Ethereum is a decentralized open-source blockchain system that features its own cryptocurrency, Ether.
What is Ethereum?
- Ethereum is the second largest cryptocurrency after Bitcoin and Ethereum also has the second largest market share and trading volume.
- Ethereum has recently developed to Ethereum 2.0, changing from Proof of Work to Proof of Stake which is more energy efficient and secure. Proof of Stake can also support 100,000 transactions per second.
- Ethereum is an open-source blockchain-based platform allowing developers to create smart contract and decentralized applications (Dapp) which users can access to various types of transactions without intermediary. As Ethereum is an open-source platform, any tokens created on the Ethereum platform are also an ERC-20 token.
- Ethereum is one of the cryptocurrencies on blockchain invented by a Russian programmer, Vitalik Buterin. He was previously one of the Bitcoin development team who proposed a concept supporting a complex smart contract, but his idea was rejected. Thus, Vitalik started to create his own blockchain platform which is widely known as Ethereum nowadays.
|Total Token Supply||Unlimited supply|
|Current Circulating Supply||See Coinmarketcap|
|Market Capitalisation||See Coinmarketcap|
|Token Creation Date||July 2015|
|Can it be mined?||Yes|
Who is behind Ethereum?
Ethereum has a total of eight co-founders — an unusually large number for a crypto project. They first met on June 7, 2014, in Zug, Switzerland.
Russian-Canadian Vitalik Buterin is perhaps the best known of the bunch. He authored the original white paper that first described Ethereum in 2013 and still works on improving the platform to this day.
What is the purpose of Ethereum?
Ethereum’s own purported goal is to become a global platform for decentralized applications, allowing users from all over the world to write and run software that is resistant to censorship, downtime and fraud.
- Smart Contract and Dapp platform, the world center computer which enables computing decentralized applications (Dapp) by openly using smart contracts.
- ICO platform, a fundraising platform which generates tokens to be sold on ICO.
- An Asset Issuance Platform used to issue the tokens and transfer the values of the asset including actual assets such as USDT and USDC.
- A decentralized Finance (DeFi) platform creating a new generation of finance.
- ERC-20 is a set of protocols used with every Ethereum-based token making them compatible with the Ethereum network.
- Proof of Stake means locking a token for a period of time in which the blockchain will randomly select a user from those who staked their coins to verify the next block on the blockchain. The chance of a user getting picked usually depends on the number of coins staking in the system. The more coins locked in the system, the more likely it will be.
- Gas fee is a transaction fee on Ethereum which is limited to avoid exceeding fees.
- The current gas fee has increased significantly due to the density of the Ethereum blockchain. Previously, the highest gas fee was around 5.5 USD (As of Jul 2018), but gas fee currently goes highest around 25.1 USD (As of Jan 2021) which increases 356.36%
- ETH hash is a mining power of Ethereum DeFi’s computers and blockchain networks, leading to the increase in gas fees and a higher ETH Hash Rate.
- Smart contract is a term of agreement written in computer programming language which permits accuracy, transparency, higher credibility, and efficiency. A code can also be written to create a wide range of decentralized applications.
- It takes 12 seconds to create an ETH block and after the hard fork of ETH, it requires a shorter time for creating a block as more of them are mined and a higher inflation rate of Ether.
- People started to pay more attention to DeFi and the concept was taken for further development. One of the DeFi systems actually takes place on the Ethereum blockchain. Moreover, there are many applications offering stablecoin lending and collateral with various types of coin such as MakerDao and Compound.
- The volatility is just like other digital currencies which is still a concern since no one can estimate the accurate value of Ethereum.
- The more ICO fundraising on the Ethereum system, the lower potential the system could support a vast volume of investment at the same time.
News and Updates:
- Ethereum 2.0 is preparing for the first hard fork which is considered as the major change. One of the developments is supporting light clients, which is a node requiring the least resources and support on mobile devices. This will help the Trust-Minimized Wallets verify the blockchain on their own instead of relying on external service providers.
- Reports reveal that 80% of the institutional investor’s capital in the crypto market is invested in Ethereum. The total investment is approximately $195 million which happened before the opening of CME’s ETH Future Exchange on Feb 8, 2021 while only $41.9 million went to Bitcoin investment, implying that many investors are starting to diversify their investments in the crypto market.
Community & Whitepaper Links:
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