Ethereum ETH is an open source blockchain platform that allows anyone to create and distribute decentralized applications (DApp). The project was initially proposed in a White paper in 2013 by a 19-year-old Vitalik Buterin.
The purpose of Buterin was clear. Instead of betting and building every single case on blockchain, he wanted to create something that could be used to create anything on blockchain – whether it's custom cryptocurrencies, financial tools, smart properties, decentralized storage systems, self-organization decentralized (DAO) non-fungible resources, identity management solutions or anything else you can think of. And he wanted users to do it "by writing the logic in a few lines of code".
The project went live on July 30, 2015 with the launch of its genesis block. "The vision of a censorship-proof "world computer" that anyone can program, paying exclusively for what he uses and nothing more, is now a reality. "The Ethereum development team said at the time.
So far, it does not seem to have worked that way. Instead of being home to significant blockchain-based applications that provide real-world utility, Ethereum has ended up becoming a breeding ground for the controversial first-rate coin offerings (ICOs) – which are more often scams than not.
In a rare scenario where a DAP called CryptoKitties gained traction, it ended up blocking the Ethereum network, greatly slowing down the speed of the transaction and increasing costs.
The developers of Ethereum did not give up though. The team worked on the implementation of various technologies with the Ethereum network to solve scalability problems.
Review of ETH / USD performance
ETH posted gains of over 8.800 percent in 2017, closing at $ 712 on the last day of December, not a surprise given the rush to the overall cryptocurrency market.
The cryptocurrency continued its rally in the first half of January, breaking to $ 1397 on January 14th. ETH saw an important market correction of 18.5% on January 16th.
Once again it mobilized to trade at $ 1,250 on January 29, but soon saw a sharp decline to $ 697.95 on February 6, its lowest price in 2018 at the time. .
The ETH market briefly recovered only to slip further, trading at $ 395 by March 30th. He made another short recovery in May, trading at $ 816, still 42% lower than the price he was trading on January 14th.
This was the last significant recovery for ETH as the downward trend dominated for the rest of the year. In December last week, cryptocurrency declined to $ 101.09, marking a loss of nearly 93% of the market price compared to January 14.
Also in 2018 ETH behaved badly with respect to BTC, losing 47% of its relative value in the course of the year. ETH lost the competition despite having gained 116 percent in January.
Ethereum – Major events in 2018
Ethereum began the year with the fear of scalability given by CryptoKitties, forcing him to work on his latest implementation plan, called sharding.
In February, Buterin mentioned the possible implementation of sharding with the network. In a research paper co-authored by two researchers from the University of London College (UCL) in September, he said that sharding can successfully help the Ethereum scale without compromising network security in any way.
But it was just one of the many developments planned to improve the scalability of Ethereum.
In March, Buterin proposed further improvements to the Plasma solution, which was co-authored with Joseph Poon of Lightning Network the previous year.
Buterin said that rather than having to download the entire chronology of plasma as previously suggested, under the new proposal users would instead be able to generate "plasma coins" by sending a deposit to the contract. "The main advantage here is that basically the amount of data that clients have to process varies greatly," he explained.
In March, the Ethereum Foundation announced several grants to ongoing projects on the Ethereum blockchain that are working to improve the 'scalability, usability and security of the network'.
In September, Buterin wrote that zkSnarks, a form of cryptography espoused by zcash could help the scale of Ethereum, without having to rely on second-level solutions like Plasma or Raiden.
In November, Coindesk reported that the developers of Ethereum are working on a secret scaling solution called "ethereum 1x", which could be implemented by June 2019.
The total supply of ETH also exceeded 100 million in June, raising concerns over the economic aspects of cryptocurrency. Without any mechanism to control the offer, the market price of ETH is likely to suffer a decline over time due to unbalanced supply and demand.
In June, in the United States William Hinman, head of corporate finance at Securities and Exchange Commission (SEC), made it clear that Ethereum is not a security and therefore is outside the legal field of the agency. In December, the US Commodities Futures and Trade Commission (CFTC) requested public comments on Ethereum Network to help it understand the underlying features of the blockchain project.
Ethereum has had a good year in terms of adoption. In January, the The National Research Council of Canada (NRC) has tested the network to preserve government documents. Similar implementations have also been made by Austria Oesterreichische Kontrollbank (OeKB) and the Australian Commonwealth Bank (CBA).
The first version of Casper – a planned change in the way in which the consensus on the Ethereum blockchain is reached – was published in May. Headquarters in the United Kingdom The digital asset trading service Crypto Facilities also launched Ethereum Futures the same month. In August, BTC.com – a subsidiary of Bitmain and the world's largest cryptocurrency mining pool – has released a new client specifically built to extract ETH.
In September, a system-wide update was called Constantinople was finalized by including five different proposals for ethereal improvement (EIP). The upgrade, if it happens, will be a difficult fork with the nodes that have the ability to upgrade with the whole system or to exist as a separate entity. According to Coindesk, the fork could happen at the beginning of 2019.
What to expect in 2019
Many blockchain platforms have popped up from Ethereum to allow users to create and deploy decentralized applications and smart contracts. But Ethereum retains the first advantage of mover and the majority of the market.
The year 2018 was not the best for Ethereum. The market performance of its cryptocurrency ETH was worse than most of the other top ten currencies (by market capitalization). The network probably did not make much progress on scalability because the Ethereum Foundation could have hoped to move forward in the year. DApps on the network are not making any waves in terms of popularity or innovation.
Despite everything, Ethereum still has a lot of work for it. For starters, it shows even more technical strength than any of its competitors. The network has also remained more closely linked to the principles of decentralization than other blockchain platforms.
When it comes to a "curriculum blockchain", few companies can claim the greatest number of Ethereum sector veterans and the team continues to inspire investor confidence.
The year 2019 has more competition waiting for Ethereum and the bases behind the network should work to ensure that the promises made in 2015 are met. The platform needs the best DApp running on it – and it works effectively. It is also impertinent to ensure that the Ethereum developer community is committed to a common goal, rather than being divided across every aspect of the network, as in 2018.
The Ethereum Team has a lot of work in sight in 2019 and the way they implement the many changes expected with the network is what will likely determine the performance of ETH during the year.
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Published December 30, 2018 at 09:00 UTC