Ethereum has hogged the limelight for the last few months. Even though it has not performed well but still, it is one of the mainstream cryptocurrencies which many investors are looking to invest in. Needless to say, many people are trying to find out what is Ethereum in order to make their investment decision.
What is Ethereum?
In the simplest terms, Ethereum is a software-based platform. It is created using the blockchain technology. It is entirely open source in nature. Since it is open source, the developers can use it easily for creating as well as deploying various applications.
The Ethereum blockchain is much more advanced as compared to other cryptocurrencies like Bitcoin. While Bitcoin blockchain is just used for electronic transactions, Ethereum blockchain is used for electronic transactions as well as for deploying various applications. It can be used for planning and executing codes as well. Thus, it is much more advanced as compared to Bitcoin blockchain.
The Ethereum blockchain uses the Ether cryptocurrency. we will go into the details of this cryptocurrency below.
What is Ethereum cryptocurrency?
Each and every blockchain uses an active cryptocurrency. All the monetary transactions on that blockchain are done using this native cryptocurrency. The Ethereum blockchain uses Ether (ETH) as the native cryptocurrency. When you speak about buying Ethereum, you are actually buying Ether. Thus, the next time around you’re thinking of buying cryptocurrency Ethereum, do keep in mind that you are actually investing in Ether cryptocurrency which is based on the Ethereum blockchain.
What are the uses of Ethereum?
As we stated above, Ethereum blockchain can be used for not just conducting the transactions but also for deploying the decentralized applications as well. The code is executed on the entire blockchain which is decentralized. Thus, no single entity has greater control over the code.
The applications which can be coded can include the financial transactions like providing loans or they can be a simple program like making a registry.
With the help of Ethereum blockchain, the decentralized autonomous organizations can also be built. The decentralized autonomous organizations can only be controlled by the individuals who are having these DAO tokens. Thus, separate entities can be easily created on the Ethereum blockchain.
What are the benefits of Ethereum blockchain?
Up until now, you might have already understood that the Ethereum blockchain is actually very different as compared to any other blockchain. That is why it provides quite a few advantages which the others do not. These advantages include:
• Security of data:
The third-party cannot alter the data unless and until given the express permission to do so. Thus, the security which is provided by the Ethereum blockchain is much higher.
• Consensus mechanism:
Consensus mechanism can be easily introduced in the applications as well as the contracts which are being executed on the Ethereum blockchain. This ensures that the various applications can be controlled more efficiently.
Due to the decentralization, again enhanced security is provided. Hacking attempts cannot become successful due to decentralization.
• Zero downtime:
As the entire network is decentralized and consists of many different nodes, the applications, as well as the blockchain, never goes down. This ensures that it operates on a zero downtime basis at all time.
Thus, when you’re trying to figure out what exactly is Ethereum, just go through this article once again and you will be able to clear your doubts quite easily.