What Is Ethereum?

Since its inception in 2009, Bitcoin has been the subject of intense curiosity for many people. One of those was Vitalik Buterin, a developer who eventually co-founded Ethereum, with its live blockchain initially launched in 2015. A steady growth in the Ethereum price, positive market cap, and trade volume have made Ethereum a force to be reckoned with in the crypto industry. Buterin built Ethereum on top of the groundbreaking work of Bitcoin with significant modifications. Both let you utilise virtual currency independently of traditional financial institutions. However, since Ethereum can be programmed, it can also host the development and distribution of decentralised apps.

Let’s Start From The Basics

Ethereum is a public, distributed, open-source platform based on blockchain technology that features its own cryptocurrency, Ether, and a programming language, Solidity. It permits the creation of DApps and supports smart contracts. These are agreements between two parties written into a computer program and run when a particular condition is met via blockchain technology.

The History Of Ethereum

In a proposal published in 2013, Ethereum was initially outlined by cryptocurrency researcher Vitalik Buterin. He suggested integrating a programming scripting language into Bitcoin. Buterin first proposed the concept of the blockchain project, of which Ethereum was a part, during a Bitcoin convention in Miami, Florida, in the early months of 2014. In the fall of the same year, the team behind the project staged an initial coin offering (ICO) to generate capital for its development. The crowd-funding resulted in selling millions of dollars worth of Ether, and the project went live on July 30, 2015.

How Does Ethereum Work?

Ethereum is built on a blockchain-based system and for many years was minted using the Proof of Work (PoW) mining process – similar to that used by Bitcoin. In September 2022, Ethereum switched to Proof of Stake (PoS), an upgrade that addresses many of the environmental concerns associated with PoW – and also designed to make the network more secure and resilient.

Ethereum reaches consensus on the state of its ledger through the PoS consensus algorithm. In proof of stake, the next block producer is chosen based on their stake in the network, meaning the more Ethereum a user holds, the more likely they are to be chosen to produce the next block. This is in contrast to proof of work, where the next block producer is chosen based on their ability to solve a computationally difficult problem.

Proof of stake has several potential advantages over proof of work. Because users are chosen to produce blocks based on their stake in the network, there is no need for them to perform the computationally difficult work required by proof of work. This means that reaching consensus on the blockchain can be more efficient and require less energy. Additionally, because users with a larger stake in the network are more likely to be chosen to produce blocks, they have a stronger incentive to act in the best interests of the network and maintain the integrity of the blockchain.

How To Buy Ethereum?

With a market capitalisation of over $150 billion, Ethereum is the second leading form of cryptocurrency supported by leading businesses. Here is how you can use or purchase this cryptocurrency:

Select A Trading Platform

Creating an account on a cryptocurrency exchange that facilitates the exchange of fiat currency for cryptocurrencies like Ethereum can be the starting point. Most platforms offer a user-friendly purchase interface and a wallet to hold your investments.

Deposit Money Into Your Account

You’ll need to add funds to your account at your chosen cryptocurrency exchange before you can buy Ethereum with it. Deposits can typically be made via a bank account, such as a checking or savings account, a debit card, or PayPal.

Purchase And Withdrawal

Following account verification and the deposit of funds, you will be able to buy Ethereum, the proceeds of which can be transferred to a bank account or wallet of your choosing. Many new users get started by trading Ethereum on Binance.

3 Use Cases For Ethereum

There are many advantages to making purchases using Ethereum, and the prospect of a decentralised society in which Ethereum is the standard method of exchange is fast becoming a reality. To get the most out of your Ethereum holdings without selling, you can consider the following strategies:

Shop On Amazon

The most popular e-commerce platform now accepts Ethereum payments through Bitpay. The app has several advantages over using an online exchange because it can be used as an Ethereum wallet on multiple platforms facilitating seamless transactions across Amazon.

Pay With Ethereum Via Paypal

If a store accepts PayPal as payment, all you have to do to spend Ethereum is choose "Checkout with Crypto" when requested at the point of purchase.

Book Your Next Trip With Ethereum

With Travala, the most popular Ethereum-based blockchain platform for booking travel, you can easily arrange your next vacation. Since its inception in 2017, the firm has amassed a portfolio of over 2 million residences in 230 different nations. So, no matter where you plan on globe-trotting, you can pay for your trip costs quickly and easily using Ethereum through Travala.

Editorial Note: This is a sponsored article. Opinions expressed are those of the sponsor and readers should conduct their own due diligence before taking any action based on information presented in this article.