Ethereum Cryptocurrency (ETH)

In 2013, Vitalik Buterin proposed a decentralised blockchain platform, which revolutionised trust, autonomy, and innovation. This concept, later used in Ethereum cryptocurrency, expanded beyond Bitcoin's limitations and opened up a world of programmable possibilities.

Ethereum cryptocurrency, introduced in 2015, revolutionises technology by enabling decentralised applications and smart contracts, sparking a decentralised revolution and promoting an autonomous, open society.

Ethereum mining uses Proof of Stake (PoS) instead of Bitcoin's PoW consensus, with Ether (ETH) as the native coin for user rewards and network fuel.

Who is the Founder of Ethereum Cryptocurrency?

Vitalik Buterin, founder of Ethereum, was awarded a $100,000 Peter Thiel Fellowship to develop the network, which he initially started with a white paper on a next-generation smart contract.

Ethereum cryptocurrency, initially proposed by Vitalik Buterin, has been supported by other founding members, including Charles Hoskinson, Gavin Wood, Anthony Di Iorio, Amir Chetrit, Jeffrey Wilcke, and Mihai Alisie.

What are the Features of Ethereum Cryptocurrency?

Technology behind Ethereum Cryptocurrency

Ethereum cryptocurrency is made up of several core components that work together to create a decentralised, programmable, and secure blockchain platform.

• Blockchain: The Ethereum cryptocurrency is a distributed, tamper-resistant, and transparent system that organises transactions and smart contract interactions into blocks. Each block is authenticated and timestamped, and when completed, it becomes a permanent part of the ledger. The blockchain is immutable, ensuring data integrity. The consensus mechanism ensures transaction authenticity, making it difficult for malicious actors to modify records. Each transaction and interaction is independently verified by nodes, providing a secure environment for peer-to-peer transactions and laying the groundwork for decentralised applications and digital assets.

• Ethereum Virtual Machine (EVM): The Ethereum Virtual Machine (EVM) is a crucial part of the Ethereum cryptocurrency network, responsible for smart contract execution. It operates on every node in the Ethereum cryptocurrency network, ensuring consistent execution across all participants. The EVM provides a sandboxed environment, preventing interfering smart contract executions and ensuring network integrity. It also has a gas system to allocate compute resources and prevent network abuse. The EVM uses a deterministic execution model, ensuring predictable behaviour and allowing participants to validate contract execution. It also has its own set of opcodes, which specify the operations of a smart contract. This ensures the execution of smart contracts is safe and without harm to the network.

• Solidity: Solidity is a high-level programming language designed for writing smart contracts on the Ethereum cryptocurrency. It defines the vocabulary and structure of smart contracts, allowing developers to describe their functionality, data structures, and interactions. Solidity supports modularity by allowing self-contained blocks of code to be inherited and reused, increasing code reusability and complexity. It also supports contract inheritance, allowing developers to design contract hierarchies and specialised contracts. Libraries, reusable chunks of code, reduce code redundancy and improve maintainability. Solidity also includes an event system for contract occurrences, allowing external entities to respond to specific events. It also provides features for bespoke data structures, user-defined types, and security features, such as access modifiers and protection against vulnerabilities like reentrancy attacks and integer overflow/underflow.

• Ethereum PoS Consensus Mechanism: Ethereum cryptocurrency initially used a Proof-of-Work consensus mechanism, Ethash, similar to Bitcoin. In September 2022, it transitioned to Proof of Stake as part of the Ethereum 2.0 Upgrade. This shift ensures valid mining by validating ETH as collateral, preventing dishonesty or laziness.

• Token Standard: Ethereum cryptocurrency facilitates token creation and standardisation through two prominent token standards: ERC-20 and ERC-721. ERC-20 is widely used for creating fungible tokens, allowing easy integration with various apps and exchanges. It defines mandatory and optional functionalities for token contracts, including token transfer, balance checking, and token authorization.

ERC-20 tokens are Ethereum cryptocurrency wallet compatible, allowing users to store, transmit, and receive tokens using popular wallet apps. They can be listed and sold on decentralised and centralised exchanges, providing liquidity and enabling token production on the Ethereum blockchain.

What are the Use Cases of Ethereum Cryptocurrency?

• Building Decentralised Finance (DeFi): Ethereum blockchain for choice for developers and businesses inventing technology based on it that will transform how many sectors run and how we live our lives. One of the most interesting uses of Ethereum cryptocurrency is for payments and remittances since it lets you transmit money anywhere in the world without paying transaction fees. By issuing tokens that represent ownership rights, Ethereum technology presents a great method for managing royalties in the music industry.

• Smart Contracts: Ethereum cryptocurrency supports the development and deployment of smart contracts. Smart contracts are computer programmes that are stored on the blockchain and allow traditional contracts to be converted into digital analogues. Smart contracts, like conventional contracts, can set rules and automatically enforce them through programming. Ethereum  makes smart contracts possible, as well as unprecedented efficiency, security, and user control. Ethereum is utilised in finance, web browsing, gaming, advertising, identity management, and supply chain management, among other areas.

• Asset Tokenization: Ethereum cryptocurrency can be used to tokenize assets. Tokenizing assets on the blockchain entails generating digital representations of real-world assets like real estate, equities, or commodities. Tokenizing assets on Ethereum can assist to boost liquidity, lower transaction costs, and make asset trading more convenient.

• Health Applications: Ethereum's blockchain technology can be leveraged in health applications to securely store and manage medical records. Health applications can benefit from better data security, interoperability, patient management, and research capabilities thanks to Ethereum cryptocurrency technology. Storing medical records securely on the blockchain can aid in the elimination of data silos, the enhancement of patient privacy, and the streamlining of healthcare processes.

• Digital Identity Management:  Ethereum cryptocurrency can be leveraged to create a decentralised identity management system that offers enhanced security, transparency, and user control. Individuals can gain more control over their personal information by employing Ethereum for digital identity management, while organisations can benefit from quicker identity verification processes, decreased fraud, and increased data security. Ethereum's decentralised and transparent nature aligns well with self-sovereign identification concepts and can lead to a more secure and user-centric identity management environment.

• ICO Platforms: Ethereum cryptocurrency has been widely utilised as a platform for Initial Coin Offerings (ICOs). ICOs have revolutionised the way startups and projects raise funds by leveraging the blockchain technology. The Ethereum ICO platform has made it possible for entrepreneurs to generate funding and engage with a worldwide community of investors. It has allowed for the funding of disruptive projects and breakthroughs while also fostering transparency, programmability, and inclusivity in the fundraising process.

• Payment Gateways: Ethereum cryptocurrency and its native token, Ether (ETH), can be used as a means of payment, similar to Bitcoin and other cryptocurrencies. The features of Ethereum as a payment gateway provide consumers and businesses with an alternate, decentralised, and efficient means of conducting transactions, broadening the possibilities for digital commerce and financial relationships.

The Merge in Ethereum Cryptocurrency

The Merge was the final step in the Ethereum 2.0 upgrade, which saw the current Ethereum cryptocurrency mainnet merge with the Beacon Chain in September 2022. The Beacon Chain is the key component of the Ethereum 2.0 upgrade that serves as the consensus layer for the Ethereum network. 

What is it?

The Merge, a shift from Ethereum's Mainnet to the Beacon Chain, reduced energy consumption by 99.95% and eliminated the need for energy-intensive mining, thereby securing the network.

TOKEN HOLDINGS