Technically speaking, Ethereum is unlike any other cryptocurrency. Powered by its digital currency, the Ether (ETH), Ethereum is a decentralized, blockchain-based software platform that hosts a payment system and an app store on its network.
Probably other than Bitcoin, Ethereum's ETH comes as the next most popular cryptocurrency today. Based on market capitalizations, it holds the second spot and is among the most widely traded crypto assets on eToro.
Simply say: The Ethereum universe is where users can have secured and reliable transactions by using smart contracts under no bounds of any censorship and regulation. What Bitcoin did to Blockchain technology—by inventing it—Ethereum is improving it.
Remember: the Ethereum is the system, while the ETH (Ether) is its native currency. We will learn more about the ETH more than the technological composition of the Ethereum system, as ETH is the cryptocurrency you might want to invest on.
If you're considering of investing on this cryptocurrency right now then you better click on the button below to get started. This will take you to eToro's ETH trading page. Should you wish to continue, simply open an account with them but don't worry, this will only take a few minutes to do.
67% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you can afford to take the high risk of losing your money.
Inspired by Bitcoin in 2012 at the young age of 17, Vitalik Buterin first became a writer for Bitcoin Magazine. Much of his articles talked about how to improve the Bitcoin platform. Part of his recommendations includes a proposal of his idea for Ethereum.
Frustrated at having his suggestions fall on deaf ears, Buterin decided to create his own. After being crowdfunded in 2014, Ethereum was launched on July 30, 2015 with 72 million ETH coins.
As the local currency of Ethereum, Ether is the one that powers it. It makes sense that it is called as the "gas".
Each transaction made on the Ethereum system requires an amount of ETH—or the 'gas'—in order to proceed with the transaction.
Ether (ETH) fuels all smart contracts in the Ethereum network. For example: If John wants to pay Leo 15ETH to build a fence for his house, he can do so by using an Ethereum smart contract.
The transaction will occur like this: Leo will receive his 15ETH payment from John ONLY when Leo is done building John's fence.
With the help of Ethereum's smart contract technology, John won't be able to pay Leo until the fence is finished. With 'smart contract', all transactions are considered safe and not prone to any forms of cheating.
A snowballing excitement is being generated by using Ethereum today in the so-called DeFi applications (Decentralized Finance) being built by developers in the Ethereum platform. These blockchain-based financial services applications can bypass banks and other brokerages.
Sergey Nazarov, co-founder Chainlink, a leading Smart Contract Network said:
Thousands of developers are building applications that recreate traditional financial products in decentralized ways on top of Ethereum, and as more and more users pour in to interact with these apps, they require ETH (ether) to conduct any transaction.
Many analysts see Ethereum as a more flexible cryptocurrency than Bitcoin because it is programmable according to how it is being used. It can easily verify business transactions, payments and contracts.
The transaction time of Ether is faster compared to other digital currencies plus a growing number of 'brick-and-mortars' retailers and online merchants are starting to accept ETH. One major example is the giant auction house Christie's which started accepting ETH as payment in 2021.
Although considered as a volatile crypto with expensive "gas" (transaction) fees, Ethereum comes with several upsides. These includes the following:
Similar to Bitcoin, there is also "mining" involved in Ethereum. Called as such because it resembles an act of mining golds, but in Ethereum, "miners" are digging through the network of transactions to verify.
Mining in Ether is known as "Proof-of-Work" or the PoW and every miner (an Ethereum node) is given one Ether as a reward for verifying a transaction.
Like Bitcoin, mining in Ether requires a powerful computer and generates a lot of power making it unappealing to the eyes of environmentalists.
The ETH price can be compared to a roller-coaster with a lot of upsides, some downward slopes in between long lines of slight movements. It is regarded as one of the most unpredictable cryptocurrency in the market today.
Currently, it has a 52-week average of $193.35 to $4,362.35 making investing on ETH as both a high-yield and high-risk undertaking.
CFD Trading or "contract for difference", is a popular trading method that comprises of an agreement to exchange the difference in value of a trading commodity—in this instance, the Ether (ETH)—from when you open a position to when you close it.
You can do CFD trading on the eToro platform on a variety of cryptocurrencies including Ethereum's Ether (ETH).
No need to move a muscle. Clicking on the button below will take you to eToro's ETH trading page and if you want to try it out, you can quickly open an account.
eToro is a multi-asset platform which offers both investing in stocks and cryptoassets, as well as trading CFDs.
Please note that CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 67% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work, and whether you can afford to take the high risk of losing your money.
Past performance is not an indication of future results.
Cryptoassets are volatile instruments which can fluctuate widely in a very short timeframe and therefore are not appropriate for all investors. Other than via CFDs, trading cryptoassets is unregulated and therefore is not supervised by any EU regulatory framework.
eToro USA LLC does not offer CFDs and makes no representation and assumes no liability as to the accuracy or completeness of the content of this publication, which has been prepared by our partner utilizing publicly available non-entity specific information about eToro.