What is Ether Used For?
When it comes to the world of digital currency, one of the words that you usually hear is “ether.” When we say Ether, we are referring to one of the important elements present in the Ethereum blockchain. It is also considered as the fuel of the said network. This is also the one that makes the Ethereum blockchain functional and agile. Some people think that Ether comes from Ethereum as its digital currency. But instead, Ether works as the mode of payment or form of incentive to pay the network users. These users need to pay Ether for them to process their requested network operations.
The Ethereum is the one that supports the running and building of decentralized and digital applications. This is also called as the dApps that is being used for personal or business purposes. When a developer creates his own Ethereum apps, he is required to comply with the amount needed in executing and hosting his apps. On the other hand, a user who will use the created application is also required to pay some amount for the app usage.
Aside from that, Ether also works like a mode that will enable the transactions of payments to be processed. A person who develops his own applications that only uses fewer resources of the network will be paid with lower Ether. On the other hand, if a person builds his own app with higher resources, he will earn more amount of Ether.
Ether – The Fuel of the Ethereum Network
There are lots of people who define Ether as the fuel of the Ethereum network. Many of its users believe that it is a fuel and not a currency. An app is similar to an engine, and Ether is similar to fuel. For instance, an inefficient app or engine will ask you to have more Ether or fuel to work. On the other hand, an efficient app or engine will only need less amount of Ether or fuel.
The usage of Ether in a decentralized application, or on the Ethereum, will always vary upon the computed time and power used by a transaction, request, and process. This only means that if an app used more time and power, the needed amount of Ether to make the action complete is higher. This kind of mechanism is very different compared to the mechanisms used for a standard cryptocurrency.
With the use of Ether, you can now perform smart contracts and apps usage and transaction on the Ethereum. As a result, many users will find it easier when it comes to using, executing, hosting, and building a decentralized application. Aside from that, network participants will also be rewarded or get paid in the Ethereum ecosystem.
Every year, Ether only produces a limited amount of ethers at 18 million only. Following the presale that happened way back in 2014, there are 60 million ethers that were allocated and created for the presale contributors. Aside from that, there are also 12 million ethers that are specifically created for the development funds, which include the Ethereum Foundation, the early developers and contributors.
Currently, each block creates a minimum of 5 ethers. This can be done within 15 seconds. These 5 ethers will then be paid for the block miners. There are about 2 ethers or 3 that are being allocated to other miners who answered correctly.
What is Ether? And What is it Used For?
As we mentioned a while ago, Ether is the one that is being used to power up the Ethereum blockchain. But it has a quite different work with the purpose given by bitcoin to the Bitcoin blockchain. Even though you can see lots of Ether being traded on the market and has a price rate that is the same to bitcoin, but when it comes to its design, the two cryptocurrencies are widely different.
Ether is designed to be the gas or the fuel to make the Ethereum network works. It is not meant to be a currency that can be used to perform the peer-to-peer payment.
On the other hand, Ethereum is also defined as open-source software that supports smart contracts. A smart contract that is running on a blockchain will tend to be a self-executing one when their requirements have complied. The use of a smart contract needs a computational resource that should be paid. You can use the ether cryptocurrency in paying the computational resources.
Ether is considered to be the fuel, similar to the other cryptocurrencies out there that support the running of different smart contracts. It will offer you with the incentives that will help you to validate the different blocks present on the Ethereum blockchain. These were also the ones that come with the codes for smart contracts.
For each block that is being validated, there are five pieces of ethers that are being created. These ethers will then be given to those successful nodes. Each block is being propagated within 15 seconds to 17 seconds. There are other nodes that can search the right answer to the block even though it is not inside the Ethereum network. The said network will provide those nodes a reward of two ethers to three ethers.
The network users who are using the decentralized apps on the Ethereum network are required to comply with the exact payment of Ether for using the network. The creators of these apps are incentivized to develop these kinds of dApps. This is mainly because the network users are paying them as an exchange for their work.
Aside from that, the creators are also being incentivized in writing top-notch apps. This is mainly because if an app is useless, it will cost more expensive. Not only that, but users also will not use it frequently and find much better alternatives.
The issuance model of Ether is different. This is mainly because it does not accentuate the deflation compared to the other well-known cryptographic assets. At first, the Ether’s issuance only produces 18 million of Ether every year. 25 percent of the supply will be sold on the market. Even though the 18 million ethers are fixed to be produced yearly, there are still some decreases in the inflation rate. As a result, the Ether turns to be a disinflationary digital currency. The disinflation of currency is present if the currency decreases.
Ether usually have a decrease in their inflation rate since some network performers might disremember their keys. Other users passed away and forgot to pass their keys. Not only that, but there are also some individuals who will send the Ether to an address that does not have their keys. As the Ethereum network is growing, you can expect that the yearly ether rate will be similar to its issuance rate every year.
How to Get Ether
There are lots of techniques that you can do to get your own Ether. These include the following;
- You can get an ether for being a miner. You can be a miner if you will purchase some cloud mining contracts, or you will join to the different mining pools.
- The Ether can be available when there is an entity or person who wants to transfer some of their ethers to you.
- If you own a Bitcoin crypto, you can exchange it with Ether. Just make sure that the bitcoin provides you with BTC-Eth pair.
- You can buy it with the use of your fiat currency.
Why Should You Own an Ether?
Ether has lots of uses. One of the main works of Ether is to give the Ethereum network the gas or fuel to work up. Not only that, many developers and creators are also using it in building decentralized applications or dApps and Smart contracts. These two are being used by other ether users in the Ethereum network.
In addition to that, the Ether is being used by many as a form of investment. Aside from that, it comes up with a value that can increase or decrease over time. It can be used as a person’s tradable item.
Ether is one of the most important elements that is needed to make sure that the Ethereum platform grows and evolves. It is one of the most popular cryptocurrencies that are present in the world of digital currency. So, if you are planning to join the industry of cryptocurrencies, then we highly recommend you to start with the Ether.
But, before you own an ether, you need to have an Ethereum wallet. You can download the Ethereum wallet and install it on your computer. Aside from that, you can also set up your downloaded Ethereum wallet on your mobile devices, such as laptops and mobile phones. On each wallet, there is a private key of an individual. This will enable the owner of the Ethereum wallet to sign the transactions. It can also be used in sending the Ether to your preferred parties.