If you are a fan of cryptocurrency, I’m sure you have come across Ethereum. This is one of the most famous digital coins. It is mostly associated to bitcoins blockchain technology. Recently, there has been an increase in the online activities with developers creating new applications and software. With Ethereum having a decentralized feature, the developers have been able to conduct their businesses with ease.
The idea was first conceived by a nineteen-year-old who was originally working on bitcoins; Vitalik Buterin. This article will focus on the history of Ethereum as well as other relevant ideas to better understand the concept of this de-centralized platform.
History of Ethereum (ETH)
As discussed earlier, Ethereum was founded by Vitalik Buterin. The Ethereum was first created to support developers who can now create blockchain applications. His inspiration came from the experience he had on using the blockchain system in bitcoins.
Buterin was first introduced to the cryptocurrency world in 2011. During this year, he also helped in starting up the Bitcoin Magazine which he used to explain the future of cryptocurrencies among other relevant information on the same.
Later on, Buterin worked on Mastercoin and a few other altcoins that were solely based on the bitcoins code. With this experience, he was able to see that the bitcoin was limiting. In 2013, he documented the white paper of Ethereum which was an open source protocol dedicated to creating applications that were decentralized. The formation of this cryptocurrency was done alongside other co-founder including Charles Hoskinson, Antony Di Lorio, Dr. Gavin Wood (founder of the Ethereum yellow paper which covered some of the details about Ethereum), Mihai Alisie and Joseph Lubin.
The foundation in 2014 held a crowd sale where they sold over sixty million tokens. This was the very first release of the Ethereum network. After this sale, Ethereum was released and it provided a platform on to which developers could create apps on the network. Since then, the Ethereum community and foundation have grown constantly and recently announced partnerships with big leagues such as Microsoft, BP and Intel. Additionally, a number of new blockchains using the Ethereum platform have gained capital and attention.
In 2017, the Ethereum had gained a profit of over 1000% in just a few months hence the company broke into the mainstream. This also led to the increase in price of alternative blockchain token which was known as ‘altcoin’. Additionally, the media attraction caused by the profits levels increased the numbers of investors in the Ethereum.
All in all, this is a new cryptocurrency that is slowly gaining fame and fortune and would probably overcome the limitations of blockchain technology in near future.
Understanding Ethereum (ETH)
To better understand the operations of Ethereum; we will start by explaining about bitcoins. This is because the inspiration of this cryptocurrency started from bitcoins. When you want to transact for example one bitcoin to buy a house, you will have to know the other person’s wallet (bank account).
The transaction is validated by a team of different people (miners) who cross-check your balance and the balance of the receiver using their laptops until they reach to a ‘consensus’. The data of this transaction is stored in different miner’s computer which ultimately contributes to a large computer that is very secure.
If, let’s say, a smart hacker wanted to hack the servers of the cryptocurrency, it would be very expensive just to make this a reality. Imagine the overall number of miners not forgetting they are worldwide! Smart right!
This makes breaching the security system of bitcoins an impossibility hence making it more secure than any bank with a centralized data center. Now let’s talk about Ethereum. The Ethereum functions with more or less the same concept. For instance, let’s say you give your child allowances on a specific date every month and you have a program that will deduct money from your bank account to your son’s bank account without you having to do it every month. That way the program runs every month and you are sure that your son will get the money no matter what.
Ethereum gives its users a platform where they can develop such programs and transact money or even do other application development. These programs may include sport results, quantities and anything a developer can think of. The possibilities are simply endless. The Ethereum database is also stored in different computers around the world that collectively are secure just like the ones in bitcoin database. Moreover, these computers can communicate with each other.
It is clear that Ethereum is uniquely different from other cryptocurrencies and has more to offer. The best part is, even with its few minor adjustments, it still manages to maintain a safe and secure network.
Benefits of Ethereum Blockchain Platform
- The Ethereum platform allow the users to create their own virtual cryptocurrencies which can be used to satisfy their client’s wishes.
- Ethereum, having a decentralized system, allows its clients to design contracts that do not require any centralized party supervision for example banks. Moreover, the clients can also source funds for use.
- Ethereum allows clients with a sense of imagination to create their own virtual organization where people can vote or even deliberate on any topic. This in turn gives room for the creation of virtual countries with their own sense of constitution.
- With the help of Ethereum GHOST system, the users are assured of a quicker block time which is 12 times more than usual and a faster confirmation of the blocks.
- The Ethash system feature in Ethereum ensures that every miner is awarded for their work. This allows Ethereum to have a sustainable ecosystem and that attracts more and more investors daily.
In conclusion, like every other crypto asset & blockchain as a whole, Ethereum is also young in the market and most investors are doubtful about it even with all the advantages. The one lesson we all need to learn in the world of cryptocurrency is patience. The prices of bitcoins took sometime but now each coin is worth your every penny. We may never know the heights Ethereum will reach, but patience is all that it requires.