May 5, 2021, 3:55 am | Read time: 3 minutes
Bitcoin is the most well-known and valuable cryptocurrency in the world. However, there are other currencies that are rapidly increasing in value. This includes Ethereum, which is now worth more than $3,000.
Ethereum keeps rising and rising. The second most important cyber currency has more than quadrupled its value since the beginning of the year, leaving the crypto leader Bitcoin far behind. During the same period, Bitcoin has seen “only” a 100 percent increase.
Origin and Function of Ethereum
Ethereum is younger than Bitcoin. According to media reports, it was launched online by Moscow student Vitalik Buterin in 2015. Bitcoin has been around since 2008.
Similar to the crypto pioneer, there is no central authority that controls, monitors, and stores transactions. This function is performed by the network of all users, the so-called blockchain. All data is checked decentrally and stored in encrypted form there.
Read more: Bitcoin and Blockchain Explained Simply
What Are NFTs and What Do They Have to Do With Crypto?
The Difference Between the Cryptocurrencies Bitcoin and Ethereum
Ethereum Is More Than Digital Money
Ethereum is not just a digital currency. It is a kind of platform through which business processes can be mapped. In digital contracts, known as smart contracts, transfers can be linked to the fulfillment of certain conditions. Quality seals are also conceivable. According to Grayscale, an asset manager specializing in cryptocurrencies, transactions with a volume of twelve billion dollars are currently processed daily via smart contracts and Ethereum.
Currency Ether
The digital currency on this platform is called Ether. A maximum of 18 million new Ether are released to the market each year. Similar to Bitcoin, new digital coins are obtained through “mining.” Users provide computing power for the encryption of transactions and are rewarded in the respective cryptocurrency.
NFTs Are an Ethereum Offshoot
Currently, “Non-Fungible Tokens” – or NFTs – are experiencing a real internet boom. NFTs can be thought of as collectibles, like paintings, stamps, comics – but in digital form. They are a type of cryptocurrency. Unlike Bitcoin, Ether, and others, they are unique. They have a kind of digital signature – similar to the signature of a great artist. This allows the original to always be recognized as the original, even if there are countless similar copies.
NFTs are part of the Ethereum blockchain. Although there are now other blockchains that have introduced NFTs, the Ethereum network remains the largest NFT platform.
Read more about the NFT trend: What Are NFTs and What Do They Have to Do with Crypto?
Always in the Shadow of Bitcoin – Yet Successful
In 2017, Ethereum’s value increased by a good 7,500 percent to over $600, overshadowing even Bitcoin’s market growth. The oldest cyber currency achieved “only” about a 2,000 percent increase at that time.
With material from Reuters.