ETH floats towards the top
Ethereum’s rise to become the world’s second-largest cryptocurrency was born out of a vision to use blockchain technology as more than a traditional currency alternative.
This vision was first brought to light by Vitalik Buterin, a Russian-Canadian, in a white paper he wrote in 2013.
While he had become an ardent follower of bitcoin, he was adamant that blockchain could also be used to develop apps and aid business operations.
When word got out about his idea, interest soared and he was awarded a $100 000 grant by the Thiel Fellowship [https://thielfellowship.org/].
He released Ethereum to the world alongside co-founders Gavin Woood, Anthony Di Iorio, Jospeh Lubin and Charles Hoskinson in 2015.
Proof is in the stake
Ethereum, whose token is known as “ether” or “ETH”, is a completely decentralised entity and is not regulated by a financial institution or governing authority.
While decentralised apps running on a peer-to-peer network (dApps) are its major calling card, it has proved successful in its own right as a transactional blockchain and holder of digital assets.
Non-replicable non-fungible tokens (NFTs) such as property or digital art assets may now be common, but the first to ever be built was on Ethereum’s blockchain.
Another differentiator is that Ethereum has no limit on supply.
Rather, availability levels are determined by its own supply levels which are aligned with demand.
Blockchain transactions also rely on the “proof of stake” (PoS) model for validation.
This requires participants to stake at least 32 ETH and implement Ethereum-specific validation software.
Ethereum’s legacy crypto rival Bitcoin operates on a “proof of work” rather than PoS system.
This model involves block rewards being unlocked by solving computational “puzzles”.
Blockchain’s price surge
The growth of Ethereum since 2015 has captivated the crypto community.
The Ethereum price began life at a very modest $0.42/ETH and is now a perennial presence in $3-4 000 territory.
Because of its legacy status, it carries far-less risk than smaller newcomers.
This makes it ideal for market participants who favour long-term holding.
Its strengthened position also stems from the surge in popularity of decentralised finance (DeFi).
When global brands like Visa and PayPal are making use of DeFi, it becomes clear that this is a trend that will not be going anywhere anytime soon.
What is significant is that there are around 150 DeFi dApps that have been built using Ethereum.
Notably, more than 50 non-crypto firms have already flocked to the blockchain.
Aside from 20 financial specialists, it has attracted the likes of apparel giants like Louis Vuitton and Adidas.
The non-crypto interest largely lies in Ethereum’s tech infrastructure.
It stands to reason that with more of these businesses using the network, the demand for ETH will increase.
The result will be even higher prices moving forward – some analysts even suggesting it could reach $60 000 by the end of the decade.
