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What Was the DAO?
The DAO was somewhat of an experiment in corporate governance and structure built on the open-source Ethereum platform, and the ripples of its fall are still felt in the Ethereum world. DAO stands for Decentralized Autonomous Organization, and it was a crowdfunded business or venture capital fund that raised $150 million in a month-- in fact, it was the single-largest crowdfunding campaign ever. It was so big that about 14% of the total Ether in existence at that point was invested in the project, and it was listed on all the major cryptocurrency exchanges. Continue reading...
What is Ethereum?
Ethereum is an open-source, public, blockchain-based distributed computing platform. Ethereum provides a cryptocurrency known as ether. Ethereum is a decentralized platform that runs what are known as “smart contracts.” Smart contracts are applications that run on custom built blockchain, which functions on its own accord through rules programmed into the protocol, and which also makes decisions and keeps records based on consensus throughout a peer-to-peer network. A blockchain oversees its own activities without requiring any trust in a central authority or the other parties involved. Continue reading...
Why do ICOs Matter to Ethereum and Bitcoin?
ICOs can help the market and developers test the waters for new concepts using blockchain technology. When a new idea succeeds or fails after using an ICO, it could be said that the company had made use of every advantage at its disposal and that it had the best chance at success in that environment as it could have had anywhere else. It could have done so more cheaply, and with less interference, than in the “real world,” generally speaking. Continue reading...
What are Multichains and Sidechains?
Sidechains are blockchains which handle assets off of the main blockchain and are able to return them to the main blockchain at a future date. As you understand by now, blockchains are comprised of interconnected computers serving as nodes in a decentralized consensus network. Everything that happens to assets on that blockchain is validated and recorded on that blockchain. If assets are taken to another chain, however, where different protocols may apply to suit the needs of the parties using the assets, this may be called a sidechain. Continue reading...
Who Created Ethereum?
Who would have thought that a 19-year-old from Toronto could write a whitepaper nearly as influential as Satoshi Nakamoto’s (Bitcoin founder)? A few years after Bitcoin’s launch, a young programmer and student of blockchain technology named Vitalik Buterin wrote a whitepaper imagining the Ethereum platform. While Bitcoin’s blockchain was primarily designed to handle transaction information, Ethereum is designed to offer a blockchain protocol for anything that can be programmed, which includes wh... Continue reading...
What is Ether?
Ether is the currency that powers the Ethereum network, which is a platform of distributed blockchain computing on which transactions, smart contracts, and distributed applications operate. Ethereum is a blockchain code environment through which distributed applications, smart contracts, and financial transactions using the Ethereum protocol are tested, validated, and added to distributed ledgers by the mining computers acting as nodes in the network. Ether is the currency, or token, in the Ethereum world which is used to pay the miners and transaction fees which are specific to its blockchain. Continue reading...
How Do You Use Ethereum?
When most people ask this question they are actually asking how to use Ether, the main currency of the Ethereum platform. But the Ethereum platform can be used in many ways as well. Ethereum is a platform that can be used by developers to create decentralized applications (dapps), tokens/cryptocurrencies, and basically anything else that can be programmed. It was the front-runner of the race to develop what is sometimes called Crypto 2.0: blockchain technologies that go well beyond singular usage as digital currency and instead reach and revolutionize every aspect of digital technology in the world today. People can and do use Ether, the primary currency of the Ethereum system, to make transactions like a currency, or as an investment. Continue reading...
How Does Ethereum Mining Work?
Ethereum mining is the process of solving blocks of encrypted blockchain data using a proof-of-work algorithm and occasionally being rewarded with Ether. Blockchain data is validated and added to the distributed ledger by computers on the network performing the task of “mining,” which is continually attempting to solve puzzles, basically, which each unlock a block of encrypted data containing information about transactions, and, on the Ethereum platform, information about distributed application functions and smart contracts. Once a block is unlocked, the data within is shared with the network and added to the distributed ledger. Continue reading...
How Does Ethereum Work?
Ethereum uses a blockchain that looks very similar to Bitcoin’s until you get into the details. Ethereum is a platform on which transactions can be made using Ether or other tokens which have been made using the protocol, and smart contracts and decentralized applications (Ðapps) can be executed using the distributed computing power of what’s called the Ethereum Virtual Machine. When viewed from different angles, Ethereum is an open-source coding environment, a market upon which to distribute new blockchain-based applications, and a distributed computing machine that processes functions of the blockchain applications across a broad network. Distributed computing itself is not that new, but distributed computing on a blockchain is. Continue reading...
What is the Ethereum Virtual Machine?
Ethereum has a Turing-complete platform built into it that allows the blockchain to function like a large distributed computer. The Ethereum Virtual Machine is a part of every Ethereum client software on the blockchain, and it allows the interconnected computers to function as one processor. Distributed computation such as this is not really a new thing, but the fact that it allows all developers in Ethereum to decentralized their projects makes this one of the most revolutionary aspects of the Ethereum platform. Continue reading...
