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Ethereum: Why It Is Important to Understand Ethereum

By October 18, 2017Ethereum, How To
bitcoin ethereum

Bitcoin is the leading cryptocurrency and it does one thing- it acts like a coin. There are ways to use the Bitcoin blockchain for other tasks, but the technology is cumbersome. This is where Ethereum, steps in. The Ethereum network carries many tasks and transacts in thousands of tokens. All of this is powered by computing power coming from video cards.

Ethereum, also known as ETH was created by Vitalik Buterin, then a 21-year-old programmer with genius-level skills. He saw the faults and deficiencies in the Bitcoin protocol and created a new coin to introduce new functionalities.

Ethereum coins are necessary to pay for transactions on the network. So if you want to use some of the interesting new applications based on the Ethereum blockchain, you need to own some ETH tokens to speed up your transactions. When you send out a transaction, it consumes Gas. That Gas has a price, usually a small fraction of Ethereum. Without Ethereum in your wallet, you cannot pay for transactions and they will fail. Miners will receive the Gas you pay as a reward whenever they include your transaction into the next block.

If you own Ethereum, or mine it, you have access to investing in thousands of tradable tokens. But more importantly, you can also invest in token sales and initial coin offerings. These are new tokens sold to fund blockchain projects. The bets are risky, but sometimes, the payout is significant. It is essential to go beyond Bitcoin and know how to buy Ethereum.

ETH is among the most accessible altcoins, available for buyers with a credit card. You cannot invest in tokens directly, but you can exchange tokens for Ethereum.

The Ethereum market price hovers around $300, but no one knows what height it may have in the future. Similar projects have began to compete with Ethereum in China, most importantly NEO. But at the beginning of 2017, Ethereum traded below $20, going through phenomenal growth as token sales and initial coin offerings (ICOs) increased their pace.

Ethereum mining has led to a spike in the price of GPU. The stock of NVIDIA, the leading video card producer, has gained from the robust sales.