When most people think about cryptocurrencies, they are likely thinking about Bitcoin. The vast majority associate crypto with Bitcoin, as it is the cryptocurrency with the most significant market share and financial presence in the United States.
Despite Bitcoin being very popular, it is not the only cryptocurrency in circulation. There are hundreds of cryptocurrencies, but very few are worth the attention of investors or traders. One of those currencies is Ethereum.
If you buy eth as a day trader, you can expect ample opportunities to make money. The price of this cryptocurrency does fluctuate periodically, ensuring plenty of chances to profit.
Below is an in-depth guide that explains the most important facts about Ethereum that everyone should know.
Ethereum Is Now More Efficient
One of the most common complaints that have been levied against Ethereum, when compared to other cryptocurrencies, is its lack of efficiency. Mining the cryptocurrency does require a lot of resources, which can mean that attempting to gather more Ethereum this way is often counterproductive for the average person.
The latest update, which was completed in September of 2022, has ensured that this crypto is now on a more efficient proof of stake mining protocol. That means the way that transactions are verified and general mining of Ethereum is handled will be around 99.95% more energy efficient compared to before.
Such a figure is an impressive achievement and does bode well for the future of this cryptocurrency.
Transaction Time Concerns
Another concern with respect to Ethereum relates to the time it takes to complete a transaction. The present statistics show that ETH can manage over 14 transactions per second, which is significantly worse than many other cryptocurrencies.
Two of the most impressive examples in this regard would be Cardano and Solana, which can average 250 transactions per second and 65,000 transactions per second, respectively.
Ethereum developers are working hard to bring an update to improve transaction time, but that is a concern at present. People who are using this currency as a trading commodity may not have a significant issue, as they do not need to access their funds instantly. However, the slow transaction time can represent issues when using this cryptocurrency in place of regular currency or Bitcoin.
Ethereum Ranks Only Behind Bitcoin
In terms of the market capitalization of cryptocurrencies, Ethereum is in a very impressive position. At present, only Bitcoin has a higher market cap compared to Ethereum.
As of the start of 2022, there was a circulating supply of around 120 million ETH, which makes it the second largest cryptocurrency behind Bitcoin. Even though Bitcoin does have a commanding lead in this regard, Ethereum can catch up in time.
One of the advantages of this crypto is that it does not have a limit. While Bitcoin and some other cryptocurrencies have a finite supply, Ethereum can be mined continuously, which means that it can eventually reach a market cap that is even higher than Bitcoin.
Improved Hack Protection
As Ethereum grew over the past few years, so did the issues that emerged as a result of nefarious activity. While the vast majority of people who use ETH will never have a negative experience, there were a few examples of hacks that took place in 2021.
The positive news for this and other cryptocurrency followers is that such hacks may be in the past. Significant steps were taken by developers to protect Ethereum and anyone who uses it for transactions or trading.
There is also likely to be more significant regulation of Ethereum and other cryptocurrencies in the United States in late 2022 and early 2023.
Investing in Crypto as a Beginner
One of the interesting aspects of cryptocurrency for many people is the investment opportunity. Even if you are not planning to mine crypto, you can still make a passive income by knowing the ideal times to buy and sell Ethereum, Bitcoin, or other currencies.
Investing in crypto as a beginner is extremely appealing, but you must do your research beforehand. Ensure you are aware of how and when cryptocurrencies are most likely to fluctuate and what economic events can drive their prices up and down.