While Bitcoin is getting all the love these days, another very strong cryptocurrency is flying under the radar. The second most valuable cryptocurrency is Ethereum and it can do things that Bitcoin can only dream of.
Though the value is not nearly as high as Bitcoin, Ethereum is leading the way as far as what the technology behind the cryptocurrency is capable of doing. It’s still an attractive investment as its value continues to spike alongside Bitcoin, but if you don’t already know, there are other benefits to using ETH. In this article, we will go over what some of those benefits are so you can decide for yourself if it is the right cryptocurrency for your portfolio.
Real world utility
It’s true that now you can use Bitcoin as a payment method and it is getting adopted more and more over time. In fact, just recently Elon Musk announced that Tesla bought 1.5 billion dollars in Bitcoin and would start accepting it as a payment method for their cars.
But, many people still just use it to buy and trade for profit. It could be because it is so valuable right now that people don’t really want to part with it from their safe Bitcoin wallet. Or it could be that the transaction speed is slow compared to other cryptocurrency. Lastly, the blockchain doesn’t allow for much else besides acting as a ledger for transactions.
Ethereum on the other hand has a very robust blockchain that does a multitude of things beyond just registering transactions. Decentralized applications, or dapps, can be built onto it so the blockchain uses the currency as the fuel to pay for all of the transactions on the blockchain. It is its own self-contained ecosystem in which a store, casino, insurance company or any other type of activity can be built upon it and ETH is what propels the whole thing.
This gives an actual value to the currency as it is useful in many ways. Imagine that you have a business that requires signatures on sensitive documents from another part of the world. Using smart contracts, these documents can be verified anywhere that your business is regardless of where those documents were signed. The Ethereum blockchain makes that possible. If you have some artwork that is up for sale, the provenance can be viewed with timestamps that cannot be manipulated. The list of possibilities are endless and the glue is Ether.
It is secure and fast
Because the blockchain it is on is able to grow with many modules spiking out of it, it is much more scalable than Bitcoin. Used as a currency, the transactions are very fast and extremely secure.
In fact, it will become even faster as the way to verify transactions will move from Proof of Work to Proof of Stake which is a much more flexible way to encrypt the blocks.
Once this is done then there is a lot more room for growth. All of this utility adds up to a system that proves its worth and contributes to the rise in value. It may not reach Bitcoin levels, but it is a good candidate for longevity.
*This article has been contributed on behalf of Paxful. However, the information provided herein is not and is not intended to be, investment, financial, or other advice.