Everything You Wanted To Know About Ethereum But Were Too Afraid To Ask

I've lost count of how many times people have asked me to explain what Bitcoin is over the years, but I don't think anyone has ever asked me to explain Ethereum.

Maybe they were caught off guard when I ran out of bitcoins and wanted to spare them another help.

But today we ask ourselves, what is Ethereum?

If you thought Bitcoin was hard to explain ...

A brief history of Ethereum and its founder Vitalik Buterin

Ethereum is the second largest currency by market capitalization in 2018. It is the brainchild of Russian-Canadian program producer Vitalik Buterin, who first came up with the idea in 2013.

At this point, Buterin had been dealing with Bitcoin for several years. He first discovered Bitcoin in 2011 from his father, a computer scientist, when he was still 17 at university (which he will soon drop out). The same year he founded the Bitcoin magazine.

To make you feel inadequate, Buterin is only 27 years old and a multibillionaire, so he has already donated over $ 2 billion to charity.

Philosophically, Buterin is quite techno-liberal. In 2018 he co-authored an article with economist Glen Weil, The Liberation of Radical Decentralization, Using Markets and Technology to Decentralize All Forms of Power and Change Our Dependence on Authority and Formal Rules.

A 2019 paper co-authored by Harvard PhD student Zoe Hitzig proposed a new method for better delivery of public goods and services that uses the "square vote," a flexible design to support public goods; a more complex voting system than the current representative system. direct democracy.

Buterin published the Ethereum white paper in 2013. The name was chosen after studying the list of points on Wikipedia. "It looked good," he says, "and there was the word 'aether', which refers to the hypothetical invisible medium through which light travels through space.

He announced the project at the North American Bitcoin Conference in 2014 and development began with an all-star founding team that included Anthony D'Iorio, Charles Hoskinson (founder of Cardano), Mihai Alis and Amir Cherit, and after Joseph Lubin, Gavin. Wood. Summer and Geoffrey Wilke.

This summer they raised funds to launch the project. At the time, Buterin was considered a child prodigy in cryptographic circles.

I was invited to participate in this funding, but I remember that I did not go there because I was disappointed by the weakness of the program. Stupidity.

The project was finally launched in 2015 and after a $ 150 million crowdfunding, the project has to be considered a huge success despite many obstacles including a $ 50 million hack and multiple forks.

Ethereum's market capitalization is around $ 400 billion. Ether, which changes hands on the Ethereum network, has gone from under $ 1 at the end of 2015 to $ 3,500 today.

What exactly is Ethereum?

The founding principle of the project was to use blockchain technology outside of an alternative digital currency system. Bitcoin has its own blockchain, just like Ethereum, which uses the same distributed ledger technology (blockchain) as a completely separate network to verify and record transactions.

Like most cryptocurrencies, Ethereum is an open source platform. Ether is used and accepted as a form of payment, but that's not exactly what Ethereum is about.

Byte Tree's Charlie Morris likens it to a decentralized app store. Developers can use the platform to create and publish smart contracts and distributed applications (dApps), and it is a marketplace for financial services (Diff), NFT (non-core token), games and apps, all of which can be broken down into Ether. .

Hence, it is known as the "programmable blockchain of the world". It is "inclusive, decentralized, secure and can be used for any business".

Therefore, developers can deploy decentralized applications on the Ethereum blockchain. They will be immutable and persistent and users will be able to interact with them.

Decentralized Finance (DeFi) applications enable all types of financial services, such as decentralized currency exchanges or lending and lending systems, without traditional financial intermediaries such as banks or brokers.

Ethereum allows for the creation and exchange of NFTs, tokens associated with digital artwork and other digital assets.

Many use the platform for initial coin offerings, and many cryptocurrencies actually run on the Ethereum blockchain (known as the ERC-20 token). DAO, Digital Autonomous Organizations, are created on the platform.

So overall, Ethereum has had many uses and has been an amazing way to take advantage of the incredible innovation that is happening in the industry.

Will Ethereum lose the race?

One of my closest friends, The Original Bitcoin Mafioso, who prefers to remain anonymous about this, always tells me: "Ethereum should have failed, and it's a mystery to me why it won't."

Many people feel the same way. Block is not as strong as Bitcoin. Ethereum is adequately decentralized, and the numerous forks that have arisen in response to the hack confirm that critics say it is impossible to find a properly decentralized platform. A large number of coins have already been mined and donated to the founders. Ethereum 2.0 is bound after a delay. The transaction costs, known as gas fees, are huge (I can attest to that). Sometimes they spend hundreds of dollars when they have to spend pennies. It's a time bomb, critics say.

Perhaps. Ethereum has many competitors such as Binance Smart Chain, Polkadot, Cardano, Terra, and Solana. Both Cardano and Solana have had excellent results, the latter in recent weeks. Most of them are technologically advanced, the critics are faster and louder. They certainly don't have exorbitant gas bills.

But the one thing they don't have is a network of users. Ethereum has it. it's the first coin people think of after bitcoin, even if they can't pronounce it. This usually gives you the prime mover advantage.

But this is the market. Everyone presents the proposal, presents their proposal and the price is the result. The witness doesn't always win.

Ethereum is second only to Bitcoin. It was a good year after many good years. Bitcoin is like cash for gold, not only does it have more uses, it is also more volatile. It usually moves in one cycle, but more, but when a correction comes, it hits harder.

at the end of 2015 it was $ 0.42. In early 2017, it jumped to $ 1,400. It then lost 95% of its value and dropped to $ 80. With this year's correction, it lost over 60%. But the bottom line is that in 2021 it started under $ 800 and has now more than quadrupled to $ 3,500.

The direction is removed. But for how long?

The robbery of the day. How Taxes Shaped the Past and Changed the Future is now available in paperback on Amazon and all good bookstores as an audiobook, read by Dominic and elsewhere.

You don't want to miss the next NFT projects.