ETHEREUM

INVESTMENT
GUIDE

MyDigitalMoney.com
November 2022
WHAT TO EXPECT
IN THIS GUIDE

Understand
Understand
how
the function
Ethereum
of Ethereum
works

Value
Proposition
Budgeting

Know why
you should Learn how to
and shouldn’t invest in
invest in Ethereum
Ethereum

MYDIGITALMONEY.COM 2
The creator of Ethereum
Ethereum is known as Bitcoin’s
closest rival. They are supposed
to be complementary. Vitalik
Buterin created ethereum as a
companion of Bitcoin but there’s a
chance Ethereum will prove to be
the more valuable blockchain.
Why does Ethereum exist and
what purpose does it serve?

Like Bitcoin, Ethereum is a public

blockchain network. They both rely on a
blockchain to operate.

Think about the Internet. You can build

lots of different applications on top of it
like email, online shopping sites and
Facebook.

Well, in a way, blockchain technology is

a new type of Internet where you can
build lots of different applications.
Bitcoin and Ethereum are just two
examples. Bitcoin and Ethereum are
both digital currencies.
Bitcoin, however, has one function, to But the primary purpose
be an alternative currency. Ethereum, of ether is to facilitate
on the other hand, offers a platform and monetize the
that enables developers to build and operation of the
deploy other decentralized Ethereum smart contract
applications. You could, for example, and decentralized
build a cross-country payment system, application or dapp
or a streaming platform, and others. platform without any
downtime, fraud, control
Its native currency is called Ether, like or interference from a
the gas. third party.

MYDIGITALMONEY.COM 4
What’s a decentralized
application?
A decentralized application (Dapp), in this context, refers
to an application that is built on top of blockchain
technology. Bitcoin is a decentralized cryptocurrency
application for payments, for example.

Decentralized applications run on a blockchain and benefit

from all of its properties like immutability, security, tamper
resistance and zero downtime. Essentially any service
could be turned into a decentralized application. The
possibilities are endless.

Decentralized applications enable services we already

have today, like payments,
storage, or computing, but without a central operator of
those services.
How does Ethereum work
There are three things you need to know related to Ethereum:

01 Smart Contracts

02 Ether

03 Proof of Work

MYDIGITALMONEY.COM 6
 1 SMART CONTRACTS
A smart contract is a self-executing contract with the terms of the
agreement between buyer and seller being directly written into
lines of code. The code and the agreements contained therein
exist across a distributed, decentralized blockchain network.

Smart contracts run on top of the Ethereum blockchain precisely

as programmed and become like autonomous agents that
execute when previously specified conditions are met.

Creating a smart contract with infinitely more complicated

conditions is possible as well. A smart contract could, for
example, facilitate the automatic transfer of ownership of a
property after a number of critical conditions are met. All of this
without any human involvement.

TRADITIONAL SMART
CONTRACTS CONTRACTS

Parties Contract

Parties Smart Execution

Contract

Execution 3rd Party

Smart contracts are, in essence, computer programs that automate the enforcement of terms. Traditional Contracts, on the
other hand, are sets of agreed-upon terms which are enforceable by law and are described in a natural, human language.
2 ETHER
Ethere is like a fuel that provides an incentive to ensure
developers write quality applications and the network runs
smoothly.

Ether is also a tradeable cryptocurrency. In Ethereum, Ether is

used by developers to pay for transaction fees for services and
storage on the network. Every computation on the platform as a
result of a transaction has a fee, and the more you need to store
the more is paid.

So, think of Ether like the crypto-fuel that powers the

Ethereum network.
3 PROOF-OF-STAKE (POS)
The Ethereum blockchain used to run on a proof-of-work (PoW)
consensus protocol—a protocol in which computer nodes expend
copious amounts of computational power to come to a consensus
on the network.

The high energy consumption has led to slower and more costly
transactions. In an effort to keep the network sustainable and
environmentally friendly, it shifted to a proof-of-stake (PoS)
protocol. The new consensus model is predicted to reduce energy
consumption by 99.95%.

