When individuals ponder the term cryptocurrency, they might usually think of Bitcoin or Ethereum. This would make sense after all, as these are the two biggest cryptocurrencies in the world today, both in terms of price and market capitalization.

As of the time of this writing, the prices for BTC and ETH are approximately $58,359 and $2,106, respectively.

Today, we will focus on Ethereum and grasp some basic concepts about it.

If you are a beginner, the concept of ethereum and the terms associated with it are a bit confusing for you. First of all, keep in mind that Ethereum is not as simple as the other cryptocurrencies, instead, it is something more than a cryptocurrency. Etherum builds up an independent environment where everyone can take advantage of the blockchain industry and make use of the decentralized applications by building their unique projects.

In simple words, there is no limit to how much money you can make with Etherum and what are the possibilities.

Understanding The Basic Concept Of Ethereum

There is ethereum and there is DAPPS. Understanding ethereum is not possible without the right understanding of the DAPPS. To understand this, you can consider Ethereum as the internet and consider the DAPPS as websites. Without DAPPS, no ethereum exists and this is what makes ethereum a decentralized industry with a complete record of all the transactions.

Ethereum’s gas fees on transactions and a couple of other features are being revised. This will give it a big competitive advantage in the market and raise its perceived value in the eyes of investors. More investors may be turning to Ethereum soon as many are predicting another all-time high in the coming weeks.

Although nothing is certain in the crypto world, it is obvious that Ethereum will rise again very soon.

What is Etherum Token?

The concept of Ethereum token is not new in the cryptocurrency world. Ethereum is the blockchain system that involves the ethereum token as well that itself acts as the separate currency and can be sold and bought.

So just like the Ethereum cryptocurrency, you can trade the ethereum tokens. This unique advancement in the ethereum cryptocurrency has become the motivation for most of the investors who were looking for convenient trading options.

Here it is better to understand the concept of smart contracts first.

Smarts contracts how things are going in the Ethereum industry. They contain special instructions and all the information regarding the buying, selling, and trading of the ethereum cryptocurrency. This is the set of instructions that keeps on repeating itself until the final step of the contract is reached and it closes.

What is ERC-20?

To make the ETC20 compliant., the developers use the specific set of functions in their tokens which is known as the ERC 20 standard for tokens.

Putting simply, it is the most significant token used in the Etherum environment and is also used by the empty of other cryptocurrencies such as Basic Attention Token, Augur, etc.

ERC-20 decides what rules should be followed while trading with the ethereum-based tokens and is mainly used to carry out small contracts.

Fortunately, the vast majority of token developers have fallen in line with ERC-20 rules, meaning that most of the tokens released through Ethereum initial coin offerings are ERC-20 compliant.

The best part about the Etherum tokens is that it also ensures the safety of other tokens that are used within the ethereum environment and guides the users on the data access regarding the use of particular tokens.

What is the Gas Fee and why does it exist?

It is the minimum amount of fees that you have to pay to complete the transaction.

So just we need different amounts of electricity to use different appliances, every transaction requires a different amount of gas to complete.

The fee confirms that the transaction has been initiated and is irreversible. All the transactions in the ethereum blockchain are irreversible and the amount of the fees goes to the miners who earn the small quantity of money for each block they mine.

So when it comes to who is earning it, we can say that the fee goes to the miners.

Keep in mind there are no fixed gas fees and your wallet picks only the required amount that is suitable to initiate the transaction.

What Is the Gas?

Just as we use electricity and measure it in kilowatts, the gas is the unit to measure the computational work of running transactions. In other words, gas measures the smart contracts and is the specific unit for it.

What Is The Gas Limit?

Gas is the measurement entity and its unit is “Gwei”. So the gas price is measured in Gwei and is defined as the amount of Ether someone can pay for every unit of gas. It resembles the concept of filling petrol in your vehicle and how much you can pay for it. ‘

If you have read “Wei” somewhere and are confused about what’s the difference between Wei and Gwei, keep in mind that Wei is the smallest unit for measurement and the Gwei contains billion wei.

Learning the basic terms is important before you practically start trading. Here are some standard definitions.

Std (Standard) Cost for Transfer: Average fees that users pay to transfer ETH – in USD value – for a standard priority transaction (usually a waiting time of fewer than 5 minutes)

Gas Price Std (Gwei): Average fees that users pay to transfer ETH – in Gwei value – for a standard priority transaction (usually a waiting time of fewer than 5 minutes)

SafeLow Cost for Transfer: Average fees that users pay to transfer ETH – in USD value – for a low priority transaction (usually a waiting time of fewer than 30 minutes)

Gas Price SafeLow (Gwei): Average fees that users pay to transfer ETH – in USD value – for a low priority transaction (usually a waiting time of fewer than 30 minutes)

Median Wait (s): Average waiting time for a single transaction in seconds

Median Wait (blocks): Average waiting time for a single transaction in blocks

Final verdict

If you have ever used the ethereum wallet, you have noticed that there is a small fee associated with each transaction which is never fixed. So the gas fee keeps on fluctuating depending upon the size of the transaction.

So before you start working with ethereum or trade ethereum tokens, you should have a clear understanding of the terms associated with Etherum and Blockchain.