Ethereum will change everything – Complete Guide

Ethereum is not only a crypto currency. It’s a complete ecosystem that is being developed under everyone’s noses. Let’s discover where it will lead us.

At first glance it seems difficult to understand Ethereum and where the “value dogs” are buried, but it’s actually not so complicated as it seems. Ethereum’s value lies within its use, its network and the wide range of applications that run on top of it. Aside from shifting into a store of value, it’s THE most used network from the whole crypto space. There are countless red bull gulping programmers building amazing new technologies of tomorrow on Ethereum and will continue to tinker and improve the whole network as we go along. In summary, Ethereum can be compared to the world wide web in its infancy. Let’s dive deeper into how it all began and what the future holds for this amazing technology. 

How it all began 

In short, Ethereum was born out of frustration. Yes, Bitcoin has definitely decentralized the shit out of pretty much everything that the financial elite’s hold dear to their portfolios. It brutally kicked the door of innovation wide open, but for the sake of being as original as possible, the Bitcoin community has remained stubbornly allergic to change. Besides, the code that runs Bitcoin is pretty simple and can’t be used for building epic and awesome tech on top of it. It is only when Vitaly Buterin ( better known as Vitalik ) saw the possibilities of what blockchain tech and decentralisation could do, Ethereum could finally be unchained. In a few short years it will nibble the current financial system to death. 

Vitalik didn’t waste any time and with the help from other smart dudes ( one of which later started Polkadot by the way ) they set out to create a complete new programming language that would allow them to harness the power of decentralised blockchain technology secured by a proof of work system. For the non tech savvy people that simply means a huge network of computers all united into one big ass supercomputer that can run pretty much any program you throw at it. And it’s all nice and decentralised, meaning that you can deploy a program that will just work and will NEVER be controlled by anyone. After all Etereum’s goal is to decentralise the internet! 

In the wake of the colossal worldwide fecal hurricane that was 2020 and now 2021, it’s naive to assume that the huge tech giants have our best interest in mind. If you still believe that, roll up a newspaper and hit yourself on the head a few times. These tech giants can even sensor presidents and other world leaders. To the people who know their history, the whole thing smells awfully like the VOC ( United Dutch East-India Trading Company ). However these modern beasts are sailing the world of the internet and starting wars of censorship and blatant monopolisation of all the aspects of our lives. Yes the digital book burnings are real. 

Even on the infamous 29th of January 2021, when the regular folks from the “Wall Street Bets” subreddit took on the the bloated over leveraged hedge funds head on and actually almost bankrupted a few of them, the powers than be promptly tugged on the reigns, halted trading on big exchanges and smacked a few hundred thousand people on the nose with a rolled up digital newspaper to show them who’s in charge. It’s a precedent that will go down in history as the moment that the normal people finally saw through the thick fecal fog of the financial elites and this is exactly why decentralised technology built on Ethereum will soon make jaws ( and Wall Street’s profit margins ) drop in the process. From the moment the nice folks from the “Wallstreet Bets” subreddit learn to use Ethereum, we will see a new page of financial history being written. Exciting times to say the least! 

 

How Ethereum works 

After reading the article “Bitcoin vs Ethereum” you now know the concept of “proof of work” consensus mechanism whereby decentralised computers are buzzing away and securing a decentralised network. Now that the network is nice, cozy and secured, we can unleash the almighty programming language ( Solidity ) in order to let our imagination run wild and program a countless array of decentralised applications ( called DAPPS ). 

At its core a smart contract is nothing more than a set of conditions like “if … then”. So for example: IF you drink 2 beers, THEN your friends will wave you off and you’ll be able to drive home. IF you have more than 2 beers, THEN your friends will drive you themselves, or kick your ass when you decide to drive on your own. Of course the DAPPS are much more complex, but the point is clear. All Ethereum does is execute these conditions without nagging you about logins, passwords and KYC ( Know Your Customer ) information proving that you’re not a zebra. 

A smart contract pretty much works with every aspect of the transaction that we’re dealing with: enforcement, management, performance and payment. If the gears of imagination in your head have started to turn, then yes, you’re absolutely right! This technology will render many privileged occupations ( like brokers, notaries, agents and other middlemen ) 100% obsolete. What would happen If a smart contract would deal with a dispute in an automatic way? The joke about the lawyers at the bottom of the ocean would suddenly make much more sense. 

Of course we have a long way to go in order to make an awesome world like this possible, since the smart contracts are strict to the letter and have 0 human interpretation of reality. If a landlord programs a smart contract that can lock a tenant out of his/her apartment after 1 day of missed rent, suddenly the soaking wet lawyers would be fished out, resuscitated and put back on the payroll immediately. There is also a matter of the GAS Fees that has to be paid to the Ethereum network in order to crunch all the numbers. Smart contracts are very complex calculations and they require a lot of processing power. Combine this with a growing ecosystem of all the epic new tech that’s clogging up the Ethereum network and you suddenly end up with a huge smelly turd decorating a technologically perfect cake. Scaling solutions and migration to “proof of stake” will hopefully cut down the network GAS fees and replace this problem with whipped cream and sprinkles. Only time will tell. 

Early innovations 

It’s beyond a doubt that one of the coolest early innovations on Ethereum was the phenomenon called Crypto Kitties. This was a marketplace for “non fungible tokens” (NFT’s) in the form of pictures of “user breedable” cats with different looks and traits. Just like Pokémon cards, crypto kitties took the world by storm and unleashed an entire industry where “digital ownership” has become the next big thing. Now we have many bustling NFT marketplaces where entrepreneurial dudes and gals can live out their creativity. You want to make a non fungible token from your vinyl or whiskey collection and sell it for Ethereum? No problem! You’re an artist or musician? Now you can give the finger to labels and art dealers and sell your art directly to loyal fans. You want to sell socks on the Ethereum network? ( Yes that also exists by the way ) The list of possibilities is truly endless. 

