How Ethereum works
Are you curious about Ethereum (ETH) and how it works? Whether you want to trade, buy, or mine it, understanding the basics is essential. Ethereum is a cryptocurrency that is closely tied to the Ethereum platform that created it.
So, how does the platform work? Think of it as a massive “computer” made up of a network of PCs that work together to power its daily operations. Similar to Bitcoin, the network uses blockchain technology. However, Ethereum’s platform isn’t solely focused on payment management. Its purpose is also to develop decentralized applications called “smart contracts.” These applications are not controlled by third parties and are resistant to censorship and fraud.
When it comes to Ethereum’s digital currency, it is derived from ether. Ether is a means of payment for the computing resources that users need to run applications on the Ethereum network. Developers also use ether to build their applications and smart contracts. But how does ETH work in real-life cases like buying goods and services? Simply put, it will work as long as the merchant accepts it as a form of payment.
Now, let’s talk about how to use Ethereum. Like any other cryptocurrency, you can mine it, store it in your wallet, or trade it on exchanges for profit. If you’re not using it to create or run applications on the Ethereum network or buy things, the best option is to buy and sell it on exchanges to try and profit from changes in its prices.