Ethereum – The Framework of the Future
The world was abuzz with the sensation Bitcoin provided, as its price per coin skyrocketed in mid-2017. Since then, interest has peaked in cryptocurrencies, but this is not where the story begins. As early as the 1980s, people were searching for a way to transfer money without the use of a centralized system, and early methods, such as DigiCash and NetMoney, ultimately, failed.
In 2009, the peer-to-peer Bitcoin system was quietly introduced, and it would slowly build its network of nodes, miners, and aficionados. In the years since its creation, people have realized it has it drawbacks, and other forms of currency have been invented to close those gaps.
One such coinage is Ethereum.
Ethereum Improves on the Bitcoin Model
Ethereum, or ETH is similar to Bitcoin in that it uses the blockchain, but it differs significantly from its predecessor. ETH was added to by the, then, startup ConsenSys, who gave it its ability to house decentralized apps, and its popularity grew until it even attracted the attention of megaliths like IBM and Microsoft.
The Ethereum platform allows users to create smart contracts written by developers for a variety of purposes, giving it many uses far beyond that of merely trading value. The coding on these applications can run smoothly, as they are uninhibited by outside forces, and users are granted privacy, a benefit untenable with Bitcoin.
These programs can do anything from storing information about the music industry to keeping insurance coverage data secure to filing government documents and more. As its functions continue to grow, industries that provide air travel, banking and real estate transaction assistance have moved components of their businesses to the blockchains, and there is speculation that the medical industry may do so as well.
ETH allows for the programming of additional cryptocurrencies on the foundations it supplies, and its utility in the world of information is indisputable.ETH, however, has another trick up its sleeve: it forms the basis for which many other cryptocurrencies are traded.
ERC-20 and the ICO
ERC-20, which is short for Ethereum Request for Comment (and the number assigned to this request) is the standard used to accept smart contracts. The majority of tokens that exist are compliant with ECR20, and its rules that determine how data is transferred and accessed.
These processes give developers a clear way of projecting the way in which their tokens will function, and it is a popular vehicle for those looking to crowdfund and to present their initial coin offering, or ICO. When a developer wishes to make a new coin and needs capital, he or she can create a whitepaper containing an explanation of how said monetary function will work in order to, hopefully, attract investors.
That same entrepreneur will, basically, be requesting money in the form of ETH or BTC, and in exchange, the venture capitalist is rewarded with coins in the new currency. This, however, is not like the investment world where slices of the pie are awarded to people who initially give; it is, rather, an opportunity to get in on the ground floor of a new financial frontier.
In the digital wild west of cryptocurrencies, there are hundreds of different tokens out there, and a great deal of them have their underpinnings in ETH. Thus, ETH is a sort of hub for the inventions of new trading vehicles available today, and it is a ready harbor for those new ships that have yet to set sail. All that is needed is a startup with programming ability, an indomitable spirit, and the imagination to dream. From there, the sky is the limit.
Our current coin market shows there is no lack of interest in currencies that continue to push the envelope and adds improvements to the models that came before them. The environment for ETH is more than good: it is positively robust. ETH has laid the ground work on which the virtually untapped empires in digital gold are being erected, and its value is set to only increase as time goes by. If we should so choose, its benefits are there for the reaping.
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