There is literally no limit to human creativity when it comes to tokenizing the hell out of pretty much any asset imaginable. Soon we’ll be trading stocks, bonds, commodities, real estate, precious metals, services and many other items directly on the blockchain without having to kiss the ring of some owner of an exchange that he/she can shut down whenever the trade goes against the house. Naturally when the powers that be realize that they are about to be left in the dust, expect a hefty pushback. This is why many people say it’s better to hold your ass with both hands in 2021. For the people who are not holding Ethereum in their own privately owned wallet, things will get hot! The next MtGox 2.0 is just around the corner. 

Now you see what kind of epic tech we’re dealing with, it’s definitely going to be easier to talk with your no-coiner friends and family. Just try not to sound like a lunatic because of your excitement. We’ve all been there! Oftentimes the concept of Ethereum will make more sense than Bitcoin, simply due to its functionality. Therefore have no fear and boldly proceed to make your point to one and all how this tech will change the world. 

Lego blocks for the future

Since 2018 and beyond a new beast started to emerge from the digital nethers. This one is called DEFI ( decentralised finance ). During the early years it didn’t yet catch on, simply because although being corrupt to the bone, our financial system was still functioning ( even while running on only 3 cylinders and billowing black smoke from the exhaust ). Suddenly 2020 came and the world has never been the same again. 

When the worldwide hysteria and subsequent lockdowns infected many countries, we suddenly saw the printer go BRRRRRR in order to solve artificially created problems. Trillions of endless currency units have been created in only 1 year and rest assured, now the politicians and world bankers have tasted blood, the printer will never stop. People who were smart, started to invest in REAL assets and off course cryptocurrencies became hot once more. Due to the reckless financial practices, we will all end up paying for this mess one way or another and higher taxes and tariffs are already looming on the horizon. Some say the new totalitarian regime will come bearing the flag of sustainability, ecology and all the nice, fluffy ideologies that will separate the middle class from all of their disposable income. This is why being OUT of the system is so important for the crypto currency investors. 

Enter DEFI! Without having to prove your identity or disclosing any personal information whatsoever, pretty much anyone can now participate in ALL the financial services that we have in the classic system at the moment. We can now safely add swarms of keyboard banging office plankton to the list of obsolete middlemen. No offices, no regulations no problem! You can now take out loans or loan your money to other people all on the blockchain, while being in control of your private keys every step of the way. You can have insurance contracts, derivatives trading and perhaps for the brave and somewhat foolish “Wallstreet Bets” autistic retards ( as they like to call themselves ), YES you can now have exchanges where you can trade 24/7 365 days per year without having “The Man” pull the plug on you because you are on the winning side of the trade. DEFI is a gargantuan and growing industry that’s gobbling up capital on an hourly basis. Oh yeah and most of that capital is denominated in Ethereum or crypto currencies BUILT on Ethereum. Can you finally see it now? 

Store of value 

If you think about Early internet, all the most important protocols ( building blocks like TCP IP and others ) that are crucial for a streamlined internet experience, they have actually failed to capture any value. By value we off course mean money. Where did the crisp green notes fly to you ask? They were ( and still are ) vacuumed up by the second layer of the internet: called the “Application layer”. Think of all the tech giants like Microsoft, Facebook, Google and the like. These guys have been piggybacking on the hard work and sweat of the original cyberpunks who wrote code and physically built the interconnected future of the World Wide Web. Needless to say nobody of the original creators of the internet will ever invite us to sip champagne and snort cocaine on his 150 meter long yacht any time soon. 

In Ethereum’s case, things work very differently. The core wealth ( data ) is open source and accessible to one and all. While Paypal or Facebook would never share their data with anyone, Ethereum’s code on the other hand is completely free and open to one and all. Any skilled programmer can play with it and build amazing stuff on it, creating value for millions of people worldwide. While the huge tech giants are building overweight and sluggish data silo’s, Ethereum is one ripped and lean son of a bitch that breaks these silo’s and forces the huge modern tech dinosaurs to get on the treadmill and cut huge slabs of fat from their chins. 

When an ERC20 project like Maker, Synthetix Network or Tycoon token succeed, they attract value like magnets, BUT so does Ethereum. The value is trickling down to everyone in the process. One can say that it’s as democratic as it gets. Aside from that, pretty much ALL the DAPPS and coins that live under the wing of big momma Ethereum have a common interest in seeing Ethereum do well and succeeding in the battle of crypto currencies. It’s a pretty cool feedback loop of value generation. Instead of peeking out from a tiny sand box and protecting all the toys ( like the big tech giants today ), Ethereum is simply doing its best to cal in a few hairy chested carpenters who build and expand this sandbox in order to welcome more and more new users and programmers to the party. Sounds familiar? That’s because it’s called the Metcalfe’s law, whereby a network becomes more valuable with the ever increasing number of users. Perhaps the most interesting thing about it, is that the growth is exponential. Now you finally understand it.

There are countless more snippets of valuable information that can be written about Ethereum. The growing market capitalisation, increasing use of decentralised exchanges, applications, stable coins and the lot. What’s most interesting however, is that the cryptocurrency market in general often behaves like a drunk head-banging teenager completely detached from reality. Seeing all the gigantic work that’s been done on Ethereum for the past few years, it’s clear that today’s price ( lingering at 1400 USD ) doesn’t even come close to reflecting the real value of this amazing technology. That means the people who pulled the trigger on Ethereum will have a wild, yet amazingly satisfying ride this year and beyond.