Ethereum is a blockchain specifically used for smart contract execution, autonomous organizations, and decentralized applications. Everyone has open access to digital money and customized data services through Ethereum. It is a technology built in the community behind thousands of applications and cryptocurrency ether (ETH). Ether is also known as a “token” because enough “gas” or ether to run a program must be turned on to execute a smart contract or transaction using the Ethereum blockchain. This means that ether is the price to pay for programming code on the Ethereum blockchain.
Ethereum was invented by Vitalik Buterin, who was only an 18-year-old teenager in 2013. His idea cheered in the global blockchain community, after which British computer programmer Gavin Wood proved that the system invented by Buterin was possible to create. Together, they became the first members of the Ethereum team and raised $ 18 million to develop the project. On July 30, 2015, they launched the first version of the cryptocurrency platform Ethereum, called Frontier. On August 7, 2015, Ether (ETH) was added to the Kraken crypto exchange at a price of $ 2.77 per coin. In 2019, DeFi became the largest sector in Ethereum as activities in the decentralized financial market and gaming increased significantly. On August 4, 2020, Ethereum launched the final Ethereum 2.0 testnet which made the network faster, cheaper and more scalable.
Cost-effectiveness of mining :
The profitability of mining has a significant impact on ether prices. The profitability of mining is relatively high when the price of ETH is between 300 and 400 US dollars. Miners usually sell their coins at a better price when profitability is high. If profitability becomes low after many people start mining, other miners will stick to coins and wait for sales until prices become more favorable. This means that the nature of mining tends to fluctuate ETH / USD prices.
Ethereum became the second most popular cryptocurrency in the world on the market when the popularity of the Ethereum blockchain exploded. ETH prices reached $ 1,400 in January 2018 due to its increased popularity. Eventually, however, prices fell and have remained above $ 300 ever since. In the cryptocurrency market, recent trends associated with a particular cryptocurrency can greatly affect its prices.
Because many cryptocurrency transactions are cross-border, they are affected by changed regulations in any country. Thus, whenever the word ‘regulation’ appears in the cryptocurrency market, it negatively affects cryptocurrency prices. In September 2017, China banned ICOs and crypto trading that quickly lowered ETH prices to nearly $ 220 from $ 400.
Subsequently, South Korean threats to regulations also led to a significant drop in investment inflows. However, if a country changes regulations to accept the cryptocurrency market, it would have a positive impact on ETH prices.
Cryptocurrency exchanges do not have the necessary infrastructure for the rapid growth of cryptocurrencies like Ethereum because they are relatively new. Some exchanges offer limited accounts, and some have even stopped accepting new accounts as they improve their support capabilities. Security breaches and software updates affect cryptocurrency exchanges, and this can affect cryptocurrency prices.
Whenever Ethereum gains popularity and is embraced by a large corporation, Ethereum prices rise. This is because the adoption of Ethereum reflects the increased demand for coins. It is technical that when more people adopt a currency, prices rise, especially when the new user is large.
Many people use Ethereum because the future potential of Ethereum is very stable. It is a platform that has thousands of applications for a wide variety of people. Technical companies are rapidly incorporating smart contracts, blockchain and automation into their day-to-day operations, and Ethereum provides a platform for this purpose. Many companies using smart contracts are emerging in the market which has increased the price of Ethereum.