Ethereum Coin Explained for Beginners – 2021

What started as blockchain being synonymous with Bitcoin, is no longer the case. The popularity of Ethereum has risen so much over the years that many experts say that it is a better investment than Bitcoin. However, these comments are just opinions and Ethereum is also highly volatile to Bitcoin.

what is ethereum coin

Learn everything you need about the Ethereum coin, its market cap and price prediction for 2021. Understand the good and bad about investing in it. 

What started as blockchain being synonymous with Bitcoin, is no longer the case. The popularity of the Ethereum coin has risen so much over the years that many experts say that it is a better investment than Bitcoin. However, these comments are just opinions and Ethereum coin is also highly volatile to Bitcoin.

What is Ethereum? 

In simple words – Ethereum coin is a digital currency that runs on a blockchain and executes smart contracts. Smart contracts work like how traditional contracts work, that is execute the payment based on the fulfillment of pre-defined criteria. While Bitcoin is digital money, Ethereum is more suited for complex business transactions. 

But here comes a slight twist. Ethereum is the blockchain technology and Ether is the cryptocurrency that operates on it. As an example, consider Ethereum to be the Internet and Ether to be one of the products emerging out of it. Ethereum is used to build a variety of decentralized applications as well. For the sake of discussion, let’s universally mention ‘Ethereum’ throughout this article. 

The Ethereum coin works similar to Bitcoin, that is, you can buy it from a cryptocurrency exchange, do transactions with it, convert it into fiat currencies, and back. You can also invest in Ethereum blockchain just like how you would invest in Bitcoin, and expect the cryptocurrency to grow in value over time. 

The developer of the Ethereum coin blockchain is Vitalik Buterin who created Ethereum with the intention of it serving as the programming language to write applications on the blockchain. They developed Ethereum along the lines of Bitcoin and extended the use case further than just as a cryptocurrency. 

Ethereum Coin Value, Ethereum Market Cap, and Ethereum Price Prediction 2021

At the time of writing, the value of Ethereum coin in INR is 1.92 lakh. 

2021 has been a turbulent year for Ethereum coin value so far (June 2021) with a lot of ups and downs in the prices after reaching many new heights, but the currency has seen a net gain so far. The price of Ethereum in INR at the start of the year was INR 53K approx and then grew steadily until mid-may to reach an all-time high of INR 2.87 Lakh per coin However, due to some recent developments in general in the crypto world, the price has come down of most currencies although they seem to pick up. 

The Ethereum coin market cap at the time of writing is INR 22.312 trillion which ranks it second among the highest market cap cryptocurrencies in the world, behind Bitcoin. 

According to some experts, the Ethereum coin value is set to steadily go in the upward trend growing by 30% of its current value to reach INR 2.55 Lakh per coin by the end of 2021. While crypto is in good demand almost all the time, it is also the leading platform for DeFI and NFT which has been trending in 2021 so far. Therefore, the Ethereum coin prediction 2021 remains optimistic, although things can quickly overturn. 

How The Ethereum Coin Works?

ethereum
ethereum

The Ethereum blockchain fundamentally is very similar to Bitcoin’s. But it is designed in such a way that developers can write software that automatically manages transactions and it’s outcomes. This is called a ‘smart contract’. 

While a traditional contract is written on a piece of paper, the Ethereum smart contract is laid out on a code. Once the conditions are fulfilled, the points mentioned in the Ethereum smart contract get automatically executed. Through smart contracts, one can keep the deal completely transparent, avoid delays and fully automate the process without the need for human intervention repeatedly. The use of smart contracts built on Ethereum is slowly making its presence in property, insurance, financial services, legal and crowdfunding applications. 

Smart contracts have some benefits – there will no longer be the need for a middleman. It gives the user 100% control and there are savings in the cost as well. Since the smart contracts are on the blockchain, it is safe, secure and can be viewed by all relevant to the contract. Lastly, the time and effort to process manual documents are reduced. 

