Ethereum is a comparatively new cryptocurrency. It is also an open computing platform founded on blockchain technology. This allows developers to build and use decentralized applications. Similar to Bitcoin, Ethereum is a distributed public blockchain network. However, Bitcoin and Ethereum vary significantly in the purpose they serve. The Bitcoin blockchain essentially tracks who owns the digital currency (bitcoins), but the Ethereum blockchain runs the programming code of any decentralized application.read more
Blockchain technology is a certain way of recording and confirming transactions. In this method, instead of a centralised platform, each of the participants have a complete record of the transactions achieved through a peer-to-peer verification of the transactions. Hence, there is no central recording system but it is up to each participant to keep a record of the transactions made. This system is also followed while operating Bitcoin with no central body.read more
At the outset, Ripple (XRP) and Stellar Lumens (XLM) appear to be similar as they have similar technical functionalities. Both operate underlying payment processing solutions with native assets and are founded by Jed McCaleb. Both networks also support tokens representing crypto currency, fiat currency or any other unit of value such as mobile minutes or frequent flier miles. They are separately based on a shared, public database or ledger which uses a consensus process that facilitates exchanges, payments and remittances in a distributed process.
However, on a closer look, there are significant differences between the two.
An Initial Coin Offering or ICO is a fundraising mechanism which is similar in concept to an Initial Public offering, also known as IPO where both are basically processes by which companies raise capital.
While an IPO investment deals with issuance of securities where investors get to purchase shares of a company, an ICO is an investment that gives an investor a crypto coin in return for investment. This primarily means that someone can offer investors some units of cryptocurrency or crypto-tokens in exchange of either Bitcoin or Ethereum, that the investor already has in his or her possession.
In today’s world, cryptocurrencies have become a central topic of interest partly due to the extreme volatility of Bitcoin, the flagship cryptocurrency. Apart from buying and selling cryptocurrencies, consumers are actively involved in cryptomining, which is the process of new digital currency creation.
The system essentially relies on a network of peers – hundreds of computers – to audit each transaction. This means that the network of computers has to agree that a transaction is legitimate before it’s deemed a “block” and added to the blockchain.