Is Ethereum an efficient cryptocurrency?
Bitcoin seems to have taken the limelight away from other cryptocurrencies. But, the reality shows the opposite, there are many interesting projects. One of them is Ethereum, which in fact shares popularity with the precursor digital currency.
This cryptocurrency was launched in 2015 and currently ranks among the top in market capitalization. Therefore, in this cryptocurrency overview, we will talk about what Ethereum is and what its success is due to.
What is Ethereum?
Ethereum is considered one of the most innovative digital currencies in the world. It has not only revolutionized the ecosystem for buying cryptocurrencies, but also the way we perform some everyday financial activities.
The Ethereum network was created by taking the system behind Bitcoin and transforming it into a technology that provided new possibilities for use. The blockchain designed by its developer, Vitalik Buterin, allows decentralized applications to be built.
Advanced investment systems can be molded from scratch. In addition, Ethereum is the first network to implement the Smart Contract concept. This system provides the opportunity to make contracts of any kind supported by the security of the blockchain.
How does Ethereum work?
The principle of operation of Ethereum is in an algorithm with consensus protocol Proof of Work or PoW. These systems build the tokens that allow the cryptocurrency to be inserted into blockchains.
The algorithm it uses is called Ethash and has been designed to be very demanding on the machines dedicated to mining. It has incorporated the Keccak hash function better known as SHA-3.
Thanks to this special feature, the algorithm seeks to produce cryptographic codes with high-security standards. Additionally, Ethash is programmed to consume a huge amount of cache and memory in order to avoid centralized mining. The features above have been configured to increase the difficulty for ASIC machines.
Advantages of using Ethereum
The creation of Ethereum coins, as well as the exchange of cryptocurrencies of this type, is a success. We have seen how Ethereum offers a product that goes beyond cryptocurrencies. So it manifests a sea of advantages among which we can mention:
Decentralized currencies: since assets can be created without intermediaries, the costs related to the involvement of an external subject are reduced. Likewise, the risk of a third party modifying the software with malicious intentions is ruled out.
Contractual security: Smart Contracts make it possible to agree on actions enforced in response to customized clauses in the blockchain.
Ethereum Virtual Machine: is software that generates an isolated environment where applications are executed. The VM provides an extra layer of security by making a hidden abstraction place from possible attacks and facilitates programming.
Operational speed: it has the capacity to produce blocks with astonishing speed. This implies that its transactions are faster than the Bitcoin network and other similar cryptocurrencies.
Efficient exchange: it can work on different platforms. It allows you to buy, exchange ETH for BNB.
Ethereum vs. other cryptocurrencies.
Although Ethereum emerged from the same basic technology as Bitcoin, they are diametrically different in the following aspects:
While Bitcoin and other cryptocurrencies have focused on increasing trust in digital currency, Ethereum is a multipurpose network. It aims to broaden the horizon of blockchain usage with Smart Contracts and Dapps.
Most systems have a timeout that can be as long as 10 minutes. Ethereum is a fast blockchain, processing transactions in a matter of seconds.
Compared to other cryptocurrencies with Proof of Work mining mode, Ethereum’s algorithm is more challenging for machines. This ensures sustainable decentralized mining over time.
An important difference between Bitcoin and other digital currencies is that Ethereum is Turing complete. In simple terms, this means that the network has the ability to execute any computation as long as the computer has sufficient computational power.
Ethereum news
The famous Twitter user hidden behind the pseudonym Jhon Wick claimed after a chart analysis that an uptrend of the currency is expected by 2022. There is an expectation that both the exchange of cryptocurrencies in Spain and other countries will reach historic highs.
In this sense, a market of much expectation to buy cryptocurrencies is on the horizon. Which is an indication to start investing in Ethereum.
In short, this currency is an asset in constant growth. It has gained a wide international clientele. More and more people are becoming interested in it and, according to the analysis of specialists, it will be a product that will soon have great international repercussions.