If you've researched crypto, you've come across Ethereum. Many traders believe the well-known, respected cryptocurrency will outlast Bitcoin.
Ethereum is right behind Bitcoin regarding its value and liquidity. It was created for a much "bigger" purpose, unlike Bitcoin, and the idea is even utopian. There are many exciting facts about facts, and some of them you should know if you want to start trading Ethereum. Let's go!
The idea behind it
Vitalik Buterin is a person standing behind the creation of Ethereum. Etherum started as a project that was focusing on dapps (decentralized apps). While Bitcoin was working hard on the blockchain technology, Buterin wanted to take it further - a space where everyone can develop their apps based on blockchain technology. That's how the Ethereum project started, and Ether (the cryptocurrency) was created. Bitcoin and its technology might be a huge inspiration, but what Ethereum brought is a microeconomy that spread worldwide.
Is Ethereum profitable?
Alongside Bitcoin, Ethereum is the most popular currency, but the difference is significant. You can't have the same strategy for trading Bitcoin and Ethereum. It's vital to know what you need to gain an advantage when trading. You should always pay attention to liquidity and volatility, which is very high for both Bitcoin and Ethereum. Like we mentioned earlier, Ethereum operates differently from Bitcoin, meaning they are decentralized software. This means that smart contracts exist thanks to this, and many people eagerly invest in Ethereum every day.
What Ethereum guarantees?
Ethereum is famous for its fundraising. The money stays in their fund until the end of the fundraisings, and what Ethereum guarantees you is that if you are a user who needs finances and there is someone who wants to help you to develop a project, they will not lose what they invested. This means that if the projects fail, the money goes back to the ones who were investors.
What are the other advantages?
The simple answer is yes. Like with bitcoin, you can pay for certain things. Still, traders will instead wait for their price to rise or fall because of volatility and chances to profit. Also, mining (making) of Ethereum takes a lot less than bitcoin, meaning it can mine more coins. For example, you can mine an Ether in 15 seconds, while mining one Bitcoin can take up to ten minutes. While you need hefty equipment for Bitcoin mining, mining Ethereum is possible on regular computers, meaning it costs far less. Please consider that Bitcoin supply is limited, and while Ethereum limitation also exists, it narrows down to 18 thousand per year.
Liquidity and Volatility
When it comes to liquidity, Bitcoin leads by 17 billion daily turnovers more than Ethereum. Still, both cryptocurrencies have high liquidity, so it's far from wrong if you choose to trade Ethereum rather than Bitcoin. In terms of volatility, whatever happens, Bitcoins seems to recover quicker than Ethereum. Still, ethereum appears to stay on track, keeping volatility high despite all the hindrances, with 13% volatility. Keep in mind that, while Bitcoin managed to recover a couple of times this year faster than Ether, during the 4th time, Ethereum doubled percentage growth in comparison to Bitcoin's.
Investing in Ethereum is a good choice since both Bitcoin and Ethereum are very respected currencies and keep attracting investors and traders. If you choose Ethereum, you're not selecting the "worse" option. It all depends on your personal preference. It is also handy that Ethereum doesn't have a limit of 21 million, and it can be produced much quicker. It's worth mentioning that project Ethereum was created to offer multiple opportunities to people worldwide, all decentralized. That is to name a couple of reasons why people like investing in Ethereum so much.
Disclaimer: information contained herein is provided without considering your personal circumstances, therefore should not be construed as financial advice, investment recommendation or an offer of, or solicitation for, any transactions in cryptocurrencies.
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Ethereum is right behind Bitcoin regarding its value and liquidity. It was […]