Ethereum is the most important blockchain behind Bitcoin – and that may be due only to Bitcoin’s network effect, massive capitalization, and name recognition. The combined value of all the applications and tokens running on Ethereum far outweigh the value of Ether (ETH), the base token, itself.

TRX, BNB, OMG, and VEN are just a few high-value tokens starting their lives as ERC20 Ethereum tokens. And let’s not forget about Cryptokitties and other crypto collectibles on its blockchain selling for $100,000 to $1 million.

Before explaining why Ethereum is so important (hint: it’s the first project to focus on the blockchain over the crypto tokenization), let’s explain how the ETH coin is performing on the market.

Breakdown of ETH

Ethereum has a market cap of $27,806,833,708 as of August 21, 2018. This is based on a circulating supply of 101,465,958 ETH, which is currently uncapped (although this issue will inevitably create a hard fork).

The peak price so far of ETH was $1,389.18 on January 14, 2018. Daily trading volume is approximately $1 billion, and it’s accepted on pretty much every exchange, ICO, and crypto platform in existence.

So what is Ethereum? According to the Ethereum project, it is:

“…a decentralized platform for applications that run exactly as programmed without any chance of fraud, censorship or third-party interference.”

No discussion of Ethereum is complete without mentioning Vitalik Buterin, the project’s creator and de facto leader. Buterin came up with the idea of Ethereum a couple years after he learned about Bitcoin. Not even a legal adult when he took an interest in cryptocurrency, Buterin co-founded Bitcoin Magazine.

Buterin authored the Ethereum white paper in 2013, noting that while Bitcoin was a great invention, a blockchain which better supported “colored coins” or “tokens” was necessary. The concept of “smart contracts” is key to understanding the ETH token:

[…] a blockchain with a built-in fully fledged Turing-complete programming language that can be used to create “contracts” that can be used to encode arbitrary state transition functions, allowing users to create any of the systems described above, as well as many others that we have not yet imagined, simply by writing up the logic in a few lines of code.

What Does Ethereum Do?

Like similar blockchains, Ethereum makes virtually any type of application possible in a decentralized, tokenized way. It sports a Turing-complete programming language called Solidity that uses programs (or “smart contracts”) to solve the same computational problems as other platforms and languages.

While it has a primary token called Ether, without which no transactions on the network are possible, it underpins a massive number of other tokens and applications. Some examples of tokens are:

• Aragon, a business-oriented decentralized application
• Status and EOS, both mobile-oriented Ethereum applications, the latter of which enables new types of applications to be built on mobile platforms.
• Power Ledger, one of a few initiatives to allow consumers to buy and sell electricity from each other as well as to businesses.
• In fact, the majority of ICOs are ‘ERC-20’ compatible, meaning they abide by a certain set of Ethereum-compatible rules that allow them to be stored in ETH wallets. These rules help ensure that developers can focus on what makes their tokens unique, and not the basic rules that underpin any smart contract.

Decentralized Applications (DAPPS)

Perhaps the most innovative ability of Ethereum decentralized applications is they don’t require centralized servers and, therefore, control. Decentralization is a deep concept to investigate further, but essentially, it offers four key benefits over centralized applications.

• Resilience
• Censorship-resistance
• Secure
• Verifiable

Dapps are still very nascent and it’ll be several years before they’re proficient. From the perspective of investors, developers, and users, they represent an exciting gateway to a future that may solve some of the most insidious technology problems we all experience today.

For instance, data hacks could conceivably be a thing of the past. Medical records will be both secure and easy to find for medical personnel and patients, no matter which facility they visit. Even something as significant as slowing climate change or tracking disease outbreaks could be more effective with dApps.

In fact, cloud computing, Tor networking, and torrent file sharing are all legacy technologies that perfectly integrate into Ethereum’s blockchain-based application network.

With the first-mover advantage it has, Ethereum can quickly become the Google of Blockchain. And blockchain is well on its way to outpace AI, cloud, IoT, and other technologies as the most valuable because it’ll be powering all of it.

Proof-of-Stake

While Ethereum’s longest chain has been mined by GPUs and other mining hardware for much of its history, in the near future Ethereum will switch to proof-of-stake. Specialized hardware will no longer be required to earn transaction fees and block rewards — instead, people who hold Ether and a current copy of the blockchain will be able to earn rewards, almost like interest on a savings account.

And, like your bank account, Ethereum has been hacked. A 51 percent attack is also still possible, but here’s how the hack went down.

The DAO Hack

Ethereum is an ideal tool for both Decentralized Autonomous Organizations and Decentralized Applications. Smart contracts can be authored by anyone, however, and their security is important. Then came “The DAO,” a venture capital fund which forever changed the Ethereum community.

Shortly after its funding (through the Ethereum platform), a hacker managed to steal around $50 million worth of Ether.  The Ethereum community decided to hard-fork the Ethereum blockchain at block 1428757, effectively undoing the hack. However, not everyone agreed with this decision and continued mining the original Ethereum blockchain, calling their chain Ethereum Classic.

