The Ethereum network is accessible to all; it’s open-sourced and most importantly, it is secure. Ethereum’s technology was inspired by Bitcoin but with a wider range. This technology creates a platform where you can do more. You can make transactions, develop applications, hold assets, etc without the supervision and control of a central authority.
Most times, Bitcoin and Ether (the Ethereum coin) are called in the same context. However, they are different in certain ways: the way of development and the function they perform.
Knowing what cryptocurrency is will help you understand what Ether is and how it differs from Bitcoin, so let’s take a look at that.
Cryptocurrency, including Ether, is a type of currency that exists digitally and virtually. This type of currency is secured with the use of a cryptograph which ensures its security and prevents counterfeiting.
In 2008, it became possible to make online financial transactions with Bitcoin. It started enabling the movement of funds across the world quickly and efficiently. The significant difference in this form of transfer, when compared to others such as bank transfers or financial services, was that it did not require a middleman.
A middleman or central authority intervenes in transactions and can censor, revert, surveil and share sensitive data about you. They have the power to restrict you from any financial service. Crypto does not work that way. They don’t intervene in transactions made and yet still secure your funds. This is a result of the Blockchain tech that forms the operation principle.
The Blockchain is simply a transaction database where any new transaction, which is called a block, is added and shared to several computers, all in one network. Most of these are not published and can not be removed. Only data can be added.
When Bitcoin was created, its purpose was to serve as a different currency that is not centralized. In that same view, Ethereum is very much like Bitcoin. But its aspirations aim far higher.
Ethereum’s purpose is not just to create another type of decentralized digital currency. It is to create a platform where anyone can develop decentralized applications, and have greater control over their programs.
Ethereum is a network inspired by Bitcoin tech and even though they both work using the Blockchain tech principle, there are notable differences:
- Bitcoin allows you to make transactions without a middle man but on Ethereum’s platform, you can do more than send and receive financial packages, digitally. You can build decentralized apps on the network.
- Bitcoin is a cryptocurrency that is developed using Blockchain tech while Ethereum is an open-sourced network that makes use of the ether cryptocurrency.
- Bitcoin is not infinite. With Ethereum, its potential is unknown.
It is no news that there’s a lot of buzz in the market about the increasing value of ether, as it becomes increasingly available. Nevertheless, it wouldn’t be wise to follow the buzz and jump in, especially without proper research. The tech is relatively early and promising, and uncertain too. One may not know which may come out on top at the end of the day. Consulting with a trusted crypto exchange provider would be a good way to go.
Ethereum’s decentralized network is created using blockchain technology, and is powered by ether cryptocurrency. Buying ether is a way to invest in the network. Although, as it is with other cryptocurrencies, it is wise to do research before investing in a digital coin. With Ethereum, one can never know how it will go because of its unpredictability.