Compared to Bitcoin that is currently struggling due to internal divisions, Ethereum is soaring in value. It has climbed to over 1000% over the last few months that is why it is attracting a lot of investors in finance and technology. JPMorgan Chase, Microsoft and IBM have described Ethereum as Bitcoin 2.0.
The rise of Ethereum as a virtual currency is due to an internal division in Bitcoin community over how the basic Bitcoin software should be developed. Since Bitcoin transactions have slowed down, people begun to look for alternative cryptocurrencies like Ethereum. Like Bitcoin, Ethereum is built on a block chain wherein every transaction is recorded publicly. This system makes the transfer of money and assets more convenient and quick because there are no middlemen between the buyer and seller.
Ethereum was also built to do much more than Bitcoin because in addition to being a virtual currency, its software can create online markets with programmable transactions called smart contracts. The system is complicated enough and cannot be described in plain English but one application in its development is allowing farmers to offer their products for sale directly to consumers and take payment directly when there is a sales transaction. Ethereum also offers new ways to pay for electricity bills and sports bets.
On the other hand, some Bitcoin followers have listed the drawbacks of Ethereum. Since its software is more complex, it is bound to face more security problems. Ethereum has faced much less testing and fewer attacks than Bitcoin. Due its novel design, Ethereum may face more intense scrutiny from authorities due to potentially fraudulent contracts. The first public version of Ethereum software could face some of the legal and technical problems that tarnished Bitcoin.
However, the sophistication of Ethereum has made it more appealing to corporate America. IBM has recently stated that it is experimenting with Ethereum as a method to control real world objects in what they call as the internet of things.
Microsoft is also working on several projects to make ether cloud mining easier. The tech giant believes that Ethereum can be a general platform where problems in the industry can be solved with a fairly elegant solution.