One of the top-5 cryptocurrencies in terms of market capitalization is Ethereum. Ethereum has been following Bitcoin for a long time. ETH may eventually surpass Bitcoin, but at the same time it is much cheaper than Bitcoin, so it is highly appealing to investors. It is possible to make significant profits from Ethereum’s high volatility if you apply the right trading strategies. Here’s how you can limit losses and increase profits from ETH Futures Trading.
What Is Ethereum?
It may be confusing for you to understand what Ethereum is if you are a new trader. You should be aware of the major points when dealing with Ethereum. Ethereum is an open-source blockchain with its own Ether (ETH) cryptocurrency. As a ETH Trading Platform for hosting other cryptos through the ERC-20 compatibility standard and executing smart contracts, Ethereum is a popular platform for digital currencies, global payments, and apps, according to its website.
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The cryptocurrency market first heard about Ethereum in 2013 when Vitalik Buterin, a well-known name for crypto enthusiasts, and his partners released a whitepaper. In summer 2014, Ethereum’s initial coin offering was held at a price of $0.311, meaning Ethereum provided a 270% annualized return on investment.
Since July 2015, the Ethereum network has been updated several times to become a global platform for decentralized applications so that people around the world can run software without censorship, downtime, or fraud.
As a native cryptocurrency of the Ethereum blockchain, ETH, Ether, or Ethereum is used to pay fees when using the Ethereum network. It is a payment received by miners in exchange for processing and verifying what you do on the blockchain. Miners are also rewarded with newly-issued ETHs as rewards.
You can use ETH as collateral to create other cryptocurrency tokens. It can be used to borrow, lend, and earn interest on ETH-backed tokens. ETH is used to secure the Ethereum network as a collateral. The most interesting feature of ETH in this article is that it can be traded with other tokens and fiat money. ETH enables users to pay and receive funds in real time, so streaming ETH.
Why Is Ethereum Unique?
As the first blockchain-based smart contract platform, Ethereum technology introduced the concept of smart contracts. Computer programs are used to execute actions needed for the provision of online agreements between parties. By eliminating trusted intermediaries, the technology aims to reduce transaction costs and increase transaction reliability.
The Ethereum network has created a digital economy and has created new ways to earn online. To use the Ethereum network, you only need an internet connection.
Most of the top-100 cryptocurrencies by market cap are based on the ERC-20 standard, which is hosted on the Ethereum blockchain.
Differences between Ethereum and Bitcoin
We will discuss the factors that affect the Ethereum price in the next block. One of the key factors that affect the Ethereum price will be support. Thus, it is crucial to understand how many Ethereum tokens are available. The Ethereum supply is unlimited, whereas the BTC supply is capped at 21,000,000.
As Ethereum is just an additional way to use a blockchain that supports the Bitcoin network, it wasn’t intended to compete with Bitcoin. Despite this, Ethereum’s market capitalization skyrocketed as it expanded into many popular areas, such as DeFi apps, NFTs, games, and technology. This made it one of the most popular cryptocurrencies, particularly among traders.
The purpose of each cryptocurrency is also different. While Bitcoin serves as an alternative payment method and replaces national currencies, Ethereum was launched as a platform for programmatic contracts and applications.
In 2022, Ethereum is expected to move to the proof-of-stake protocol from the proof-of-work protocol that is used by both Bitcoin and Ethereum. Therefore, Ethereum will be more secure, sustainable, and scalable than Bitcoin. Additionally, Ethereum mining will consume less power thanks to the proof-of-stake protocol.
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