Crypto 101 Ethereum
2nd position on crypto market list
Market Cap of : 130 Billions$ Us
17% of crypto dominance
Consensus : Proof-of-work
[image credits:Themerkle]
Goal of Ethereum
Offer a decentralized blockchain that allows users to develop the smart contract while using several types of programming language.
http://www.ethdocs.org/en/latest
Founders
Founder : Vitalik Buterin
developer : Sofian Abbas
Historic
In December 2013, Vitalik Buterin publishes the White Paper White Paper of his Ethereum project
At the beginning of 2014, he put the first Ethers in presale to finance the development of his project. The sale enabled him to collect 31,590 bitcoins worth more than $ 18 million at the time, for 60 million sold Ethers.
July 30, 2015: The blockchain is launched with the first version of the software named Frontier
March 2016: new version of the software called homestead is launched.
May 2016: An independent organization launched an ICO (Initial Coin Offering) called TheDao. They collected more than 150 million in Ether in order to develop a decentralized autonomous organizational protocol. Then, they got hacked and funds for a value of 50 million has been diverted to multiple account. Following this hacking, the majority of members voted to create a first hard-fork to literally change the blockchain, void the 50 million of ether being hacked and thus refunded the investors cheated. This goes against the basic principle of the Blockchain that its integrity is untouchable and that no one can change the past of a blockchain . A group of opponents who did not want to join the consensus maintained the blockchain in its integrity and continued under the ETC Aka Ethereum Classic.
September 2017: First phase of the Metropolis update called Byzantium is launched. Mainly to improve the security and performance. The second phase expected under the name of '' Constantinople '', however, should bring some more drastic changes. Moving from a Proof-of-Work to Proof-of-Satke consensus.
So what offer Ethereum platform
Ethereum is a versatile eco-system for the development of applications using the smart contracts protocol. These applications can develop their own "Token", these tokens can be used as bargaining chips, as voting power as well as acting as corporate action. Unlike bitcoin, which is an peer-to-peer mode of of payment, in the smart contract conditions can be added.
For example the customer buys a good or service, but condition or expiration time can be issued. The customer pays at the time of purchase but the merchant receives the funds only after delivery. A bit the same principle as some self-employed internet grouping site like [Elance] (https://www.elance.com)
This could be fantastic for us consumer with guaranteed delivery in 30 minutes. On my pizza deliveries, I would have saved me a lot this week.
However, big changes are on the way for the Ethereum platform. Indeed, the goal of the "Metropolis" update is to change the consensus of Proof-of-work to Proof-of-Stake. The objectives are to increase the amount of transactions processed per second and to make the platform more energy efficient. This is among other things the reason for the rise in Ethereum prices as miners will have to own ETHs or borrow them in order to continue forging future blocks.
[image credits:coindesk]
Some projects under the Ethereum environment
0X, Aragon, Augur, Dentacoin, DigixDAO, Distric0x, Golem, Hmq, Monaco, and more.
Complete liste availaible below:
Token market
Pros of Ethereum
- Allow to put conditions on a transaction
- Versatile ecosystem that can accommodate multiple programming languages
- Applications can be configured on private servers
- Easily configurable platform to perform pre-launch offers and Initial Coin Offering
- Decentralized ecosystem
Cons of Ethereum
- BlockChain development controlled by the Ethereum development team
- Limited in the number of transactions due to POW consensus
- The payout of mining is in ETH, so each token on enriching the Ethereum platform
- Possible replacement of the Ethereum platform by new, more efficient ecosystems; EOS, NEM
Conclusion
The Ethereum platform is a beautiful, easy-to-use ecosystem for automated application development. Simple to use since the application developer does not have to maintain their own blockchain. On the other hand, in the case as experienced during the hacking of TheDao, the principle of Ethereum governance can be questioned. The development team making a change to the blockchain to invent funds to pay the stolen amounts, it goes against the basic principles of a blockchain that wants to be incorruptible and irreversible. The hacking was not due to an error in the Blockchain but to an error in the programming of TheDao contracts. The reliability of smart contracts is only equivalent to the quality of its programming. If flaws or errors are made during programming, subsequent transactions could not be recovered. In theory, in practice this seems to depend on the importance of the funds that the error has generated and probably also the proximity of the creators of TheDao and Ethereum governance
In addition, block processing congestion and the amount of energy consumed by the POW consensus makes it a limited platform for the amount of transactions per second. And now, has the price of Ethereum rise, problem emerge. Let see what the future holds for Ethereum, several great projects are coming out, promising to surpass Ethereum's performance. Are we going to witness the decline of this one? Only future can tell...
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Very lengthy article about ethereum
There is quite a lot to say too 😉