What Is Ethereum? At its core, Ethereum is a decentralized global software platform powered by blockchain technology. It is most commonly known for its native cryptocurrency, ether (ETH).
Ethereum can be used by anyone to create any secured digital technology. It has a token designed to pay for work done supporting the blockchain, but participants can also use it to pay for tangible goods and services if accepted.
Ethereum is designed to be scalable, programmable, secure, and decentralized. It is the blockchain of choice for developers and enterprises creating technology based upon it to change how many industries operate and how we go about our daily lives.
How Does Ethereum Work? Vitalik Buterin, credited with conceiving Ethereum, published a white paper to introduce it in 2014. The Ethereum platform was launched in 2015 by Buterin and Joe Lubin, founder of the blockchain software company ConsenSys.
The founders of Ethereum were among the first to consider the full potential of blockchain technology beyond just enabling the secure virtual payment method.
The Ethereum merge went off without a hitch from a tech perspective, but sentiment around ETH after the shift to a more environmentally-friendly consensus model might be dipping. Today, the price of ETH plummeted below the $1,500 mark for the first time in more than a week.
Initially, the price of ETH had remained largely flat after the overnight merge, hovering around the $1,600 mark with slight ebbs and flows. However, shortly after 10AM ET this morning, the price sharply dipped from about $1,585 to its current mark. The move is not altogether unexpected.
In a report in early August, crypto analytics firm Glassnode flagged data on derivatives exchanges that indicated that the merge was shaping out to be a "sell the news" event. The hype around the merge appeared to be generating bullish sentiment around Ethereum in July, but sophisticated derivatives traders were already hedging their bets, expecting the price of ETH to drop after the event, according to Glassnode.
The merge is Ethereum developers’ name for the long-awaited shift away from the original proof-of-work consensus model, in which thousands upon thousands of users run powerful computers to secure the network and potentially earn cryptocurrency rewards.
Under the new proof-of-stake model—in which validators stake (or hold) coins in the network to process transactions—the network is estimated to use over 99% less energy than before, according to the Ethereum Foundation.
While many Ethereum proponents were in favor of the merge, some ecosystem participants were less thrilled. For example, some have forked the previous version of the network to create the new EthereumPoW (ETHW) network, which will retain mining, while other miners have instead started mining coins like Ethereum Classic (ETC) or Ravencoin (RVN).
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