Ethereum 101: Understanding The Cryptocurrency’s Past, Present and Future

  

Ethereum 101: Understanding The Cryptocurrency's Past, Present and Future This article will provide an overview of Ethereum, its history and its current state, as well as how it's likely to shape the future of digital currencies.

What is Ethereum?

Ethereum is a decentralized platform that runs smart contracts: applications that run exactly as programmed without any possibility of fraud or third party interference.

Ethereum is used to build decentralized applications (dapps) on its blockchain. A dapp is an application that is running on the Ethereum blockchain. Decentralized apps don’t have a server, they are hosted on the decentralized Ethereum network.

The most popular dapp built on Ethereum is called CryptoKitties. It’s a game where you can buy, sell, and breed virtual cats. Other popular dapps include Augur, a decentralized predictions market, and uPort, a self-sovereign identity system.

Ethereum has its own cryptocurrency, called Ether. Ether is used to pay for transaction fees and computational services on the Ethereum network.

In addition to Ether, there are two other types of tokens that can be built on top of the Ethereum platform: ERC20 tokens and ERC721 tokens.

ERC20 tokens are cryptocurrencies that follow a set of standards for integrating with decentralized applications on the Ethereum blockchain. The most popular ERC20 token is called Binance Coin (BNB).

ERC721 tokens are non-fungible tokens (NFTs). NFTs are unique digital assets that cannot be replicated or exchanged for other assets like ERC20 tokens can. The most popular ERC721 token is called CryptoKitt.

History of Ethereum

Ethereum is a decentralized platform that runs smart contracts: applications that run exactly as programmed without any possibility of fraud or third party interference.

Ethereum is a public blockchain-based distributed computing platform, featuring smart contract functionality. It provides a decentralized Turing-complete virtual machine, the Ethereum Virtual Machine (EVM), which can execute scripts using an international network of public nodes.

Ethereum also provides a cryptocurrency token called "ether", which can be transferred between accounts and used to compensate participant nodes for computations performed. "Gas", an internal transaction pricing mechanism, is used to mitigate spam and allocate resources on the network.

The native cryptocurrency of the Ethereum network is Ether (ETH). ETH is mined by nodes in the network in order to pay gas fees. In return for their service, miners are rewarded with ETH. The current supply of ETH is over 96 million ETH.

Ethereum was initially described in a white paper by Vitalik Buterin, a programmer and co-founder of Bitcoin Magazine, in late 2013 with a goal of building decentralized applications.[11][12] Buterin had argued that Bitcoin needed a scripting language for application development. Failing to gain agreement, he proposed development of a new platform with a more general scripting language.[13]:224 Work on a prototype began in early 2014[14] with the help of his father, who provided computer hardware and electricity.[15][16] The system went live on 30 July 2015, with

How Does Ethereum Work?

Ethereum is a decentralized platform that runs smart contracts: applications that run exactly as programmed without any possibility of fraud or third party interference.

In the Ethereum protocol and blockchain there is a price for each operation. The general ledger of Ethereum is a decentralized database that keeps track of the balance of all accounts. When someone wants to send funds to another person, they need an Ethereum-compatible wallet and enough ether (the currency) to cover the gas cost of the transaction. The sender signs the transaction with their private key and sends it out into the network.

The transaction is then broadcasted to every node in the network who validates it against the current state of the ledger (i.e. they check that the sender has enough ETH to cover the gas cost). If everything checks out, each node adds the transaction to their own individual copy of the ledger, which is collectively known as the blockchain.

Ethereum Price History

Ethereum is a decentralized platform that runs smart contracts: applications that run exactly as programmed without any possibility of fraud or third party interference.

Ethereum is one of the most popular cryptocurrencies, often referred to as "the next Bitcoin." It has the second largest market capitalization of any cryptocurrency, and has been growing in popularity and value since its launch in 2015.

The price of Ethereum has fluctuated greatly since it first launched, from $0.63 in July 2015 to over $1,000 in January 2018. The price then fell sharply, bottoming out at around $100 in December 2018 before beginning a gradual recovery. As of June 2019, the price of Ethereum is once again hovering around the $200 mark.

What drives the price of Ethereum? Like all cryptocurrencies, the price of Ethereum is driven by demand from buyers and sellers. When more people want to buy Ethereum than sell it, the price goes up. When more people want to sell Ethereum than buy it, the price goes down. This simple economic principle applies to all markets, including cryptocurrency markets.

What are some factors that can influence demand for Ethereum? One factor that can influence demand for Ethereum is news about the platform and its potential uses. Positive news can drive up demand (and prices), while negative news can have the opposite effect. Another factor that can influence demand is changes in regulations surrounding cryptocurrency exchanges and ICOs (initial coin offerings).

Advantages of Ethereum

When it comes to understanding Ethereum, it is important to first understand the advantages of the cryptocurrency. After all, no investment is without risk and Ethereum is no different. However, the potential rewards of investing in Ethereum are significant. Let's take a look at some of the key advantages of Ethereum.

1. Decentralized Platform: One of the most appealing aspects of Ethereum is that it is a decentralized platform. This means that there is no central point of control or authority. Instead, Ethereum is powered by a global network of computers that work together to process transactions. This decentralization makes Ethereum more resilient to attack and censorship than traditional centralized systems.

2. Smart Contracts: Another advantage of Ethereum is its support for smart contracts. Smart contracts are self-executing contracts that can be used to automate various processes and transactions. This can save time and money compared to traditional methods which often require manual processing and verification.

3. ERC20 Token Standard: The ERC20 token standard has become the de facto standard for tokens on the Ethereum blockchain. This standard defines a set of rules that all ERC20 tokens must follow which makes them compatible with each other and with various wallets and exchanges. As a result, there is a large ecosystem of ERC20 tokens which provides investors with a wide range of options to choose from.

ETHEREUM'S FUTURE

Ethereum has been around for almost 5 years now, and in that time it has become the second largest cryptocurrency by market capitalization. Ethereum's success is due in large part to its ability to attract developers and entrepreneurs who are building decentralized applications (dApps) on its blockchain. These dApps have helped to drive adoption of Ethereum and fuel its growth.

Looking to the future, Ethereum is well positioned to continue its momentum as the go-to platform for dApp development. The release of Ethereum 2.0 should further increase interest in the platform, as it introduces a number of significant improvements including increased scalability and improved security. With the continued development of dApps and increasing adoption of Ethereum, we believe that the future of Ethereum is very bright.

Conclusion

Ethereum is an exciting cryptocurrency that has been making waves in the financial world. It's important to understand the past, present and future of Ethereum so you can get a better idea of how it works and what its potential is for investors. We hope this article has given you a comprehensive look into Ethereum, including its history, current status and possible developments down the line. As always with any investment, do your research before getting involved to make sure you are making an informed decision.

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