Ethereum is a form of currency just like USD or even pounds for the British but it is online and it can’t exist in a physical state. When using ethereum, ether exists as the currency that is exchanged while ethereum represent the network over which the trade takes place. The network (ethereum) exist as any other built platform but it’s only available online. The network provides a platform under which users can create software that is decentralized and available to anyone over the world free of charge which is made possible through decentralization.
Applications developed through ethereum are known to be secure than applications through the normal web. Decentralization allows users to access and use the applications without having to pay and prevents greedy developers from selling the software because databases are stored on different locations and change has to be approved by a number of computers before implementing. The database is commonly known as a blockchain where there exist different levels of trust. The data is and can be stored by anyone but to prevent hacking or cases of fraud everyone with their data stored must have a specific password that gives them access to the data.
Ether is a form of cryptocurrency just like bitcoin but the main difference between bitcoin and ether is that ether production is unlimited and there will never come a time that the production will stop while bitcoins will never exceed a certain number. Ether just like ethereum can be lost when one loses heir computer data as a result of the computer crashing or after losing the special key. Ethereum can be stored using offline paper wallets that can be carried from place to place.
The following is the process of how to trade ethereum.
- The first step involves getting an account where the exchange will take place. This is an important step for the exchange but some exchanges like ShapeShift do not require signing up.
- The next and the final step include linking the account with a medium that will facilitate withdrawal of the money like a credit card or using a bank transfer that can take some time.
Advantages of Ethereum.
- Ethereum exists online and it can’t be hacked to change ownership.
- The feature that allows for storing offline for future use can allow for saving.
Disadvantages of Ethereum.
- Ethereum can be lost from computer failures, can be destroyed or even thrown accidentally without the owner’s knowledge.
- In instances of a lost paper wallet, ethereum cannot be recovered or retrieved and great loses can be experienced.
Ether can also be stored using hardware wallets. This exists as small hardware devices connected to computers using the USB ports. They are easy to use, very hard to hack both online and offline, designed to be waterproof and have amazing durability. Hardware wallets can be backed up to avoid loss of money in instances of losing the wallet or even after getting one’s wallet stolen.