Common Misconceptions About Ethereum
- 1. Ethereum is just a cryptocurrency: Many people think Ethereum is only a digital currency like Bitcoin. In reality, it is a platform that enables developers to build decentralized applications (dApps) using its integrated smart contract functionality.
- 2. All Ethereum tokens are Ether: While Ether (ETH) is the primary currency of the Ethereum network, many other tokens exist on the platform, created using standards like ERC-20 and ERC-721. These tokens can represent various assets and functionalities.
- 3. Ethereum is not scalable: A common belief is that Ethereum cannot handle a large number of transactions. While Ethereum faced scalability issues in the past, upgrades like Ethereum 2.0 and Layer 2 solutions are designed to address these challenges.
- 4. It’s too late to invest in Ethereum: Some think they missed the boat on investing in Ethereum, but it continues to develop and evolve. As Ethereum expands its use cases and applications, numerous opportunities for investment and participation remain.
- 5. Smart contracts are contracts in the traditional sense: People often misconstrue smart contracts as traditional contracts. They are self-executing code that runs on the Ethereum blockchain, automatically enforcing terms based on pre-defined conditions without human intervention.