Ethereum, the second-largest cryptocurrency by market capitalization, is celebrating its 10th birthday this week. What Ethereum is, how it works, and what makes it different Vitalik Buterin officially launched Ethereum on July 30, 2015. Since then, it has revolutionized the blockchain arena and continues to power the development of decentralized applications (dApps) and smart contracts.
Ethereum’s journey started with the dream of a platform that was more than digital currency. Its primary goal was to allow developers the freedom to create any decentralized application they wanted, that could run on its blockchain. This groundbreaking innovation has unlocked a world of possibilities within the cryptocurrency ecosystem. It has fueled innovation across sectors, such as decentralized finance (DeFi) and non-fungible tokens (NFTs).
During the last 10 years, Ethereum has gone through several technological advancements and upgrades that have made it more functional and scalable. The most exciting upgrade to Ethereum is the move to Ethereum 2.0. This transition, known as Ethereum 2.0, will make the network more efficient by eliminating its current proof-of-work consensus model in favor of proof-of-stake. The change started to roll out in late 2020 and will be fully implemented in 2022. It is focused on drastically lowering energy use and increasing transaction speed.
As Ethereum proudly celebrates this milestone, the community takes time to remember what has been accomplished and what still must be done. The ecosystem has since exploded ever since — there are now more than 3,000 dApps running on the network. These applications have reached across every industry, from finance to gaming, showcasing the potential that Ethereum’s blockchain technology has.
The anniversary isn’t just a celebration, though—it’s an opportunity to focus attention on Ethereum’s profound impact on the global financial landscape. Most importantly, it’s allowed billions of dollars worth of transactions. Moreover, it is the underlying infrastructure for numerous DeFi applications, offering creative financial solutions outside the purview of traditional intermediaries. The rise of NFTs has further showcased Ethereum’s capabilities, enabling artists and creators to monetize their work in novel ways.
Ethereum was equally criticized for its scalability problems and skyrocketing transaction fees in times of peak demand. The network congestion has prompted discussions about potential solutions, including layer-2 scaling solutions like Optimistic Rollups and zk-Rollups. These technologies are designed to relieve congestion on the main Ethereum blockchain, while ensuring the same level of security and decentralization.
Investors and enthusiasts alike are using this anniversary as a way to look toward Ethereum’s possible future path. Most industry leaders hope that the eventual rollout of Ethereum 2.0 will address many of these persistent problems. This technical upgrade will improve the network’s competitiveness against other blockchain platforms.
Along those lines, institutional interest in cryptocurrencies is booming. Because of this, Ethereum’s position – as the dominant platform for dApps and DeFi – will continue to attract more investment. Leading financial institutions are deeply immersed in the ways that Ethereum’s technology can be leveraged to create new opportunities. This advanced interest is encouraging Ethereum’s influence in the crypto market.