Ethereum - is not ‘just a cryptocurrency’ but an entire decentralized convention of shadowy super coders.
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Ethereum is an open-source blockchain that is decentralized and has smart contract functionality. The native cryptocurrency of Ethereum is known as the Ether(ETH). It is the second most popular and valuable cryptocurrency after Bitcoin.
The idea behind Ethereum was first conceived by the programmer Vitalik Buterin in 2013 in the Ethereum whitepaper which was published in 2013. Other founding members include Gavin Wood, Joseph Lubin, Charles Hokinson, and Anthony DiLorio. The Ethereum network went live in July 2015 after a public crowd sale to create funding in 2014. Participants bought the Ethereum token Ether by using Bitcoin.
## **Biggest Claims to Fame**
Ethereum allows for the deployment of decentralized applications on the network. These applications are permanent and allow for user interaction. Features such as smart contracts on the Ethereum platform allow for the formation and use of applications in gaming, supply chain management, web browsing, finance, and more. Its user control, security, and efficiency make it an attractive choice to anyone who would like to use the platform.
The platform can and has been used as a platform to launch initial coin offerings(ICOs) for other cryptocurrencies. The ERC-20 token based on the Ethereum blockchain can be utilized by up-and-coming cryptocurrencies to gain value for their own cryptocurrencies. Through the use of Ethereum’s open-ended smart contract protocol, developers can create tokens with ease. The smart contracts can also calculate and verify the amount of money being created during the ICO with ease and in a trustless manner.
Ethereum allows users to create and sell NFTs. These tokens that represent the ownership of unique digital items allow for the tokenization of things such as collectibles, art, and real estate. Only one owner is allowed for the NFT at the time. Ethereum allows for the creation of these NFTs and the selling of them. The Ethereum blockchain is responsible for securing the ownership and authenticity of the NFTs.
Ethereum allows for the lending and borrowing of assets without the need for traditional financial institutions. People can lend and borrow using their holdings as leverage. As the largest smart contract blockchain on the decentralized finance market today, Ethereum can allow users to lock their cryptocurrency in lending agreements. Investors can then provide the currency borrowers require for a profit with ease and being assured that their money will not get lost. Users get to lend and borrow without the middlemen present in traditional banking institutions which means they get to customize the contracts directly between lender and borrower.
## **Biggest Criticisms**
Ethereum faces a problem with speed. It can process around 15 transactions per second which means the network congests whenever there is an increase in the number of transactions on the blockchain. An example of this is during the crypto kitties boom in 2017. The Ethereum platform was clogged because of the transaction pileup.
The proof of work system Ethereum uses to process transactions needs a lot of power to run. This means there needs to be an increase in the use of power in places where Ethereum miners are based. This impacts the environment negatively since most of these places use non-renewable sources of energy which pollute the environment.
The programming language to create decentralized applications based on the Ethereum blockchain is difficult to learn or understand. The lack of beginner-friendly classes on learning the language makes it difficult for those who are starting out on programming on the blockchain to make progress. It also takes a lot of time, energy, and money to create an app on the blockchain which locks out a large number of developers.
Ethereum faces a problem with scaling. As they deal in a large number of things like smart contracts and currency exchange, it is very difficult for them to scale up one aspect of the platform without causing issues and bugs to crop up on the other aspects. This is an issue for Ethereum since most of the different aspects work in tandem to each other and such an imbalance can cripple the platform for a long time.
Vitalik Buterin is a programmer and the public face of Ethereum. He was among the founding members of Ethereum. He started as a co-founder of Bitcoin magazine which made a case for Bitcoin diversifying its services for both applications and money instead of dealing in money alone. He briefly worked on the Colored Coins project and wrote the draft of its whitepaper. He broke off after disagreements over the project and founded Ethereum.
## **In Conclusion**
Ethereum is one of the more stable and widely used cryptocurrencies. The benefits and issues are nearly balanced. Despite this, the offer of security for the investment is an aspect investors cannot ignore for all the advantages it brings. Ethereum is planning a launch of an updated version of the platform which aims to solve many of the issues. If the upgrade works as planned, it will make Ethereum a better option than Bitcoin.