The open-source blockchain Ethereum has been clouded by several myths since its proposition by Vitalik Buterin in late 2013. Decentralized operations lie at the very core of this cryptocurrency and this has completely altered the way of doing business by offering new concepts of financial security and transparency.
A research conducted in February 2018 established the Ethereum network as more decentralized compared to Bitcoin. The main reason behind this is the broad distribution of Ethereum networks across the globe in comparison to peer nodes. Despite the many myths surrounding Ethereum, today we are going to attempt to clear your notions about this premier crypto.
What Is Ethereum
Ethereum is the second-largest crypto in terms of market capitalization which ranks just after Bitcoin. The development of this decentralized open-source blockchain was founded through an online crowdsale which was held between the months of July and August 2014. The system marked its foray by minting 75 million coins and going live on 30th July 2015. An international public node network is used by the Ethereum Virtual Machine (EVM) for executing scripts. In stark contrast to Bitcoin, the instruction set of this virtual machine is Turing-complete.
This decentralized platform allows exercising control over money, and also the option of building applications that can be accessed from every corner of the world. Ethereum developers can pay with Ether for the services availed by them on the Ethereum blockchain. In 2016, Ethereum split into two different blockchains following the exploitation of a major loophole in the smart contract software of The DAO project and theft of Ether worth $50 million. Post-separation, the original version continued as Ethereum Classic (ETC), and the new version came to be known as Ethereum (ETH). Now that you have gained a clear understanding of Ethereum, let us bust some Ethereum myths.
Myths Surrounding Ethereum
- Ethereum Is Totally Free From Errors
One of the most common myths about Ethereum is that it is completely devoid of all failures and errors. But in reality, cryptocurrencies are not infallible and Ethereum is no different. Every crypto is created with the aim of filling in the loopholes present in peer cryptos. This is why Ethereum also tried shielding itself from critics by camouflaging its inherent problems from the very onset. Despite this, Ethereum has a strong foundation in self-executing contracts which levies the responsibility of protecting the transactions on every single user. Herein lies the reason behind the paramount confidence of users on Ethereum, and why they never want this digital currency to fail.
- It Is Impossible For Pools To Collude
The transactions which show interest in processing the generated blocks are the only ones that can be included by the pool operators. Most pools operate with the objective of providing a distributed generation of blocks. Currently, only four or five popular tools hold about 60-70% of the entire network’s hash rate. This can be implemented on any crypto whose level of complexity overcomes certain set limits. All these attributes make mining alone cumbersome.
- Ethereum Can Keep Investors Buffered From Attacks
Resistance to collusion, resistance to attack, and fault tolerance are three major elements that come together to build up a crypto’s strength against adverse external stimulants. The system can transform into a decentralized entity even if one of these factors fails to show its worth. Participants cannot conspire with malicious intentions to benefit at the expense of others if the crypto system is adequately strong. If big corporations and governments start conniving plans for their own benefit, then the customers at large will be severely impacted.
- Ethereum’s Network Configuration Cannot Be Manipulated
CryptoKitties, a blockchain game accounted for 13% of the Ethereum traffic in 2017, and this is why the game was touted as Ethereum’s Killer App. This game allowed users to purchase, breed, collect and sell virtual cats by converting 1 ETH to INR and other traditional fiats. These potentially harmless applications shouldn’t be underestimated at any cost as they carry a significant threat of collapsing the entire network.
Developers exercise control over the game and the smart contracts. The price equivalent of expenses tends to increase gradually in these applications which creates a possibility for the contracts to be suspended without any prior intimation. This acts as a security measure for the developers to protect them from piracy which might exist in the team’s owned accounts.
The key owner of the main account holds the right of freezing the entire game and its corresponding accounts whenever they deem fit. Thus, the myth that manipulation of the Ethereum network is impossible, in fact, is a real possibility for developers trying to modify smart contracts.
- Wallet Owners Can Access The Funds Privately
A unique characteristic of cryptocurrencies is that the users cannot transact with funds or participate in such transactions where they do not possess ownership of the funds. Token systems have schemes in place to guarantee the same. Here each agent needs to hold the correct private key, and also steer clear from double transactions and chances of theft. They are bestowed with the authority of allowing the transaction to take place and also need to comply with the requirements of the preceding agent.
You can convert 1 Ethereum to INR from any of the top crypto exchanges in India and credit your account with funds worth 34,327 Indian Rupee (ETH to INR conversion rate at the time of writing this article). A major upgrade to the Ethereum network is expected in days to come. The Ethereum 2.0 upgrade has been planned to be launched in three phases. This has been termed as Eth2 or Ethereum 2.0, and will be implemented with the main aim of increasing the network’s transaction throughput from 15 transactions per second currently to ten thousand transactions every second. The increase in throughput can be obtained by dividing the workload amongst different parallelly running blockchains sharing a common consensus. This is expected to bring down chances of theft, as the attacker will have to meddle with the common consensus while trying to maliciously tamper with every single chain.
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