Also Read: The Ultimate Guide About Bitcoin

Ethereum vs Ethereum Classic – What’s the Difference?

Ethereum is a hard fork of the Ethereum Classic. A hard fork as opposed to a soft fork involves the division of the software into two versions and the user cannot opt for the older method once they switch to the newer community and versions. 

Ethereum Classic is abbreviated as ETC. 

One key difference between ETH, ETC is the thought process. For instance, Ethereum does not agree with the fact that the blockchain is immutable. People who believe it is immutable believe that people should not be allowed to create alterations in the blockchain as this can lead to corruption. 

ETC was created out of an attack on the DAO in December 2016. Once the Ethereum had been stolen, there were heated debates within the Ethereum community on what to do next to solve the issue. While some argued that the blockchain should not be tampered with since it is immutable, some stood for it. 

But they went with the hard fork to be able to refund all the lost money to the users. The new version came to be known as Ethereum (ETH) and the old one was called Ethereum Classic (ETC). 

Difference in Value 

The value of ETH at the time of writing is way more than ETC. ETH has investments and support from a big group of crypto-enthusiasts and the development team is highly active for new updates etc. 

Outlook For the Future

Many people believe that the time for Ethereum Classic is done. This is significantly attributed to the poor impression of the team running it. On the opposite end, Ethereum has been actively competing against Bitcoin and is growing at a rapid pace in terms of everyday value and market cap (second after Bitcoin currently). 

Difference in Features 

ETH has the strong support of the Enterprise Ethereum Alliance which contains more than 200 companies, some of them belonging to the Fortune 500 group as well, who use Ethereum for building smart contracts. These companies include JP Morgan, Microsoft, Toyota, etc. In terms of smart contracts features and development, ETC lags a lot behind and thus, does not have commercial backing as much. 

Is The Ethereum Coin Good or Bad?

Let’s look at both sides of the Ethereum coin and see if it makes a worthwhile investment (or even consideration for an investment)

Good side of Ethereum Coin:

One of the biggest decentralized currencies in the world:

After Bitcoin, it has consistently been the most decentralized and popular cryptos in the world. Although certain organizations and influential people are backing it, the authority does not rest with anyone or any one entity. This provides high security against interference and corruption. 

Active Developer Community:

The community is one of the largest in the world and is highly active and well-knit. The developer community is larger than Bitcoin. Since blockchain technology is still new, the large developer community helps to effectively find solutions to the biggest problems in the world. 

Large Product Collection:

As mentioned earlier, Ethereum is the platform on which hundreds of other products are built. Therefore, it connects well with this product base. So, if you are expanding your investments and effort in the crypto space, the route through Ethereum is one of the most exciting ones. 

Cons of Ethereum Coin

Speed is a Little Slow:

With this also comes increased transaction fees. The speed of Ethereum is in the range of 15 transactions per second. A slightly complex Ethereum smart contract may cost anywhere between $50 to $100 to execute. People using Ethereum constantly complain about the high platform fees and high traffic. 

Complicated for Beginners:

It’s just now that enough tutorials and guides are being built for beginners to get started with the Ethereum blockchain. Since it acts as a programming language and is not a straightforward cryptocurrency, the technical details can get a little overwhelming for beginners, especially those not used to being in the crypto space. 

Difficulties in Programming:

Developers who want to build products on Ethereum blockchain need to code on Solidify. The programming language is unfamiliar to many, and difficulty may cause the programmers to write contracts with vulnerabilities. These can be risky for execution as the vulnerabilities may be hacked. 

Conclusion 

The Ethereum coin is an exciting crypto market. If you are new and want to get your hands in crypto, Ethereum is one of the best places to start. Do follow the community on Twitter and various Ethereum enthusiasts groups on different social media platforms for more relevant insights and news. These help a lot in understanding the cryptocurrency platform better.