What is the use of Ether (What technology does Ethernet use?)

08/13/2023 21:25 • Crypto & Markets • 79 views

What is the use of Ether Editor’s note: This article comes from Babbitt News (ID: bitcoin8btc), author: AlexanderBehrens, translator: Wendy, published by the Planet Daily.

Recently, there has been news that Ethereum developers are using Ethereum’s scalability solutions to improve network speed and reduce transaction costs and volatility. However, there is currently no more information available on this. Nevertheless, many developers are still using different tools, protocols, or other methods to promote blockchain development. Therefore, we hope to see more people starting to pay attention to this field.

However, compared to Bitcoin, Ether is a better choice. It has the following advantages: decentralized exchanges on Ethereum; governance system on the Ethereum network; and other use cases in the Ethereum ecosystem; as well as faster execution of proof-of-work algorithms. Additionally, since Ethereum is open-source and created through smart contracts, it is also considered a secure way.

As mentioned earlier, “DeFi” is a major application area of Ethereum – a method of allocating funds to different projects. But now, there are some new applications entering the scope of this field. For example, DeBank provides a token-based platform that allows users to send ETH to their wallets instead of converting it to BTC or using ETH as collateral for loans. However, in this case, there are still some issues to be resolved, such as the high transaction fees on the Ethereum blockchain and the difficulty of tracking. To help improve the above situation, we must understand some key concepts: “DeFi”. These cryptocurrencies consist of various assets: ERC20/TRC-20 Tokens, stablecoins, lending protocols, etc. All of these can be operated through smart contracts. When we want to make money from a project, we don’t need to rely on third parties. You can invest your funds in anything from other projects, or even start a project on Ethereum and make a profit for additional returns.

If you want to profit from a protocol, you have to own your share, and there is no need to sell your shares because you cannot sell them. And if you want to earn staking rewards, it’s best to keep them! That being said, you can still earn income even without sufficient value. It’s all simple. But for those who want to make a profit, it’s a challenge. If someone doesn’t like this, then don’t do it, right? I recommend people to take a look at the Compound’s COMP token model: it allows COMP holders to hedge their ETH holdings while still supporting the protocol. How does COMP work? The issuance of COMP was introduced by Uniswapv2, which made Uniswap the first protocol to adopt such liquidity.

What technology does Ethernet use? According to official sources, the development team of Ethernet is studying how to make the blockchain network more secure and trustworthy. Currently, there are multiple projects in Ethereum attempting to use this technology, such as cross-chain communication, side chains, etc. These three technologies are State Channels, Zero-Knowledge Proofs (ZKP), Plasma, ZKRollup, and so on. Through these methods, security issues in the blockchain network can be resolved, and costs can be reduced.

One of the most popular technologies among them is the Lightning Network protocol. Due to its consolidation of all transactions on a single network, users need to spend a small amount of time to complete all operations.

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What is the use of Ether (What technology does Ethernet use?)

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