How has Ethereum, the second largest cryptocurrency, evolved from yesterday to today?
Home of smart contracts and decentralized applications (dApps) Ethereum holds the bulk of TVL in the industry. In particular, Ethereum’s dominance in the dApp market stands out. Until competing platforms were created, Ethereum held close to 90 percent of the market power. Although its current dominance is decreasing, it continues to be the first choice.
Ethereum is seen as a hub beyond dApps. Examples such as being the second largest cryptocurrency and working with the PoS system give priority to Ethereum. So what has brought Ethereum successfully so far? Here is the path Ethereum followed from yesterday to today.
2013 – The Birth of Ethereum
Russian-born Canadian computer programmer Vitalic Buterine Whether you call it inspiration or a new idea, it came up with a project that didn’t make the known. Buterin’s idea was to leverage blockchain technology to develop decentralized applications, unlike Bitcoin, which was developed for financial use.
Buterin first came up with the concept of Ethereum by publishing a whitepaper in 2013. The whitepaper explained the concept of the new technology, its core principles, and possible use cases. Although this laid the foundations of Ethereum, the project had a two-year process to come to life.
By the first year (i.e. 2014), Buterin officially announced the launch of the Ethereum ecosystem, inviting volunteers, developers, and investors to join the project. Among the primary core developers of the program Gavin Woodand Jeffrey Wilcke was located. Among other founding team members Anthony Dilorio, Joseph Lubinand Cardano Founder Charles Hoskinsonthere was.
Three months later, Wood Ethereum Virtual Machine (EVM) has released the “Yellow Paper” of the project, which provides a detailed description and specification of the Ethereum ecosystem, including fee rewards and smart contracts for miners. Wood also played a key role in prototyping Ethereum by helping to code the first functional implementation of the project in seven programming languages.
2014 – Ethereum Sprouting
Ethereum developers needed huge funds to build the project. Therefore, the team decided to raise capital from public investors through an initial coin offering (ICO) that lasted 42 days from July 20 to September 2, 2014.
In June 2014, the project established the Ethereum Foundation, a Swiss-based non-profit organization to manage the legal and marketing efforts of the ICO campaign. The foundation has created a total of 60 million ETH, the native cryptocurrency of the Ethereum ecosystem, for public sale. The company sold 2,000 ETH per Bitcoin (BTC) in the first two weeks of the ICO and 1,399 ETH per BTC during the remainder of the token sale event.
Interestingly, the Foundation sold over 50 million tokens in the first 14 days of crowdfunding, and by the end of the campaign, the project had raised a total of 31,531 BTC worth over $18 million. This made Ethereum crowdfunding the fifth most successful ICO in crypto history (at the time).
The nonprofit also created another 12 million ETH, bringing the total minted ETH to 72 million. The company said the additional tokens will be used for marketing and other development activities.
2015 – Ethereum on the Competitive Stage
About two months after funding, ETH DEV announced that Ethereum DEVCON-0held its first event, called Ethereum, which hosted Ethereum developers around the world to discuss the security and scalability of the protocol.
In April 2015, the Foundation launched DEVgrant, the first grant program to support the best projects in the Ethereum ecosystem prior to the pre-launch of the platform, and the program continues to this day.
In May 2015, the Ethereum development team launched a test version of the network that focused on four areas: transaction efficiency, virtual machine usage for smart contract execution, mining capability, and stress testing. Olympic published the . The foundation rewarded test takers with 2,500 ETH and other prizes in each category of the testing phase.
Public Opening (Frontier)
Following the Olympic testing phase, Ethereum officially went live on July 30, 2015, nearly two years after Buterin published the whitepaper of the project.
The first public release of the project, known as Frontier, aimed at developers and technical users, marked a major milestone for the team. While the protocol would later go through a series of upgrades as it matures, it was the birth of a new blockchain ecosystem for decentralized applications of all kinds.
Ethereum’s Ice Age
The Ethereum development team hit 200,000 on September 7, 2015. Introduced Ice Age on the block and with it the difficulty bomb. This is a difficulty adjustment scheme designed to increase the mining difficulty on the network after every 100,000 blocks, thus making it impossible for miners to keep up with the increasing difficulty level. This caused the network to freeze over time, hence the name “Ice Age”.
