Ethereum, the Marvelous Machine

The hype train has just arrived at Ethereum station and nobody wants to be left behind. The Ethereum network is a cool cousin of Bitcoin, and its cryptocurrency Ether (or ETH) is in a full bull cycle. In December it had already made a strong jump in its price and reached 600 dollars per unit, but this week it hit 1,435 dollars, surpassing its previous all-time high, reached in 2018, by 15 dollars.

Ethereum, while similar to Bitcoin, has several differences worth highlighting. ETH is divisible up to 18 decimal places, so you can acquire as little as 0.000000000000000001 ETH (with BTC, on the other hand, you can only operate up to 8 decimals). On the other hand, Ethereum is not just a blockchain-based crypto network, but functions as a decentralized computer in "the cloud".

Ethereum has the ability to execute computer programs (combining all the computing power of the nodes in its network) in exchange for a payment. Additionally, Ethereum's code allows the execution of a type of software called smart contracts, which, being written on a blockchain, turn out to be immutable computer programs that always execute in the same way. Something like soda vending machines, which are automatic systems that upon an input signal (inserting money) respond with an output signal (dispensing a can).

In this way, Ethereum quickly became a great tool for building things using smart contracts. This allowed, for example, the simple creation of new cryptocurrencies, digital collectibles, video games, and a whole new universe of decentralized finance based on this type of programs, known as DeFi.

Another of the most significant use cases for Ethereum are stablecoins, whose value is maintained in a one-to-one parity with the US dollar. Furthermore, they have none of the currency exchange restrictions of the American dollar. DAI and USDC are the best known and most used in Argentina, and our country stands out for playing a leading role in the Ethereum community.

While Bitcoin is the most widely used cryptocurrency and its name already represents a brand in itself, Ethereum has become the most attractive space for developers, since it has its own language (Solidity) and is an accessible platform for easily creating new applications.

On the other hand, Bitcoin and Ethereum differ in the number of available units. While Bitcoin has an issuance cap set at 21 million units, Ethereum has no pre-established limit. At the time this article was published, the total exceeded 114 million units. For Bitcoin advocates, this is problematic since there would be no substantial difference between Ether and fiat money, that is, money controlled by governments and issued according to the needs of the moment.

So many rigs I have

You only need to walk around the Galerías Jardín, located on Florida Street (the most famous pedestrian street in the heart of Buenos Aires) to come across a considerable number of people going from shop to shop asking about GPU prices. Many are there for video games, but others for Ethereum mining which, at these prices, has once again become a very profitable investment.

It turns out that, unlike Bitcoin, Ethereum can still be mined with regular off-the-shelf graphics cards, known as GPUs (short for graphics processing unit). "At this price, you recover your dollar investment in five months," says an industry source who prefers to remain anonymous, while going from shop to shop haggling over GPU prices as if they were carpets in some Middle Eastern bazaar.

Buying Ether in Argentina

As we previously explained with Bitcoin, buying Ethereum does not require any special science, just opening an account on a trading platform (Binance, Satoshi Tango, Ripio), completing a brief data verification process, and then depositing pesos to start trading. Selling works the same way: you sell directly to the platform in exchange for pesos.

After buying, if the idea is to hold those ETH or use them to invest in DeFi, the most recommended approach is to remove them from the platforms and send them to your own wallet, such as Metamask, an Ethereum wallet compatible with all coins and tokens that use this technology, featuring a simple interface that can be installed as a web browser extension (Chrome, Firefox, Brave) or downloaded to your phone.

Also, for those who prefer a 100% off-the-books option so their transactions are not recorded on any platform, they can find refuge with the increasingly numerous crypto street dealers. Whether for Bitcoin or Ethereum, the crypto summer is in full swing in Buenos Aires.

This article was originally published in Página/12. It is reproduced here with the author's permission.