Under a PoS, miners stake a minimum number of Ethers to

‘stake’. The system then chooses who will validate a transaction.
Whoever is chosen earns Ethers.
Institutional Use

A report from International Data Corp stated that corporate and government
spending on blockchain technology has increased by 89%. By 2022, the firm
reports that total blockchain spending will reach $12.4 billion.

THIRTY-TWO FORTUNE 500 Here are some of them:

1. Amazon
COMPANIES ARE BUILDING
2. Overstock
SYSTEMS ON ETHEREUM OR 3. Anheuser-Busch Inbev
ENTERPRISE ETHEREUM 4. BBVA
DERIVED BLOCKCHAINS 5. BNP Paribas
PLATFORMS. 6. Citigroup
7. Fidelity
8. UBS
9. Northern Trust
10. BP PLC
11. Ciox Health
12. Metlife
13. Coinbase
14. Google
15. HPE
16. Microsoft
17. VMware
18. Siemens
19. Comcast
20. Foxconn
21. Intel
22. HTC
23. Samsung

MYDIGITALMONEY.COM 10
Ethereum Price History

Ethereum’s developers, led by Buterin, Then it free fell to $141.

launched the blockchain in 2015, two
years after the open-source Ethereum It wasn’t until 2021 when the NFT
whitepaper outlined the protocol. For all market exploded, that Ethereum
of 2015, Etherum was valued under $1. became the go-to blockchain because
of its smart contract capabilities. It
The first rapid climb happened in 2017, reached its all time high of $4,8000.
when a bull market hit. ETH went from
the mid $40s to $826. This was It has been on the up and up since the
Ethereum’s first major jump. last week of October and is north of
$1500 as of writing.
The following year, it was a series of
peaks and valleys, that ended at $1,396

MYDIGITALMONEY.COM 11
 HOW TO INVEST
IN ETHEREUM
The most common way to invest in
Bitcoin is by buying it directly in a
platform like My Digital Money
(MDM). With My Digital Money, you
do it two ways: Crypto IRA or
standard trading.

CRYPTO INDIVIDUAL
RETIREMENT ACCOUNT
(CRYPTO IRA)

For you to understand a Crypto IRA, you

have to first understand a self directed IRA
or SD IRA.

SDIRA is a type of individual retirement

account that can hold a variety of alternative
investments normally prohibited from
regular IRAs. Although the assets you put in
an SDIRA have to be stored by a custodian or
trustee, it’s directly managed by you, the
account holder.

Under SDIRA, you can put different assets

STANDARD
including cryptocurrencies. This is
commonly called Crypto IRA. CRYPTO TRADING

Just like a regular IRA, a crypto IRA is Just like buying and selling stocks,
available as either a traditional IRA or a Roth you can also buy and sell crypto with
IRA. They can either shield their gains from My Digital Money.
taxes with a Roth SD IRA or defer paying
taxes until they liquidate with a Traditional
Deposit cash and buy and sell any
SD IRA.
kind you want.

MYDIGITALMONEY.COM 12
How to open an account with
My Digital Money
STEP Go to www.mydigitalmoney.com.
01

STEP On the upper righthand corner, click on sign up.

02

Enter your full name, email and phone number.

STEP You will get a code in your phone. This is an added layer of security, to
03 make sure you are really the one using your phone to register.

STEP You will be asked to choose whether you want to open an account or open
04 a play money account.

STEP Choose a play money account if you want to invest using only play money.
05 Choose open an account if you actually want to open an account

STEP You will then be prompted for answers to questions one at a time.
06 Just enter your answers and wait for the confirmation email.

You also don’t have to wait for your current custodian

to release your funds, you can fund your account with
new money.
HOT TIP
The crypto market moves at lightning speed, you don’t
want to miss a chance. If your crypto watchlist starts
To make the process even
dipping and you want to buy, you won’t be able to if
smoother you have an
your custodian is taking their sweet time releasing
existing retirement your fund.
account, a 401K or IRA, it’s
better to have your account And if at any point, you feel you are confused or you
number, custodian address want help or need some more information, call us at
and name ready. 833-MDM-2008.