This feature was implemented to ensure consensus in the ecosystem for future upgrades that would migrate Ethereum to a proof-of-stake (PoS) consensus network.
Homestead Upgrade
The team launched an upgrade called “Homestead” at block 1150000 on March 14, 2016, nearly a year after Frontier went live. The new version came with GUI thus making the platform useful for non-technical users.
The fork has also enhanced the platform with Ethereum Improvement Proposals (EIP) so that the platform can run future upgrades.
2016 – DAO Attack on the Road to Upgrade
on April 30, 2016 Ethereum The Decentralized Incorporated Organization (DAO) was created on the block numbered 1428757. The DAO has raised $150 million worth of ETH from over 11,000 investors, but no one knew that success would not last long.
Just three months after its launch, the DAO was hacked because its developer implemented the project without careful auditing. The attacker moved around 3.6 million ETH, worth $60 million at the time, from the platform, which led to the controversial fork of the Ethereum network to recover stolen assets.
This event gave Ethereum its first real existential threat. The failure of the DAO would have devastating consequences for the emerging blockchain network, in addition to financial losses for investors, as the DAO had become one of the largest projects in Ethereum.
The Ethereum community tried a soft fork to avoid making permanent changes to the blockchain, but it didn’t work. A hard fork was then performed and the funds were restored and returned to the investors.
Ethereum’s hard fork after the DAO attack created a new blockchain. original network Ethereum ClassicWhile being rebranded as Ethereum, the new chain retained the Ethereum name.
2020 – Ethereum Inspired by Rocky: Rise as it Drops
After getting through the DAO thing, Ethereum’s next big challenge was scalability. Like Bitcoin, the Ethereum blockchain is a concept first used by Buterin to describe the basic functions of the blockchain network. Blockchain Trilemmawas faced with.
The Ethereum co-founder states that security, decentralization and scalability are three desirable elements of a blockchain network. However, it is difficult for a blockchain to have efficient levels of these three features simultaneously. In other words, it has to sacrifice one key feature to optimize the other two.
By late 2017, Ethereum had become a favorite smart contract platform for dApp developers. The network also took advantage of the bull market enthusiasm that year and the blockchain game CryptoKitties attracted crowds to the Ethereum ecosystem. This has led to network congestion, with transactions taking longer to be confirmed and gas prices skyrocketing.
An upgrade was implemented in December 2020 to address scalability issues, marking the beginning of the network’s transition from PoW to PoS.
upgrade, Ethereum PoW Mainnet It created a separate PoS chain called Beacon Chain that runs parallel to . Both chains would later merge to form a single network called Ethereum 2.0 or ETH 2.0. However, the Foundation changed the new name to “Consensus Layer”, stating that ETH2 sounds like a new operating system, but that is not the case.
2022 – Ethereum’s Historical Merge Era
The Ethereum development team has released several updates in preparation for Merge after the release of Beacon Chain. Some of these updates were Altair and Bellatrix.
The following statement was made by the Ethereum Foundation:
“Merge represents the merger of Ethereum’s existing execution layer (the mainnet we use today) with the new proof-of-stake consensus layer, Beacon Chain.”
Ethereum Merge was implemented with an upgrade called “Paris” in block 15537393 on September 15, 2022. During the upgrade, more than 13.4 million ETH coins were deposited into the deposit contract. The bifurcation saw Ethereum transition to PoS consensus nearly two years after the Beacon formation.
So what happened to Ethereum’s PoW miners after Merge? The Ethereum network has been forked to create a separate chain (similar to Ethereum Classic). This blockchain is called proof-of-work Ethereum (ETHW) and allows miners to continue validating blocks by solving complex mathematical puzzles for ETH rewards.
How Will the Future of Ethereum Be Shaped?
With the successful implementation of Merge, the next major upgrade in Ethereum will be Sharding, a multi-stage upgrade designed to improve the scalability and overall capacity of the protocol. This is known as an on-chain scaling solution.
Sharding will work synergistically with layer-2 aggregations while splitting the entire Ethereum network into independent partitions called shards, thus increasing the throughput of the network by up to 1000x. Besides scalability, Sharding will bring other benefits to Ethereum such as greater network participation and improved decentralization.
The upgrade is expected to be fully implemented in 2024 or later. This means that until then, Ethereum will likely continue to rely on off-chain scaling solutions like layer 2 and sidechains.