Ethereum (ETH), which is a decentralized software platform that enables Smart Contracts and Distributed Applications to be built and run without any downtime, fraud, control or interference from a third party, is one of the best alternatives to Bitcoin. Ethereum has a market capitalization of $41.4 billion, second to Bitcoin among all the cryptocurrencies.

Both Bitcoin and Ethereum are distributed public blockchain networks, and, obviously, have some similarities. There are also many differences between the two. The most important difference is their purpose and capability. Bitcoin offers one particular application of blockchain technology, a peer to peer electronic cash system that enables online Bitcoin payments. While the Bitcoin blockchain is used to track ownership of digital currency (bitcoins), the Ethereum blockchain focuses on running the programming code of any decentralized application. The more apps are built, the more valuable Ether becomes (a type of crypto token that fuels the network). In the Ethereum blockchain, instead of mining for bitcoin, miners work to earn Ether. Aside from its tradable cryptocurrency feature, Ether is also used by application developers to pay for transaction fees and services on the Ethereum network.

Forecasts of the Ethereum price in 2018 are based on 3 factors. The first is the current and future Ethereum supply. Currently there are 96 million units, and although there is expected to be some increase in the future, developers in charge of Ethereum will make sure that the number of circulating coins stays constant.

The second factor that will affect Ethereum’s price is its use of decentralized apps, mentioned above. Some researchers expect that 5 to 7 years from now we will see a big increase in the number of decentralized blockchain apps.

The third factor is demand, which will be driven by its functionality. The technology behind smart contracts is what interests people most.

It should be noted that the price of a single Ether is very volatile, so it’s hard to make predictions about value. Bearing in mind these 3 factors, there is a good chance for an increase in value.

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Posted by Min Park

Blockchain Marketing Consultant

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