With the popularity of cryptocurrencies on the rise, let’s delve into the world of Ethereum!
Many of us would have at least heard of bitcoin but many will not even have known a thing such as Ethereum exist. While they belong to the same family, both serve different purposes. Ethereum uses blockchain technology that allows building and deploying of decentralized applications. Miners put in effort to gather Ether which is the currency used for trading and also paying of fees and services on the Ethereum network. Enough with the technical stuff, let’s go into the juicy bits!
Founded by Vitalik Buterin
Ethereum is available for trading on so many platforms
For all those interested in getting your hands dirty with Ethereum its time to open your eyes now! As of July 2016, here are some of those top platforms which offer several ways to trade Ethereum.
If do not want to risk your hard earn money but still want to get in on the action here is a platform that is suitable for you. With the Trading Game, you can freely trade Ethereum without using a single cent. It’s an absolutely free to use application with much to explore!
The highest trading volume originates from Poloniex at 51.54%. This platform holds the biggest share of the ether market. It offers currency pairs such as ETH/BTC, ETC/BTC, ETC/ETH, ETH/USDT and many more. This platform also provides trading of Ethereum classic.
The name originated from World of Warcraft (WoW)
Vitalik handpicked the name Ethereum while he was browsing a list of elements from science fiction. It seemed to be calling out to him and Vitalik took a liking to it. He liked that the word Ether was in it and its meaning which is a medium that allows light to permeate all space and transmit transverse waves. Although Vitalik did play WoW at that time, he did not get the idea of naming his platform based on the Ethereal race that resided in Netherstorm. Any links from the game to the cryptocurrency is purely incidental.
The rapid rise of price
The price of Ether was initially set at 200 ETH per BTC which meant that 1 ETH was probably worth a few cents each. As of June 2017, Ethereum is trading around $407.10 which is more than a 5000% rise in value since Jan 2017. Ether has grown to be the 2nd largest cryptocurrency just behind bitcoin which is valued at $48.91 billion. Its current market value is worth around $36 billion and has a lot of potential to grow further. As Ethereum and bitcoin aren’t competitors in this field, it will be fascinating to see Ethereum at full bloom and when it finally overtakes bitcoin to be the first. Analysts are already expecting the price of Ethereum to cross $1200 by the end of 2017. They have already calculated the results for Ethereum at end year using a complex system called “Gann square” which uses a combination of mathematics, calculus and astronomical analyst methods. Whether or not this calculation is accurate, it does not seem impossible for Ethereum to make the analyst true.
Online search interest is soaring!
Ever wanted to find out more about something before buying it? Just use a search engine to get more information. Between 12-18 March 2017, Ether’s search has hit its peak. There has been a significant relation between search interest and prices of Ether in the past years. And now, from being something that people hadn’t heard of to something of significant value and purpose, I’m glad to say Ethereum is getting popular. And from which countries do people have more interest in Ethereum? The land of the world’s best chocolate, Switzerland! There may be a possibility that Ethereum has another purpose: to help make excellent chocolate!
Banks and Ethereum work together
Due to the nature of the banking industry and the high security banks need to have in order to protect the interest of its customers, Ethereum is more tailored to suit what the bank needs. The value of Ethereum will gradually rise as banks will move towards blockchain-based applications that use smart contracts to automate financial processes. When the demand for smart contracts increases, the value of Ethereum will surge as well. 11 major banks will includes UBS, Barclays, HSBC and many more has grouped together with startup R3(which is an innovation firm which aims to bring the next generation of global and service technology to a whole new level) to test a new system which uses blockchain for trading. What’s so crucial about this test is that it has used a blockchain constructed by Ethereum to enable a new Microsoft platform to run. If those major banks find the test ever so successful and integrate this Ethereum blockchain into their systems, other banks will likely to follow suit creating a new revolution for Ethereum.
The initial version of Ethereum was called Frotier release which was a beta release which gave developers a platform to experiment and learn and finally start creating decentralized applications and tools based on Ethereum. Frontier was launched on 30 July 2015. The next version of the Ethereum platform is called Homestead. It was launched on 14 March 2016 (Pi Day) and it is the first production release of Ethereum. This upgrade includes many protocol changes and a networking change which allows further network upgrades to be carried out. There are also another 2 steps which are currently on the way and the released date hasn’t been confirmed. Step 3 is named Metropolis and Step 4 Serenity. Currently the Homestead release has brought about 8 benefits. One of those is having the cost of creating contracts reduced to 21000 from 32000. Ethereum is still not in its final form yet and it will be very intriguing to see what will happen at step 4! Stay tuned for that!
History of Ethereum
Ethereum needed a lot of resources to kick start it up and get this crypto train going. It had plans to conduct a pre-sale of ether tokens which will allow it to gather enough funds to create several legal entities such as the Ethereum Foundation (Stiftung Ethereum) in Switzerland. In July 2014, a 42-day public ether pre-sale was conducted where Ethereum distributed its initial allocation of ether. This event scored them 31,591 bitcoins valued at over $18 million at that time which was exchanged with 60 million ether. The amount from the exchange was used to settle existing legal debts and also wages for the developers. All’s well that ends well!
Not an overnight success
Ether was already the second in line for the largest market share for the cryptocurrency family. In the first quarter of 2017, ether had increased its market share by $7 billion and its price snowballed more than 5 times. Looking back in 2015, the price of ether had increased over 2800 percent since then. The volume of which ether was trading at had been fluctuating since its release. In March 2017, the 24-hour turnover was close to $600 million while at other points of time it fell to as low as $100,000. Due to its large potential and capability it could bring, the price of ether now definitely shows its worth. Adding on, based on the design of Ethereum platform, developers use the blockchain network to print their own money. The sale of tokens for Ethereum-based projects have risen since 2016 and is expected to go further.
Ether wasn’t made to be used as a global digital currency like bitcoin. Its primary function was to be use as payment for specific actions on the Ethereum network. Due to ether being supported by similar markets of the bitcoin network, ether can be easily purchase on platforms such as Bitfinex and Kraken. Ether’s market did not progress as smoothly as bitcoin. Bitcoin had grown gradually over time as more users started mining the cryptocurrency however Ethereum needed a pre-sale and much donations to fund its development. The pre-sale had gave out 60million ether with another 12 million going into the development fund. So, the first supply of ether totaled 72million with a protocol of having the creation of 5 ETH for every block mined. Following this only a maximum amount of 18million ETH was allowed to come into play each year after this event. Although Ethereum is developing superbly well now, it has faced criticism on security issues. Most of the negativity comes from being in the early stages although it has faced fewer attacks than bitcoin so far. However, as stated above, Ethereum still has steps to go and developers are working on improving the security of Ethereum. Time will only tell!
The future is indeed bright for Ethereum with many having high hopes for it. Adding on the plans already lined up for Ethereum, the question most likely asked is how much can Ethereum grow? Ethereum could possibly become ‘the new internet’ one day and replace and enhance many of the technology we have right now. With the astronomical increase in price in this year, it’s well on its way to overtake bitcoin soon. How fast we will not know but the potential it shows are limitless. Even shows like Silicon Valley has brought Ethereum into the picture!