Before we jump into learning more about Ethereum, it’s good to know that it’s the 2nd largest cryptocurrency (just next to Bitcoin) as per market cap.
The currency has grown over 2000% since the start of the year. Bitcoin Wiser was early to delve into Ehtereum in the previous year and we are forecasting it to surpass Bitcoin in market cap by 2018. If you’re looking to go in today you can easily short it to $250 or long it to $400 by Diwali but the challenge remains where to buy it from? Cheers to Zebpay they are bringing Ethereum to trade come this August as reported by media a couple of days ago.
While Bitcoin has proved itself (time and again) as a safe haven or rightly titled as digital gold, most of the innovation that are happening in the financial ecosystems around the world are happening on the Ethereum platform. Smart contracts and Blockchain is largely getting clubbed together by big finance companies on the Ethereum platform. Bitcoin Wiser has itself participated in funding a few ideas recently by investing in the innovative ideas built around, or on, Ethereum. So let’s do a quick primer.
A brief look into the functions of Ether and Bitcoin:
For starters, bitcoin was designed to be used as an alternative form of payment for fiat money. Bitcoin was created in the hope that it might one day replace or at the very least be a viable alternative to legal tender. Whether that will actually happen remains to be seen, but what is clear is that bitcoin is meant to be a virtual all-purpose currency.
Ether, on the other hand, could best be described as the internal combustion engine of Ethereum. Ether fuels Ethereum, which among other things has provided a platform for the enforcement of the groundbreaking and ingenious smart contracts that are rapidly becoming a force to be reckoned with in the legal and financial sectors. Ethereum has also enabled developers to build and run distributed applications, also known as ĐApps. These ĐApps have opened up endless possibilities for business models that were previously infeasible or too expensive to run.
Technically speaking, Ether is not currently considered an alternative form of payment since there are no Ether machines to facilitate transactions in brick and mortar stores, or any Ether online payment processors. However, in time this could change. But in terms of differentiating between the two as cryptocurrencies, think of it this way: bitcoin is only a currency within the blockchain network while Ether is a currency that’s mainly focused within the Ethereum system (at this moment). So, while it is true that bitcoin and Ether could possibly both be labeled as parallel currencies after a fashion, they currently serve different purposes.
For instance, a contract can be designed among individuals wanting to bet on cricket if the certain conditions are met. In the corporate sector, a company has signed a contract, fee will be paid using Ethereum after the completion of contract terms.
So if the government and big corporations are so inclined for the Ethereum ecosystem over the Bitcoin Blockchain, one can only wonder what the price will look like at the end of year or the years to come.
We’ll focus more on various aspects of Ethereum in follow up “deep read” articles so don’t forget to revisit Bitcoin Wiser soon!