Vitalik Buterin first came up with the idea of Ethereum in 2013 at 18, intending to build an open-source platform that would allow for the execution of smart contracts using blockchain. Previously, he was a co-founder and writer for the Bitcoin Magazine news website. He envisioned a platform where users would be able to build decentralized applications on its blockchain. This became the conception of Ethereum.
In the summer of 2014, Buterin and the other seven co-founders secured funding for the Ethereum project he had detailed in a 2013 whitepaper. The other co-founders are Gavin Wood (who coded the first implementation of Ethereum), Joseph Lubin, Anthony Di Iorio, Mihai Alisie, Charles Hoskinson, Jeffrey Wilke, and Amir Chetrit.
Ethereum’s first crypto protocol, called Frontier, was finally launched in July 2015. Charles Hoskinson and Gavin Wood have since moved away from Ethereum to work on other projects. Hoskinson moved to Cardano and Wood moved to Polkadot.
Ethereum (ETH) Price History
The majority of people, mostly novice crypto investors, often use Ethereum to refer to the cryptocurrency, which is technically inaccurate. Ethereum is the platform, and its native digital currency is called Ether – traded as ETH. Although it has managed to compete with bitcoin since 2016, Ether has been through tough times. ETH’s price has shown massive fluctuations over the years but even so, it is still regarded as a relatively stable crypto coin.
Historical course development
The price of Ether during its launch was less than 1 EUR. It then soared quickly at the beginning of 2016 as the Ethereum founders were preparing to launch a more stable protocol called Homestead. In March, Ether posted a high of 11.6 EUR followed by another high of 12.5 EUR in September.
Exploiting a vulnerability in the DAO’s code, a hacker stole around 50.8 million EUR (60 million USD) in ETH from the platform in June 2016. A disagreement on whether to conduct a hard fork to restore the project to its pre-hack state or not led to the splitting of the Ethereum project into two. This resulted in the creation of a new version of Ethereum called Ethereum Classic alongside the original project Ethereum.
The Ethereum project then suffered a distributed denial-of-service attack in September that year. The situation was, however, quickly rectified by carrying out two hard forks.
ETH’s price started gaining upside momentum at the beginning of 2017 when the crypto was launched in eToro. During the first quarter,it recorded an upswing of over 500%. ETH posted a new high of 250 EUR per Ethereum coin in July . The price decline shortly before kept moving up to 295 EUR in September.
It briefly fell to 250 EUR after China’s ban on ICOs but recovered afterward. By the end of the year, Ether’s price had almost reached 400 EUR. The beginning of 2018 was even more successful, and the crypto posted an all-time high of 1,000 EUR on the second week of January. The price then crashed by almost 80% in the next eight months following the end of the ICO rush.
Ether further fell to 160 EUR in the last few weeks of the third quarter of 2018. Partnerships with Samsung and Opera in 2019 , however, helped put the coin back on track. At the start of 2020, Ether was trading at around 115 EUR and rose to 185 EUR in mid-February before falling sharply to 150 EUR in March. It tried rallying between April and July but never got above 225 EUR during those four months.
In the last week of July, Ether started gaining upward momentum that went on throughout August. The coin posted a high of 333 EUR in mid-August. Currently, Ether has a market cap of over 37bn EUR, representing about 11% of the market cap dominance.
What will be the price of Ethereum in 2030?
Based on the Crypto Research Report from June, ETH price is estimated to reach 3,000 EUR and 3,100 EUR in 2025 and 2030, respectively.
Factors that influence the price of Ethereum
Just like Bitcoin and Ripple, Ether’s price at a given time hinges on several factors. It is through the fluctuations in ETH price that investors earn profits in the crypto space. Investors typically sell their cryptos when the prices are high and wait until the prices are low before making purchases again.
The key factors that influence the price of Ether are:
- Supply & demand
- Adoption & growth rate
- Regulations around the Ethereum platform
- Competition against other cryptocurrencies
- Crimes or scandals involving or related to Ethereum
Some of these factors have affected ETH’s price in the past on more than one occasion. Others, such as cybercrime and scandals, occur once in a while but dent the crypto’s price massively. Ethereum has only been around for about five years, but it has had to overcome two hacker attacks in that space.
Is Ethereum a good investment?
As opposed to BTC, Ethereum has initial coin offerings on its blockchain that serve as protection. This is because the ICOs typically have higher volatility. According to popular traders, Ethereum is a good investment as it has massive potential for growth, but it has risks tied to it like any other asset. Some of these risks include limited funds, regulatory conflicts, changes in the ICOs on the blockchain, and project failure probability.
What makes Ethereum unique?
It was Ethereum that brought about widespread adoption and use of smart contracts. Smart contracts are programmable contracts (or transaction protocol) designed to execute when specific predetermined terms and conditions are met. These contracts were developed to eliminate the need for trusted intermediates between contractors and lower transaction costs.
In the words of Gavin Wood, the blockchain was built to serve as “one global computer for the entire planet.” As of August 2020, Ether had a circulating supply of 112 million coins. 72 million of these were obtained from the first-ever (genesis) block on the ETH blockchain. 60 million of these had been assigned the crowd sale original contributors that funded the project and the rest allocated to the development fund.
The other 50 million coins have been generated as block rewards to ETH miners. Initially, the reward was set at 5 ETH per block but was later decreased to 3 ETH in 2017 before being reduced to 2 ETH last year. On average, an Ethereum block is mined in 15 seconds.
Well-known use cases of Ethereum include:
- Decentralized finance (DeFi) where the Ethereum blockchain is used as an intermediary
- Initial Coin Offering that involves crowdfunding via the sale of tokens
- Stablecoins which are fiat pegged virtual currencies such as USDT, USDC, PAX and BUSD
Ethereum has no maximum supply limit. Although Buterin suggested capping Ether supply to 120 million in 2018, the same has not yet been approved. Ethereum is secured using the Ethash proof of work algo from the Keccak family of hash functions. The founders, however, intend to move to Ethereum 2.0.
There are different ways of storing Ether, but the most convenient is through an Ethereum based wallet. Some of the trusted wallets are Metamask, MyCrypto, and MyEtherWallet
Ether is used to pay for transaction fees called gas in the Ethereum network. Gas facilitates operations on the Ethereum network. In technical terms, gas is the unit of measure on the computational effort required to complete a transaction or execute a smart contract. Generally, complex operations require more gas to complete.
Relationship between Ether and other cryptocurrencies
Information on how Ether relates to other cryptocurrencies is useful when considering which crypto to invest in.
Ether is considered as the best alternative to Bitcoin and is the second most valuable crypto coin in the world after Bitcoin. The Ethereum network recently set a two-month record streak of exceeding Bitcoin in terms of transaction fees. Ethereum adoption and growth rate in the last five years has also been more significant than Bitcoin’s.
Ripple (XRP) is currently the third largest crypto in terms of market cap. At one time, XRP moved up to the second place, surpassing Ethereum. Ripple’s network has a 100 × higher transaction rate than Ethereum’s. While the latter can manage 15 transactions per second, XRP can handle as many as 1,500 transactions per second. Ripple also has a pre-mined total supply of 100 billion tokens, whereas Ethereum has no maximum supply.
EOS.IO is arguably the second most popular smart contract blockchain platform after Ethereum. It is new and not as developed as Ethereum. The platform can handle as many as 3,000 transactions per second. Its native crypto EOS has a market cap of over 2.1 bn EUR.
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