What is Ethereum and how does it work? | Investment
Ether can be used to buy and sell goods and services, like Bitcoin. It has also seen rapid price gains in recent years, making it a de facto speculative investment. But what’s unique about Ethereum is that users can build applications that “run” on the blockchain like software “run” on a computer. These applications can store and transfer personal data or handle complex financial transactions.
“Ethereum is different from Bitcoin in that the network can perform calculations as part of the mining process,” says Ken Fromm, director of education and development at the Enterprise Ethereum Alliance. “This core computational capability transforms a store of value and medium of exchange into a decentralized global IT engine and openly verifiable data store.”
Ether and Ethereum: what’s the difference?
You can use Ether as a digital currency in financial transactions, as an investment, or as a store of value. Ethereum is the blockchain network on which Ether is owned and traded. As mentioned above, however, this network offers a variety of other functions besides ETH.
“These can be simple movements of funds, but they can also be complex transactions ranging from swapping assets to taking out loans to acquiring a digital work of art.” , explains Boaz Avital, product manager at Anchorage. Transactions are processed and stored on the Ethereum network.