Ethereum Classic (ETC) has all the same functionality of Ethereum and is largely compatible. The important difference is that on the Ethereum Classic chain, the DAO hacker retained his/her/their theft of around 3.6 million Ether – at the time of writing, that’s worth almost $3 billion. No wonder there was an argument…

The Benefits of Ethereum

Ethereum is still relatively new in both technology and finance. It’s the first name in blockchain, and even those not using it were inspired by it. As a currency and investment instrument, Ether has grown more than 30 fold from its initial value of around .005 bitcoins.

For Investors

Ethereum’s base currency Ether makes a good investment because of the high number of new tokens and initial coin offerings which require Ether to make transactions.

The token is continually in high demand to fuel any transactions on the network, and there are dozens of massively popular blockchains using its platform. It’s also easily tradeable on exchanges.

For Developers

Ethereum is highly accessible to users, relatively easy to understand, and has a massive developer community surrounding it. Solidity has a steep learning curve, but it’s a worthwhile investment, as Ethereum skills will prove valuable on the job market.

Despite the hurdles of its proprietary language, Ethereum has wide adoption, and developing in its ecosystem is sure to position you well for the future.

For Businesses

Ethereum is seeing enterprise adoption. In fact, the Ethereum Enterprise Alliance includes partners like JPMorgan Chase, Microsoft, Intel, BP, Accenture, MasterCard, Cisco Systems, and more. Like Six Sigma, blockchain principles introduced by Ethereum will become standard operating procedure in corporations around the globe.

Additionally, things like rewards programs can be modernized with Ethereum tokens, and be assigned real-world, transferrable value, opening new avenues of monetization and engagement for businesses and consumers. The use-cases for the Ethereum blockchain in business are endless.

The Drawbacks to Ethereum

Not the Only Game in Town

Interesting and potentially disruptive alternatives to Ethereum are out, most notably Chinese-based NEO. Even Bitcoin is being upgraded to more closely resemble Ethereum’s multi-layered approach to blockchain.

This is only a drawback in the sense that an alternative could become a more attractive development platform, potentially lowering the desirability of Ether tokens. With the Lightning Network, however, cross-chain compatibility is coming to fruition. It’s more likely Ethereum will coexist with other blockchains like Microsoft, Google, and Apple.

Competition is always a good thing, and every blockchain since Ethereum’s rise copying it is a sign it’s doing something right.

At Present, Somewhat Ahead of its Time

While definitely a great step in the right direction, Ethereum was never perfect.

Ethereum requires massive computing and financial resources as well as electricity to run. This puts a ceiling on the number of people who can participate effectively. This type of drawback generally dissipates as time goes and the effects of Moore’s Law make technology cheaper and resources more efficiently used.

Many blockchains have since been released that address inefficiencies in Ethereum, and its development team is catching up. Its partnerships are what will keep it viable and sustain its growth, despite the glitches and hiccups.

It Can Be Slow… Really, Really Slow

Like first-mover Bitcoin, the Ethereum network has a maximum capacity that often tests the patience of those who use it. Something as seemingly harmless as a few cute kittens brought the network to a standstill.

Multiple efforts to solve the problem of scaling the network are in development – the Ethereum core team is working on a native solution called Plasma, while a token called Zilliqa aims to speed it up drastically through a highly-technical approach called ‘sharding’.

Meanwhile, another project – Raiden – is taking some of the less mission-critical transactions ‘off-chain’ altogether: instead of an app asking for 0.00001 cent every second from a power consumer, for example, it might ask for one cent every 2.77 hours – thus keeping the network mostly unclogged.

Summary

Ethereum isn’t the most cutting edge blockchain on the block anymore, but it’s a host for hundreds of apps that all require its ETH to power transactions. The first legitimate crypto-competitor to Bitcoin, Ethereum has several key ingredients working in its favor.

Ethereum hosts dApps and proprietary tokens, and many of its ERC20 tokens are among the top performing cryptos on the market.

Ethereum’s focus on blockchain over cryptocurrency and smart-contract-based platform spawned a thriving development community that will only continue to grow over time.

ICOs routinely host alpha and beta networks on Ethereum while developing a main net of their own. This means ETH is widely traded and accepted almost everywhere Bitcoin is (except retail stores).

It has weaknesses, but it’s self aware and nimble enough to compete in the modern blockchain market. There’s more competition than there was when Ethereum was first released, but it still has enough gas left in it to take them all on.

What is Ethereum?

The short answer to this question will be difficult to provide as no one yet knows what it is besides another blockchain.

However, for those that know what is, it can be said that the project is an offshoot of the bitcoin project and aims to create a peer-to-peer virtual machine that runs a cluster of programs that function together and interact in a trustless environment.

The project is named by Vitalik Buterin, who co-founded the project with Jelph Rubens and Russ Santia. According to Buterin and others in the team, the reason why Ethereum’s protocol cannot be called a Bitcoin fork is that Ethereum is an entire Blockchain ecosystem versus just a currency.

However, they claim that if the right conditions are met then the soft switch may be implemented allowing users to transact in real-time using their own currency Ether. This is called a “gas” hard work since the Ethereum protocol will remain intact and not need to be modified.