What is Tokenization?
Tokenization is a concept that can take several forms, but essentially it means to create a tradeable item which holds value anchored in an asset which is not itself readily tradeable. If something of value is not easily traded, it is natural that a token is created which represents part or all of such value, which can then be held until redemption or circulated as currency. Historically, some things, such as hours of labor, could not easily be accounted for without a physical token. Continue reading...
What is the Lightning Network?
The Lightning Network is a system that allows for extremely fast Bitcoin transactions off-chain. Lightning Network is a smart contract protocol that uses existing blockchains to mediate transactions off-chain to increase the speed at which they can be finalized. Such a technology is much sought-after in the Bitcoin community, where transactions can take hours to clear if the workflow for miners gets backed up. With the fast pace of business today, the emergence of many other options for faster settlement, such as Ethereum and Ripple, developers know that something like Lightning Network may be needed to keep Bitcoin relevant and make it more scalable. Continue reading...
What is a Decentralized Application?
The Ethereum platform allows developers to use it as a coding environment and distribution network for applications built on the blockchain. The ability to create distributed applications on a blockchain is a novel idea that has gained a lot of momentum since Ethereum’s release. Developers can write and distribute their applications over the blockchain network, at little to no cost, while removing the necessity of running a website or a large server database because the blockchain satisfies these needs. The code for the application becomes part of the blockchain ledger, and users who wish to use some functionality of the decentralized application, or Ðapp as they are called, will submit requests to the Ethereum blockchain, pay the transaction fees for the distributed network to process the requests, and the network will call on the code of the Ðapp stored in the blockchain and process it using the computing power of the distributed network sometimes called the Ethereum Virtual Machine. Continue reading...
How Do Ethereum Smart Contracts Work?
Ethereum smart contracts are an essential part of the Ethereum blockchain that can be coded into financial transactions or decentralized applications. Smart contracts were first described in 1998 by Nick Szabo, but they did not really make their debut until being popularized by the Ethereum platform in 2015. Bitcoin even has protocols in its code to facilitate smart contracts, but Ethereum, because it is a platform for the development of decentralized applications, instead of just a medium for currency like Bitcoin, has gotten all the glory. Continue reading...
What Are the Basics of Mutual Funds?
Mutual funds come in many varieties, but here are some basics to keep in mind to help you find your way. While most people have definitely heard the term mutual fund, many people do not understand how they work and how to use them. With over 10,000 mutual funds available in the marketplace today, the average person may have a hard time selecting appropriate mutual funds for his or her portfolio, determining a good asset mix, and understanding all of the charges associated with buying, owning, and selling mutual funds. Continue reading...
Analyzing Bitcoin's Position: Insights from Top 5 Cryptocurrency Funds
Discover how Bitcoin is transitioning towards mass adoption as we delve into its current position in the market. Learn from the strategies of the top five cryptocurrency funds and understand how they're driving this change. This article provides a comprehensive analysis of Bitcoin's potential as a new asset class. Continue reading...
What is asset allocation?
Asset allocation is theoretically the best way to control the return you experience, through diversification and rebalancing. Asset allocation theories provide you with mechanisms to diversify your money among various asset classes, such as stocks, bonds, real estate, commodities, precious metals, etc. The benefit of asset allocation is twofold: first, nobody knows which asset class will perform better at any given time, and second, various asset classes are not entirely correlated or have a negative correlation, which provides a hedge. If one asset class appreciates significantly, the other might not, but, if the allocation is done correctly, this may be exactly what the investor was looking for. Continue reading...
What are the Expenses Associated with Buying and Owning Mutual Funds?
Several forms of fees and expenses may be charged to those who own, buy, or even sell mutual funds. With mutual funds, there two types of charges that might be paid by the investor: expenses and fees. Different types of share classes may have different types structures to their fees and expenses. Expenses are the operating costs of the fund company, essentially, and these show up in all mutual funds, usually labeled as expense ratios. The returns reported by the fund will be after expenses. Continue reading...
What is an asset mix?
An asset mix is the blend of major asset classes in a portfolio, which should be constructed based on the risk tolerance, time horizon, and goals of the investor. A common example of an asset mix is the 70/30 stock-bond mix, where 70% of the assets are invested in stocks and 30% in bonds. “Mix” is one way of describing the asset allocation of a portfolio, but it also describes the practice of diversifying among asset classes. The core asset classes that most people consider are stocks, bonds, cash equivalents, real estate, and commodities. Continue reading...
What is the right mix of assets for me?
Arriving at the appropriate asset allocation is not very easy to do by guesswork, so we’re here to help. There is no such thing as a mix of assets that is right for everyone. It depends on your age, employment situation, the size of your investment portfolio, your objectives, time horizon, risk tolerance, income requirement from your investment portfolio, tax bracket, and many other factors. Programs and algorithms can help you significantly when you plug some of these variables in, but it is still wise to apply some scrutiny and a human touch. Continue reading...