Investors are investing in digital currency to ensure that they receive higher gains on their investment. In some cases, investors are even able to see record-high profits in less than a year! While this may sound exciting, it is challenging to know which currency you should invest in and how you should do so. If you learn more about cryptocurrencies, it is easy to see that they are far more interesting than you would believe at first glance.
Recently, there has been a growing interest in buying Ethereum, and many may be wondering whether it is a good idea to invest in it. Are you wondering the same? Read on to find out more about this Cryptocurrency.
Ethereum: What You Should Know
Early in 2014, Vitalik Buterin announced that he was planning to launch another cryptocurrency named Ethereum. It is a platform for decentralised applications and borne out of Buterin’s wish to create an alternative blockchain system that allows users to achieve a lot more with their Cryptocurrency.
How Is Ethereum Different?
Unlike other cryptocurrencies, Ethereum features Turing-complete smart contracts. Smart contracts operate on an if-then scenario; when agreed-upon conditions are met, a particular action occurs. This is quite an innovation and could have wide-reaching implications, even beyond the field of cryptocurrencies.
Smart contracts ensure that agreed-upon terms are met and that organisations can keep track of agreed-upon conditions. They can also check whether they are being met and do a lot more. The terms are binding and cannot be changed.
Once the smart contract is in place, both parties are obligated to fulfil the contract’s conditions. Thus, smart contracts do not rely on trust but instead, rely on agreed-upon conditions between two parties. Currently, Ethereum’s token Ether is the second most valued Cryptocurrency in the world.
Safety of Ethereum
When investing in any cryptocurrency, one of the first questions that come to mind is whether it is safe. Trusting in Cryptocurrency can be a bit of a gamble, especially when it is so new. However, Ethereum’s selling point is its safety. Applications that are built on Ethereum’s decentralised platform are much safer and less prone to hacking.
How Does Ethereum Keep Its Blockchain Secure?
Well, Ethereum’s system records every single change in its blocks. This means it records every transaction happening all over the world and updates all of its ledgers accordingly. Once a block reaches its total capacity, another block is added to the chain.
To decrypt any information, one needs to solve a complicated puzzle when buying Ethereum. The puzzle is almost impossible to solve, and at the same time, miners will need to have industrial-scale resources to mine a new block. Hence, it is generally safe to say that Ethereum is quite safe.
Although Ethereum has faced a hacking issue in the past, it was promptly solved, and users could vote for changing the rules of the governing system. This gave rise to two new systems, the Ethereum and the Ethereum Classic.
Are Ethereum Transactions Fast?
Currently, the transaction speed is one of the reasons why Ethereum’s growth is hindered. Compared to centralised platforms, Ethereum has a slower transaction speed.
The smart contract needs to be fulfilled, the block data needs to be changed, updated, and encrypted, the ledgers all over the world need to be updated, and then a new block will need to be generated, to complete any transaction. This process can take a while; the more the number of transactions, the longer is the wait.
Hence, while Ethereum is still working to improve its scalability compared to other centralised platforms, its transaction speed is not up to par.
What Features Should You Consider While Buying Ethereum?
Investment is always tricky, but with Cryptocurrency being such a volatile market, many are unsure whether they should cut their losses or hold out for better returns on their investment. While most would agree that investing in Ethereum is a good idea, you should also look into Ether price trends before deciding to invest. While many people have seen immense returns on their investments, few have lost their money too.
For ensuring that you invest during the right time, it is important to check any real-time crypto price tracking website and track the changes in prices. Generally, investors buy Ethereum when it is low and then trade it when prices are high, ensuring their profits.
This cycle keeps repeating itself as a way to guarantee profits. Hence, some people may hold on to their Ether token for a few days, while others may hold onto it for a year or more.