As mentioned earlier, the split is between two forks namely Ethereum classic and Ethereum smartchain. Classic is based on the original design of the Ethereum project, which has received significant modifications and is now known simply as the Verge.

These modifications have been incorporated into the major projects of the projects named Metropolis and Polk Coin which are developed by independent developers and are not under the control of any company or government. Thus, the two forks do not compete with each other and do not cause any harm to the other.

On the other hand, the smart contract platform of Ethlance is entirely different from the original Ethpool. The major difference is the additional functionality provided by the uterine smart contract platform. Buterin built a platform which provides an environment where smart contract can be executed and traded on the same platform as the original Ethpool platform. Hence, the two cannot compete with each other and cannot lead to a split of users.

One of the most important features of the Ethternity project is its own distinct programming language Solidity. The programming language used by the Ethternity project allows developers and users the ability to build a broad range of dapps, ranging from simple dApps like online auctions to more complicated applications like decentralized finance.

Hence, the use of such a programming language ensures that there is no need to modify any existing platform for building new applications. It also ensures that no changes are made to the existing network.

Perhaps one of the biggest advantages of the Ethereum platform is its smart contracts feature. It is called Enterprise Contract or ECD. This feature is actually a program that runs on the underlying ethereal network. The ECD is basically a set of smart contracts which run and execute automatically in response to the various requests made by the users.

It is essentially a set of automated processes which guarantee that the distribution of tokens, among the various users and eCommerce websites, is done in the most secure manner possible. As such, the Ethereum community has been able to significantly reduce spam by relying on this feature.

The Vitalik Buterin’s team has also worked closely with several well-known institutions like The U.K’s Royal Bank of England, The Boston Stock Exchange, The Securities and Exchange Commission and others.

The entire aim behind the development of the Ethereum project and its partnership with these prestigious organizations is to create a platform that can be used in order to facilitate commercial and financial activity. In fact, the team behind the project is working hard to develop a new type of smart contract technology that is referred to as Enterprise Connect.

If you are interested in learning more about the Ethereum platform and whether or not it could be something that you could invest in, then be sure to keep up with updates and articles regarding this very unique and upcoming breakthrough in the field of investing and coin offerings.

You will certainly want to keep up with developments regarding this ground breaking digital currency and the myriad of advantages that it provides. In addition to that, if you have some information pertaining to the Ethereum project, or any other digital currency worth investing in, be sure to visit our website.

Advantages and Disadvantages of Investing in Ethereum

The name behind the project of Ethereum is quite a interesting one. It is meant to be an open source protocol for building applications on top of the ethereum virtual platform. The advantages of this though are many. There is a need for developers in the field to be aware of these advantages while they are in the process of creating applications on top of the protocol and using the ethereum virtual machine itself.

The first advantage of the Ethereum network is that it provides a lot of security. Smart contracts can be written to carry out different transactions in the ethereum network. These are the programs that are able to carry out all the functions that are needed in the management of an organization. With the help of this, the smart contract systems can be secured by the network. This ensures that there is no possibility of hacking or other problems with the network itself. All these advantages of the e Ethereum network make it very important for organizations to see what it can offer them.

The second advantage of the Ethereum network is that it allows people to use any kind of currency in it. Right now, there are two kinds of assets that people can put in the e Ethereum Asset Exchange: ether and fiat currencies. There is a limit though as to how much each of them can be used at the same time. The limit is usually around $4k at present. However, there are many users who are willing to exceed this limit and they end up having more ether than they initially expected.

Another advantage of the Ethereum network is that it provides the users with a way to reduce transaction fees. Right now, the processing fees in the market are too high. This is why most users do not make transactions on the platform. However, with the recent developments in the ethereum project, a transaction fee is now estimated to be around 0.1% of the amount of the transaction. This is a major advantage when you consider that payments have to be made on the verified transactions, otherwise the users will be charged fees.

With the recent boom in eCommerce, most people are already familiar with the e Ethereum platform. However, many others are still not aware of it. For instance, there are some establishments that have yet to catch on with using the platform for eCommerce. Since the launch of its commercial services, the number of ether based business is increasing dramatically. Even though there are some limitations when it comes to the currency conversion, there are several advantages when it comes to the transfer of asset lists.

One of the advantages of the ethereum network is that it can help you get rid of brokerages. In the past, traders had to take the risk of getting their assets tied up in a brokerage. This is because of the higher commissions that brokers charge. With the eth platform, you would be able to get rid of such costs once and for all. This is because you will be able to trade digital currency directly from the ethereum network.

Another advantage of the ethereum network is that it can provide you with instant conversions. The problem with the bitcoin market is that it has a very long delay when it comes to conversion. With the eth platform, the exchange of currencies is faster due to the faster rate of execution which is caused by the increased energy consumption of the machines which conduct the transaction.

There are some disadvantages with the use of the Eth system. For instance, it has limited capacity which means that transactions are slower during peak hours. Moreover, it also has a proof-of-stake mechanism, which limits its capacity growth because the miners will only contribute to those parts of the network that are in circulation. Finally, as more people start to adopt the eth system, the price of the ETC will increase, as more people will start to transact on the e Ethereum platform. However, given the current trend, this should not pose any major problem for the future of eCommerce.