Ethereum: new kid on the block

This year, Bitcoin enthusiasts and investors celebrated the success of world’s most popular cryptocurrency. Instability of the global economy forces investors to look for new ways to hedge against the risk, and the traders are happy to help them and to earn extra money. Everybody recognizes Bitcoin as the most famous cryptocurrency. But does it mean it’s also the most successful one? Statistics show that it isn’t the case.

Alt currency newcomer

Bitcoin without a doubt has had an impressive run in 2017. However, the investors have something to think about. Bitcoins newest rival, Ethereum, has experienced a rise in value of 2000% over the past year. Let’s take a closer look at the altcoin newcomer growing up in the shadow of Bitcoin, and see if he can potentially take its crown.

At first sight, Bitcoin and Ethereum have a lot in common. Both cryptocurrencies use blockchain and their security is based on public decentralized recording of all transactions, which form so called blocks.

But, looking deeper into the competitiors, you will notice significant differences in their design and even their utilization.

Ethereum – a different cryptocurrency

Bitcoin’s main purpose is to be a payment method for consumers. Ethereum offers a wide range of features, making it appealing for corporate clients. The Ethereum project has released its own currency named Ether, but its developers are more focused on everyday transactions and users’ ability to move value around, as well as allowing the business clients close the deals without needing a middle man.

Ethereum’s main feature that attracts corporations so much is the so called smart contract.

How does it work

Basically, smart contract is a computer algorithm that allows the programmers to add the contract and its terms directly to the blockchain. Blockchain functioning is enabled by a large number of decentralized computers within one system. Therefore, both parties signing the contract know that the data cannot be tampered with.

The cryptography specialists made it possible to use blockchain for creating smart contracts, allowing the users to exchange money, property, shares, content or any other assets. Smart contracts not only store the information about the contract and its terms, but also execute it once all conditions are met. This way the clients won’t need the presence of a third party when making a deal. All data stays in the decentralized registers on the Ethereum blockchain, making it impossible for anyone to mess with the contract.

Corporate interest

While Bitcoin gathers a lot of support from its community, Ethereum caught the interest of the global corporations. JPMorgan Chase & Co., Intel Corporation and Microsoft Corporation have been working together to launch the Enterprise Ethereum Alliance. The network is built to allow big companies to work on Ethereum blockchain together.

As of now, Bitcoin market cap is at $40 billions and doubles the cap of Ethereum. However, the investors are excited about the smart contract feauture and believe that Ethereum can be a powerful tool for corporate use.

How to invest in Ethereum?

At this time, the investors have limited opportunities to show their faith in Ethereum. Despite being filed for NYS listing last year, The EtherIndex Ether Trust is yet to be approved by SEC. Let us recall, that Winklevoss Bitcoin ETF wasn’t approved either and is currently being reviewed by SEC. Until the green light is given, american investors are unable to add cryptocurrencies to their investment portfolio.

For now, the only way to invest in Etherium is exchanging Bitcoin for Ether directly via brokerage platforms such as Coinbase. We will keep you up to date on any future developments.

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