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What is Ethereum? The Definitive 2019 Beginners Guide


  • Ethereum was created in July 2015, by Russian-Canadian programming prodigy, Vitalik Buterin

  • As well as being a cryptocurrency, Ethereum is a decentralized virtual computer programming environment. Specifically, one which allows third-party developers to create decentralized apps and ICO coins

  • Ethereum also makes it easy to create smart contracts which provide a low-cost alternative to traditional escrow services

What is Ethereum?

Ethereum was arguably the second most profitable cryptocurrency to invest in during 2017. In just 12-months, ETH prices rose from just $14 to well over $1,400. Since this time, prices have pulled back sharply. Here, we’ll, therefore, look at what Ethereum is and how likely it is that ETH prices might recover in 2019


Ethereum Vs. Bitcoin

Bitcoin is the world’s best-known cryptocurrency. However, Bitcoin is also one of the world’s most basic. All that the Bitcoin does from a technical perspective is keep track of BTC transactions.

Initially created in July 2015, Ethereum is different to Bitcoin. Instead of merely processing peer to peer transactions, Ethereum also operates as a distributed computing platform. Specifically, one which allows third-party developers to create and launch decentralized apps (D’Apps), and even alternative forms of cryptocurrency.


What is Ethereum Used For?

Ethereum founder Vitalik Buterin created Ethereum to cater directly to the needs of businesses and blockchain developers.

When starting a business, entrepreneurs are required to secure funding from investors. Either this or qualify for bank loans. Ethereum changes this by allowing startups to create ERC20 tokens. These are independent forms of cryptocurrency which run on the Ethereum blockchain, and which can be sold to raise investment capital.

As well as ICO coins, the Ethereum Virtual Machine (EVM) also provides developers with a platform where they can create and launch D’Apps. Specifically, apps similar to apps like Uber, which can be monetized using Ethereum.


Ethereum Smart Contracts

To cater to a diverse array of users, Ethereum also makes it easy to create Smart Contracts. In effect, Smart Contracts represent a fully automated alternative to mainstream escrow services. This is thanks to the fact that any real-world asset can be digitized. Real estate, precious metals, and service agreements can, therefore, all be locked into a Smart Contact and only released when specific sales conditions are met.


Ethereum Benefits

  • Smart Contracts replace real-world escrow agents where transactions can take weeks (or longer) and often incur high-fees

  • New Ethereum ERC721 tokens allow Ethereum to be used as a platform which tracks the real-time ownership and location of commodities

  • As well as using the Ethereum network to raise startup capital via ICOs, Ethereum can also be used to build and test entirely new blockchains, before migrating finished blockchains to their own main net

2019 Ethereum Price Predictions

Ethereum prices pulled back sharply during 2018. For the most part, this was due to broader bearish market sentiments and increased ICO regulation. However, during this time, several Ethereum competitors have also arrived on the cryptocurrency market. Namely, EOS, Cardano, NEO, and The Stellar Network.

Due to increased competition, it is unlikely that Ethereum will perform as well during the next Bitcoin bull run as ETH prices did during 2017. However, Ethereum prices have historically mirrored the performance of Bitcoin. For this reason, Ethereum is still investment friendly. Moreover, Ethereum founder Vitalik Buterin is working on several upgrades to the ETH blockchain, designed to make Ethereum more competitive in the future.

Disclaimer: Cryptocurrency prices are inherently volatile. Information in this article should not be considered professional financial advice. If you are looking to invest in cryptocurrency, you should do your own research and make yourself aware of potential pitfalls.

© 2020 by fox.exchange

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