Overview of Ethereum
- Ethereum was founded by 19-year-old Russian-Canadian Vitalik Buterin, whose intent was to take the technology that powered Bitcoin’s digital currency and use it to democratize everything from organizations, business, currencies and even enable users to create “your own country with an unchangeable constitution” – putting the decision-making and power to create anything and economic control into the hands of individuals and taking it away from the world’s central banks, corporations and power brokers.
- Ethereum co-founder Vitalik Buterin stated that while he felt the project was a “great solution as one among several,” Chainlink’s “security model is too centralized for me to be satisfied with it being the solution to all oracle problems.” However, projects that begin fully decentralized start off on the back foot when it comes to governance.
- Ethereum takes that a step further – rather than decentralizing money, Ethereum’s goal is to decentralize the internet by replacing servers with a worldwide system of nodes, creating “one computer for the entire world.” Ethereum is a software platform based off blockchain technology in which users can exchange a cryptocurrency called ether.
- Ethereum aims to change how the internet works, because, for the first time it allows online computer systems to run without using ANY third party. Ethereum lets software applications run on a network of many private computers ( also known as a distributed system).
- Ethereum Classic addresses are composed of the prefix “0x”, a common identifier for hexadecimal, concatenated with the rightmost 20 bytes of the Keccak-256 hash (big endian) of the ECDSA public key (the curve used is the so-called secp256k1, the same as bitcoin).
- Ethereum’s infrastructure was enhanced over the last few years when it was challenged with security issues and since it’s less monopolistic than Bitcoin, it is more open to reform measures that might ultimately make it a superior solution to Bitcoin.
- Ethereum’s market capitalization as of April 2019 is approximately 18 billion USD (about 2 trillion JPY), making it the second largest virtual currency following Bitcoin, which has not been moved from the number one rank.
- Ethereum transaction fees, which can go all over the place, from $20 to $150 or more for a deposit and withdrawal the round trip, means you have to move in size, say $10,000-plus, but the yield is real.
- Ethereum hit a new all-time high at $1,871 on February 13 and after a brief correction, it looks ready for another leg up as long as ETH bulls can hold a key support level.
Vitalik Buterin is the founder of Ethereum, and he set out to build a system that would allow transactions to take place between people anywhere in the world, with no need for trust or due diligence, and to settle those transactions instantly without need for an intermediary.
The currency – Ether – represents this CPU power – so the idea is that Ether will be bought and sold by businesses, governments or individuals to allow them to tap into the vast, distributed resources of the Ethereum network to run their own apps.
To be profitable, most Ethereum miners join mining pools – groups of miners – which give miners a better chance of winning ether.Another pressing factor is that when the Ethereum 2.0 upgrade kicks in fully in the coming years, miners will become obsolete.
Proponents of Ethereum believe its main advantage over Bitcoin is that it allows individuals and companies to do much more than just transfer money between entities leading Bloomberg to write it’s “the hottest platform in the world of cryptocurrencies and blockchains” and companies such as JPMorgan Chase, Intel and Microsoft to invest in it.
Even with Ethereum 2.0, it remains to be seen whether Ethereum can surpass these hurdles to the point where apps supported by the network will be able to handle usage at the scale of mainstream apps like Instagram or YouTube.
Although the CFTC has said it deems bitcoin a commodity, crypto’s future still remains shrouded in uncertainty with the multiple investigations. Despite getting a boost in June when SEC director of corporate finance William Hinman said ether and the ethereum network are not securities transactions, regulators have yet to implement formal regulations for cryptocurrency.
While to many Bitcoin and Ethereum are both simply examples of cryptocurrencies – digital money transfer systems which use blockchain technology and encryption – there are subtle differences in how they work and what they can be used for.
History of Ethereum
- In 2008, an unknown developer (or group of developers) published the Bitcoin whitepaper under the pseudonym Satoshi Nakamoto.
- In 2013, Vitalik published the Ethereum whitepaper.
- In 2014, Buterin and the other co-founders of Ethereum launched a crowdsourcing campaign where they sold participants Ether (Ethereum tokens) to get their vision off the ground and raised more than $18 million.
- In 2014, Ethereum launched a pre-sale for ether which received an overwhelming response; this helped to usher in the age of the initial coin offering (ICO).
- In 2014, Ethereum launched a presale for ether, which received an overwhelming response.
- In 2014, Vitalik was selected for the Thiel Fellowship offered by PayPal founder and investor, Peter Thiel.
- In 2016, $50 million in Ether was stolen by an anonymous hacker which resulted in questions about the platform’s security.
- In 2016, as a result of the exploitation of a flaw in The DAO project’s smart contract software, and subsequent theft of $50 million worth of Ether, the Ethereum network split into two separate blockchains – the altered history was named Ethereum (ETH) and the unaltered history was named Ethereum Classic (ETC).
- In 2016, Dr.
- In 2016, Ethereum was split into two separate blockchains, Ethereum, and Ethereum Classic, after a malicious actor stole more than $50 million worth of funds which had been raised on the DAO, a set of smart contracts originating from Ethereum’s software platform.
- In 2017, CZ noticed the sudden rise in coin offerings and decided to make a coin of his own.
- In 2017, the ADA cryptocurrency was officially launched as the ICO boom neared its peak.
- In 2017, the Ethereum-based game prompted many users to make transactions to participate in breeding their own digital cats (represented as non-fungible tokens).
- In 2017, the value of Bitcoin surged as hype and speculation about its potential shot into overdrive, forcing up the value of a coin to almost $20,000 before it eventually crashed.
- In 2018 and in 2019, he was ranked as one of the “top 30” economists by the Frankfurter Allgemeine Zeitung (FAZ), a major newspaper in Germany.
- In 2019, company announced Binance Jersey, an independent entity from its parent Binance.com exchange, with the aim to expand its European influence.
- In 2020, Ethereum creator Vitalik Buterin published a roadmap with rollups at the center.
- In 2020, its closest competitors include Ethereum, Ripple (XRP) and Tether.
- In 2021 Ethereum plans to change its consensus algorithm from proof-of-work to proof-of-stake.