Ethereum is the second most popular, recommended, and trusted cryptocurrency after Bitcoin in the crypto-verse. Though established and launched just a few years ago, in 2015, Ethereum has made huge strides in value and reputation. Compared to older cryptocurrencies like Dogecoin, which launched in 2013, Ethereum is clearly growing and dominating the crypto markets, considering its status as the second leading cryptocurrency in the world.
What is Ethereum?
Ethereum is not just a cryptocurrency but a digital home to money, global payments, and applications. Ethereum as a community has built a booming and ever-growing digital economy and emerging avenues for creators to earn money online. Moreover, it is open to everyone — all needed is an internet connection. Ethereum is also a decentralised blockchain platform (a system of recording information in a way that makes it difficult or impossible to change, hack, or cheat the system and a digital ledger of transactions that is duplicated and distributed across the entire network of computer systems on the blockchain) that establishes a peer-to-peer network that securely executes and verifies application code. These are called smart contracts and allow users to exchange transactions with each other without the involvement of a third-party or central authority.
What makes Ethereum valuable?
The main factor that makes Ethereum valuable is its technology, which is far more advanced than every other cryptocurrency and is expected to grow continually over the next few years. ETH, the currency and lifeblood of Ethereum, also makes it valuable. Ethereum has a decentralised finance (DeFi) system, an emerging technology that removes third parties and centralised institutions from financial transactions. The components of DeFi are stablecoins, software, and hardware that enables the development of applications. Ethereum’s DeFi system is fairer than traditional financial systems that help Ether users send, receive, borrow, earn interest and stream funds from anywhere in the world through an internet connection.
Ethereum is also a network of assets where users can trade and present their assets as non-fungible tokens (NFTs), individual tokens with valuable information and unique assets like pieces of art, digital content, or media. In simpler terms, NFTs are essentially physical collector items that are digital. So, through an NFT, instead of an individual purchasing a physical piece of art, they would attain an original but digital version of the artwork along with exclusive ownership rights. Through Ethereum, creators can convert their art into tokens and receive royalties automatically every time the art is re-sold. The tokens can further be used to take out a loan — the possibilities vary and are endless. Bitsoft 360, a reputable crypto news site and crypto resource, is home to a comprehensive NFT guide on the top 10 NFT marketplaces in 2022.
Ethereum recently had a merger that introduced ETH 2.0 to the market — a significant upgrade to its initial software that makes transactions faster, fees lower, and energy consumption lower. The merger led to a significant carbon footprint reduction of 99.99%. Before the merge, Ethereum was doing up to 900 billion calculations per second and was responsible for about 44 million metric tons of carbon dioxide emissions per year. This drastic reduction in carbon footprint emission makes Ethereum one of the world’s leading environmentally-friendly cryptocurrencies and platforms.
How to buy Ethereum
ETH can be bought directly from wallets and cryptocurrency exchange platforms. However, rendering these services depends on an individual’s location, as exchanges and wallets restrict where they can sell crypto. Furthermore, there are a few more factors to consider before purchasing Ethereum or any other cryptocurrency:
- Choosing the best exchange platform.
Crypto can only be bought through an exchange platform which allows for the buying and selling of cryptocurrencies. Moreover, the platform also offers trading services and price discovery through trading activity and crypto storage. It is imperative to choose the right crypto exchange platform. This includes determining important factors that will benefit you. These include the overall reputation of the exchange platform, security, and fees.
- It is important to determine just how secure your crypto exchange platform is. Compared to traditional currencies, digital currency is not backed by a government, bank, or central authority. This means that should your account be compromised or the platform you decided to keep your coins gets hacked, you risk losing your digital investment. It is thus important to ensure that you choose a long-standing and reputable platform with heightened security measures that have evidence of working.
Should you decide to keep your crypto with an exchange platform, ensure that the platform uses offline, cold storage and has rigid safety measures against theft. As an extra security measure, some exchange platforms offer independent insurance policies to protect investors from potential hacking.
- It is imperative for all investors to know the fees they will be charged on whichever crypto exchange platform they opt for, including what determines the value of the fees charged. Exchange fees vary greatly and are based on factors including price volatility, the number of transactions, spread or margin on top of the market price, and base fees on a flat rate or percentage of the total purchase, which all vary by location, payment method, and other factors. Security is another factor. Should an exchange have intense protection and overall heightened security measures, the fees might be slightly higher, which is worth it.
Top exchange platforms to buy Ethereum.
- Coinbase
- com
- Binance
- Kraken
- Coinmama
- Bitpanda
Overall, Ethereum is worth investing in. Unlike Bitcoin, which is essentially designed to be an alternative to traditional currencies and a medium of exchange and store of value, Ethereum offers a versatile spectrum of offerings for crypto investors, both new and experienced. Ethereum has a booming technology and blockchain that finds application in numerous areas, including DeFi, smart contracts, and NFTs. The technology used by Ethereum is sustainable and open to different markets and opportunities, making the cryptocurrency even more valuable.