Crypto Beginner

7 Slices of Ethereum Birthday Cake

ethereum birthday

Today is when the world’s biggest altcoin turns 7! Ethereum’s been the talk of the town ever since it launched back in 2015. It has spearheaded or contributed to every significant blockchain revolution that many of us invest in. So, we’d like to take this opportunity to give it the appreciation it deserves.

What good is a birthday without cake? 🎂

Here are seven slices of the Ethereum birthday cake, each representing elements of Web3 that came into existence because of Ethereum.

🍰 Decentralised Finance

DeFi is our first slice because some say ETH is the only reason it even became a thing. You see, bitcoin is HUGE, but it can’t take Ethereum’s place because bitcoin can’t do things Ethereum can. Ethereum isn’t just a crypto asset but a software development platform. E-commerce websites, decentralized banks, and dApps – stuff that’s the rage today are built majorly on Ethereum.

The network had more than $150 billion locked in DeFi applications last year, with values only going up. The premise of the BUIDL movement, or the drive to keep developing real-world applications on the blockchain irrespective of price, is based on Ethereum’s strong foundations.

🍰 Smart contracts

If Ethereum is the Hulk, smart contracts are the gamma rays – it’s the stuff that turns Ethereum from a soft-spoken, bespectacled blockchain to a super hero that fights consolidation of central authority. 🙂

Smart contracts were first implemented on Ethereum. They form the basis for everything happening on the network today – from DeFi development to NFT trading. With smart contracts, the network can execute enforceable agreements between multiple parties using nothing but code. Thanks to recent development frenzies, these contracts are the future of blockchain decision-making, and we only have Ethereum to thank for that.

🍰 NFTs

Ah, the most significant art revolution of our generation. Digitization of artwork through NFTs is a blessing not only for artists who can now monetize their work efficiently but also for collectors who save themselves the trouble of authenticity verification and maintenance.

Ethereum was the first network in the world that allowed artists and buyers to track ownership digitally. ERC-721, an ETH token standard, was specifically created to lay the foundation for minting NFTs. Roughly $15 billion worth of NFTs have traded on OpenSea in ETH alone this year.

🍰 Layer 2 tokens

Now before you say anything, we know Ethereum didn’t actually create Layer 2 tokens. They’re different projects, sure.

But hear us out. These projects wouldn’t exist if Ethereum didn’t have such immense functionality. Because it does, people demanded better solutions and lower transaction times. Projects like Polygon and Solana exist because they want to improve the Ethereum experience, which puts a pin on Ethereum’s importance.

Note: Most standalone projects use ERC-20 tokens for native purposes, which is why there are over 450,000 tokens based on Ethereum today.

🍰 Decentralised Autonomous Organisations (DAOs)

First launched on Ethereum in 2016, DAOs allow organizations to work autonomously without needing a centralized authority. It enables all participants to vote unanimously on proposals and decide what’s best.

In a DAO, the larger your stake is, the more you have to gain from making a good decision. UniSwap is one of the biggest DAOs today; the DeX records millions of dollars worth of coin trades daily.

🍰 Decentralised Apps (dApps)

Decentralized apps look and feel exactly like regular apps. They’re more efficient, data-private, and don’t face downtime issues. Almost every functionality imaginable today has a decentralized alternative that’s either fully functional or in active development.

Ethereum is, by far, the biggest dApps development platform hosting more than 3000 functioning apps on more than 5000 smart contracts. Second place only hosts 10% of that number.

🍰 Initial Coin Offerings (ICOs)

Every new coin needs investors to buy into the project and raise money to get the word going. The initial launch is called the ICO, and Ethereum is one of the largest currencies that conducted an ICO. Since ETH came with its own scripting language,  raising funds through digital, enforceable contracts became super simple.

This ease of development and flexibility, combined with the rising market cap of Ether and a desire by early stakeholders to re-invest in the Ethereum ecosystem, made Ethereum the platform of choice for crypto-asset entrepreneurs.

(More techy info on ICOs here.)

🍒 The Cherry on Top

Ethereum isn’t some uncontested, unchallenged god of crypto. (That’s Bitcoin).

There’s a lot of competition now. Cardano, Solana, Algorand, and other altcoins quickly catch up to Ethereum with shinier and more efficient protocols. But no one has come close to #2 in market cap, even in the bear market.

Ethereum is the healthy kid, growing fast. With PoS coming in soon, only time will tell if puberty hits it hard.

Until then, Happy 7th ETH! We’re proud of you!

Disclaimer : Crypto products and NFTs are unregulated and can be highly risky. There may be no regulatory recourse for any loss from such transactions. The information provided in this post is not to be considered as investment/financial advice from CoinSwitch. Any action taken upon the information shall be at user’s own risk.

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