Ethereum, or more specifically in this case the Ether Token, currently has a circulating supply of 107 Million coins with a price per coin of $221 as of 7/21/2019. This gives it a market capitalization of nearly $24.7 billion. This market capitalization is large enough to put it in 2nd place on the market capitalization ranking scale, right behind bitcoin. You can find the entire market capitalization rankings on the coinmarketcap website.
Ethereum was one of the largest projects to be created after Bitcoin. It’s creator, Vitalik Buterin came up with the concept in 2013 and the network went live 2 years later in 2015. His main goal was to create a decentralized global network that would ultimately solve the client-server model that exists today.
What is the client-server model? All web-based applications store their data on third-party owned servers. This centralized system has security issues as it is prone to breaches and hacking. The solution that Buterin proposed is a decentralized network of nodes (volunteer computers in a large scale ecosystem) that would essentially work together to keep track and validate data in a more secure fashion than a centrally located server could.
Many people like to compare Ethereum directly to Bitcoin, but this comparison doesn’t really hold true because it is apples to oranges.
Bitcoin was designed with the purpose of being solely a digital payment network while Ethereum was created to be much much more. Ethereum was designed to be a platform that others can “build on top of“.
Similar to how iPhone application developers design apps to run specifically on Apple’s iOS, blockchain application developers can also create applications to run on Ethereum’s network. Applications can vary far and wide and are not limited to payment systems.
Ethereum network makes use of what are called smart contracts. This idea was first conceived of in 1993 by a computer scientist, Nick Szabo. These are (in the most simple terms) agreements that execute some transaction exactly as they are designed to do so automatically between the parties in the agreement. Ethereum’s whole platform is built on the idea that users can create these smart contracts among themselves. Learn more about what smart contracts and how they work here.
Thank you for reading this week’s Coin of the Week and we hope you have learned something new!