Bitcoin’s meteoric rise and more recently its phenomenal decline has put a spotlight firmly onto digital currencies, also known as cryptocurrencies. Ethereum, is one of the many now gaining interest as a result. Those who are not familiar with the dynamics of the individual cryptocurrency could mistakenly generalise their purpose based on their similarities. Bitcoin for example is a global financial network whereas Ethereum aims to replace Internet third parties.
Ethereum’s platform is designed to build and run smart contracts. Smart contracts are computer codes that facilitate the exchange of money or anything of value. This technology eliminates the middleman, whilst upholding the rules and penalties of an agreement and enforcing them automatically. These contracts are run on a blockchain network, exactly as programmed, removing the possibility of censorship, downtime, fraud or third party interference.
Ethereum’s use is broad. Industries such as finance, healthcare and governance all use intermediary services that could potentially be replaced by decentralised applications. This would protect data and make exchanges more transparent. Ethereum is a tradable cryptocurrency, Ether, can be mined and used to pay for transaction fees or services on its network.
Blockchain, Ethereum’s database, decentralises applications as its network is hosted on many computers around the world. Every transaction is recorded on every computer and can only be modified if multiple computers agree. The data is stored by everyone but can only be accessed by a special password or private key.
The origins of Ether are after Bitcoin so Ether never reached the same highs as Bitcoin, it still experienced an extraordinary rise across 2017. Ether rallied from just $0.5 to highs above $1400, before descending sharply in 2018. Ether is currently below $1000 following the heavy sell off in cryptocurrencies on Friday.
Where to trade Ether?
Whilst Ether can be traded through crypto exchanges such as Coinbase, Bitstamp, Kraken and Gemini, these exchanges and the use of a wallet leave you open to potential hacks and your coins being stolen. If you are looking to capitalise on the movement of Ether, without the security issues associated to owning the virtual currency, then it could be better to trade without ownership via a broker such as Vantage FX.
Vantage FX is a forex broker based in Australia. They are regulated by the Australian Investment Securities Commission. When trading cryptocurrencies it is really important to make sure you do so through a regulated broker. If you don’t, you are leaving yourself exposed to many potential problems, which will most likely cost you money at then end of the day.
Vantage FX has won many awards for its superior offering and exceptional client service. It also offers its clients the possibility to trade cryptocurrencies through the world renowned MT4 platform.
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