Ether is a virtual currency designed to operate smart contracts on the larger ethereum network. In layman terms, Ethereum is a computing network where participating nodes are compensated with ether for computations performed. In terms of market capitalization, Ethereum is the second largest crypto currency only after Bitcoin.
Over a few months, Ethereum has steadily grown from a behind-the curtain crypto to a serious contender for the title of the most widely-used cryptocurrency. In terms of functionality, Ethereum functions the same as Bitcoin and this begs the question, is Ethereum similar to Bitcoin?
Well, Ethereum is similar to Bitcoin to an extent. For instance, they both use the open source blockchain technologies. Both crypto currencies can be described as public blockchain networks. However, it is worth noting that they are distinctly different in some aspects. Ether is a crypto token that somehow fuels the network; used to pay miners and as a tradable virtual currency. Bitcoin on the other hand is a peer to peer payment system.
Buying Ether is a straightforward process which even beginners can easily accomplish. First, you have to access a platform over which you can exchange conventional cash with Ethereum; an exchange or an online broker will do just fine. After registering with a broker or an exchange, you can buy Ethereum instantly.
However, it should be worth noting that almost all brokers will require you to pass several identity verification checks to be granted full access to the trading platform. The identity checks work as safeguards against fraud-related payments. Once you have access to the trading platform, you have to make a deposit to your trading account before exchanging the deposited funds with equivalent of Ethereum. Sounds simple, right?
Similar to Bitcoin, Ethereum has a wide array of uses. As mentioned earlier, ether is a token used to compensate miners for computations completed. Ether can also be used as any conventional currency in online shopping as long as it is accepted by an online merchant. Paying via ether guarantees anonymity but is imperative to note that transactions are always visible on blockchain network to all participants. Some online casinos accept ether as a deposit currency and hence facilitates anonymous online gaming.
Ethereum is more secure than other cryptocurrencies. Currently, the Ethereum network is proof of work (PoW) based but with future intention of migrating to proof of stake (PoS) system which will make it even more secure. As it currently stands, Ethereum is not only superior security wise but it can also handle more transactions compared to Bitcoin.
The Blockchain is a shared ledger technology which is revolutionary in every aspect. Simply put, the blockchain is a digital ledger on which anything can be recorded and distrubted through a network of people. The Ethereum blockchain is a ledger where all Ether transactions are recorded. Anyone can access The Ethereum Blockchain and can view transactions made by specific addresses - but not who is behind those addresses. Blockchain technologies are especially popular in the cryptocurrency world because of their decentralised and private nature.