature of the Ethereum network. Some projects have taken this concept even further — for example, AKASHA is a completely decentralized social media platform that allows you to retain control of your information while connecting and sharing content with other users.
- Gambling. The Ethereum network can also be used to create fun applications as well as practical ones. PoolTogether is a lottery system that allows users to purchase a virtual Ether lottery ticket. The funds from each ticket go together into a single pool — and every week, 1 lucky winner is rewarded with the entire pool of Ether.
Like any other type of cryptocurrency, you can also invest in Ethereum by strategically buying and selling Ether. To get started, you’ll create an account using a brokerage account that offers access to Ethereum investing. As Ethereum is 1 of the world’s most popular cryptocurrency projects, you’ll have a selection of brokers to choose from.
When you believe that the price of Ether will rise, you can purchase coins using fiat currency, another cryptocurrency and sometimes a debit or credit card depending on your broker. From here, you can either store your Ether long-term in a wallet or you can capitalize on small price movements throughout the day or week.
Best Online Platform for Ethereum
Ethereum is the 2nd largest and most popular cryptocurrency project in the world, behind only Bitcoin in terms of market capitalization. This means that, unlike some smaller altcoins, you won’t have trouble finding a platform where you can buy Ethereum.
Before you choose a broker, consider fees, commissions, ease of use, the broker’s unique trading platform and the types of cryptocurrencies you can buy and sell using the platform.
Not sure where to begin your search? Consider a few of our favorite platforms below, which currently support Ethereum trading.
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How Will Ethereum Scale?
Ethereum is currently facing a problem with scaling. Like any ledger service, the network’s goal is to process as many transactions as possible for as many users as possible. On Ethereum’s current network, users can process about 15 transactions per minute. By comparison, credit card company Visa’s technology can process around 45,000 transactions using its centralized network.
There are several Ethereum projects that are currently attempting to tackle the scaling issue. 1 method, called “sharding,” reduces the stress on each node needed to verify transactions by splitting small fragments of information between nodes, which can process additional transactions by providing a small amount of information to each other. Another solution may include incorporating off-chain transactions, which borrows its technology from the Lightning Network used to verify Bitcoin transactions.
As Ethereum is still a relatively new technology, there are many potential solutions that have not yet been explored. Ethereum founder Vitalik Buterin has said that the eventual end goal of the Ethereum network is to support “Visa-scale transaction levels” or greater. While this is currently not possible, the team is exploring potential ideas to increase scalability.
Add Ethereum to Your Portfolio
Though the realm of cryptocurrency presents a far-reaching range of diverse opportunities, it’s important to remember that all cryptocurrencies are still highly unregulated. Ethereum (or any other coin or project) can plummet in value at any moment, and no coin has a guaranteed value.
If you do decide to begin investing in cryptocurrency, be sure that coins make up only a small percentage of your overall investing portfolio. Use our guide to get started with your 1st Ethereum investment.
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About Sarah Horvath
Sarah Horvath is a prominent freelance senior copywriter renowned for her expertise in cryptocurrency. As one of the leading voices in the industry, Sarah’s insightful analysis and comprehensive understanding of cryptocurrency trends have made her a sought-after contributor to major finance sites. With a focus on providing clear, accessible information, Sarah empowers readers to navigate the complex world of cryptocurrency with confidence. Her dedication to delivering high-quality content has established her as a trusted source for cryptocurrency enthusiasts seeking valuable insights and guidance.