Ethereum is an open-source blockchain network. This allows anyone to use this network concept to build anything, such as decentralized applications or
When discussing crypto assets, there are still many people who think that the only cryptocurrency is Bitcoin. In fact, there are many other popular currencies, one of which is Ethereum which is often referred to as a competitor to Bitcoin. However, many still misunderstand what Ethereum is and how it works.
Check out this article for a more complete explanation!
What is Ethereum?
Ethereum is an open-source blockchain network. This allows anyone to use this network concept to build anything, such as decentralized applications or tokens. The purpose of Ethereum is to cut off the access of third-party services and hackers to user data.
In the Ethereum network, there is a native cryptocurrency commonly known as Ether (ETH). Although Ethereum and Ether have become synonymous in the world of crypto assets, they are actually quite different in definition. Ethereum is a blockchain network and Ether is a native coin that moves using its network.
To date, Ether is ranked as one of the largest coins in the cryptocurrency industry by market cap. Like Bitcoin, Ether is run using a blockchain, so encrypted data can be transferred securely, it is impossible to duplicate or falsify.
The Development of Ethereum and the Price of Ether from Time to Time
Looking at its history, Ethereum was pioneered by Vitalik Buterin, a young Canadian-Russian programmer who was very interested in the Bitcoin blockchain network. In 2013, he published a white paper on a decentralized platform called Ethereum.
In its development, Ethereum is assisted by funds from the Fellowship organization. In addition, Ethereum is also assisted with funds generated from crowdfunding that is run by other developers such as Dr. Gavin Wood and Joseph Lubin. Finally, the Ethereum blockchain network was born in 2015 and is constantly evolving.
Currently, there is an Ethereum update which is Ethereum 2.0 or Eth2. This update aims to improve the speed, efficiency, and scalability of the Ethereum network in order to process more transactions and also minimize congestion. The rollout of this update is divided into three phases, namely phases 0, 1, and 2. Phase 0 is carried out in 2020 and two other phases in the following years.
The difference that can be felt is that the mining mechanism used is a proof of stake mechanism, not a consensus mechanism (Proof of Work). In addition, Ethereum 2.0 promises up to 100,000 transactions per second using a shard chain. Security on Ethereum 2.0 is also more secure because the system will be more decentralized.
Meanwhile, the price trend of Ether (ETH) itself is also developing from time to time, fluctuating like other cryptocurrencies. Reporting from CoinGecko, the price of Ether at the beginning of its trade was 2.83 USD per chip. Three months later, the price had hit a low of 0.43 USD.
Quoted from BlockArabia, throughout 2019 the price of Ether tended to experience a deep decline but managed to recover when it entered 2020 because the crypto asset was very booming in the midst of the crisis due to the pandemic. Throughout 2020, the price of Ether increased dramatically by 411 percent, from 144 USD to 737 USD.
In 2021, the price of Ether experienced a massive spike, reaching around 1,800 USD and still rising. Ether recorded an all-time high on May 12, 2021, printing a price of 4,297 USD. Despite the subsequent decline, the price of Ether at the end of July 2021 is still 195 times higher since June 2016.
How Ethereum Works and How is it Different from Bitcoin
As the Bitcoin blockchain network, Ethereum also works the same way. Even so, the system on Ethereum continues to be updated by creating innovations, so that Ethereum as a network can be better. Ethereum operates as a decentralized network. There are two differences in the Bitcoin and Ethereum blockchain network systems.
First, Ethereum uses the concept of smart contracts. Nodes or Ethereum network nodes not only store transactions related to ETH but also store the latest status of the smart contract so that it can be accounted for. This makes Ethereum the most difficult network to manipulate. In addition, Ethereum allows developers to create their own smart contracts.
Second, Ethereum supports dApps (decentralized applications) technology. This technology allows an application to have a fragmented server. So, if there is a hack on one of the servers, data and information will not be spread everywhere. Ethereum allows developers to build dApps that are hosted on or stand on top of them. DApps users can pay gas costs with Ether (ETH).
Ether (ETH) itself can be obtained through purchases or mining. To buy Ether, you can buy it directly through selected cryptocurrency exchanges, one of which is Tokocrypto. At Tokocrypto, you just need to create an account and transfer some funds to a crypto wallet. With a minimum deposit of only IDR 50,000, you can immediately buy Ethereum.
After understanding what Ethereum is and the complete guide, are you interested in investing in Ether (ETH)?
