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What is Ethereum?
Ethereum is a decentralised open-source blockchain technology platform. The cryptocurrency of this platform is Ether (ETH), which is the second-largest in the world by market capitalisation after Bitcoin. Many other cryptocurrencies also operate on the Ethereum platform and have used it for initial coin offerings. In addition, Ethereum supports thousands of decentralised applications and allows users to create and exchange non-fungible tokens (NFTs).
The Ethereum community goes beyond payments and is building a peer-to-peer financial system. This decentralised financial system is called DeFi. The applications built on the Ethereum platform are called dapps. There are dapps for finance, social media, gaming, and work. Once you have a wallet with ETH, you can start to use these dapps.
In addition, Ethereum enables users to create smart contracts, which are activated when certain conditions are met.
How do I purchase Ethereum in Australia?
You can buy Ethereum through a cryptocurrency exchange or directly from a wallet. Exchanges that sell Ethereum in Australia include Binance, Bittrex, Coinbase, Coinmama, Coinspot, Crypto.com, Gemini, Itez, and Kraken. You can also buy Ethereum from wallets such as Argent, imToken, MyCrypto, MyEtherWallet, Squarelink, and Trust.
You may want to buy ETH with traditional payment methods in Australian dollars. In that case, you can acquire them through a dealer such as Localcryptos. Or you may choose to buy ETH with other cryptocurrencies by swapping your tokens with people who want to sell ETH. See the Ethereum price in AUD on Coingecko at the time you plan to buy.
Your Ethereum wallet
If you want to hold ETH, you need to select a wallet, and Ethereum offers about 40 options. Some of the different features that Ethereum wallets may offer include:
- Buy ETH directly from your wallet with a bank card.
- Connect to Ethereum dapps.
- DeFi access, which allows you to borrow, lend and earn interest directly from your wallet.
- Withdraw your ETH directly to your bank account without going through an exchange.
- Protect your account by setting transaction limits.
- Token swaps, meaning that you can trade between ETH and other tokens directly from your wallet.
Once you decide which of these features are important to you, you can filter the wallet list by features, and select one that suits your needs.
How much does Ethereum charge in transaction fees?
When you initiate a transaction on Ethereum, you receive a transaction hash that's generated by cryptography. This hash is broadcast to the network. A miner must pick up your transaction and include it in a block so that it will be verified. Once this happens, your transaction will receive confirmations.
An Ethereum transaction fee called gas is charged on each transaction in order to cover the cost of computational resources and pay miners for their efforts. Gas fees also keep the network more secure as they deter bad actors from operating freely. Gas fees are paid in Ether and denoted in gwei, which is equal to 0.000000001 ETH.
The amount of gas you’re charged depends on the number of instructions that need to be executed to complete your transaction. When you initiate the transaction, you can specify the maximum amount of gas you’re willing to pay for the transaction and the maximum amount of gas to be given as a tip to the miner.
How to mine Ethereum
Ethereum miners aggregate transactions initiated by dozens or hundreds of users into a block and verify the validity of each transaction. The miner then broadcasts the completed block. Other nodes hear about this block, verify it and append it to the tail of the blockchain. In this process, miners deposit the transaction fee of each transaction into their own accounts.
Ethereum mining can be a source of income but requires investment in the hardware needed for a mining rig, electricity costs, and supporting equipment such as ventilation, wiring and more.
Disclaimer
This article is over two years old, last updated on April 6, 2022. While RateCity makes best efforts to update every important article regularly, the information in this piece may not be as relevant as it once was. Alternatively, please consider checking recent cryptocurrency articles.
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