You probably know about Ethereum – it’s the second-biggest cryptocurrency and its network is actively used by hundreds of thousands, if not millions of users. If you have a diversified cryptocurrency portfolio, you probably hold a few Ethereum-based tokens, as Ethereum is by far the most popular platform for projects that want to issue their own tokens.
Despite some of the platform’s scalability issues, which can result in costly transaction fees, new projects are constantly growing on Ethereum. In fact, a very large percentage of altcoin projects owe their existence to the Ethereum blockchain.
From a measly $0.4 price during the ICO, Ethereum grew to become one of the biggest cryptocurrencies as well as the most used blockchain network. The road hasn’t been easy, but the Ethereum project has managed to successfully navigate many challenges.
On August 30, 2014, Ethereum announced the end of its public token sale. The team raised $16 million to foster the development of what would become the most prominent blockchain project. After selling at an average price of under 0.5 USD during the ICO, ETH grew into one of the most valuable crypto assets. Since its initial offering, it has produced returns of over 3,000x times and reached an all-time high of over $2,000.
A $1 investment in ETH at ICO price would worth over $4,000 at press time. Only one other cryptocurrency project can proudly boast of such a plentiful return – Bitcoin. Ethereum’s ROI influenced the popular belief in the potential of cryptocurrency ICOs – no investor wants to miss out on ‘the next Ethereum’. Ethereum’s massive gains following its initial coin offering paved the way for an era of new projects making their way into the crypto space via fundraising programs.
But this is not the only way Ethereum has pioneered the ICO boom and the proliferation of blockchain projects.
The Ethereum blockchain features smart contract functionality that allows developers to create new cryptographic tokens on the Ethereum blockchain. These cryptographic tokens run parallel to the network’s native asset, ETH. In addition to ETH, other tokens can run on the same Ethereum blockchain. This feature set off a spontaneous effect and has set the crypto space ablaze since it was first announced and used.
For cryptocurrency developers, creating a new blockchain is only a choice, not a necessity. But whether a new project wishes to develop its own blockchain or not, Ethereum’s smart contract platform simplifies the process of raising funds to develop a blockchain project. New projects can easily issue Ethereum-based tokens and use them to raise funding. To raise funds for the projects’ development, founders would simply offer these tokens to investors. If good tokenomics are applied, these tokens would grow in value as the project gains traction.
Ethereum has been the platform of choice many notable projects before they launched their mainnet, and the ICO boom was almost entirely facilitated by the Ethereum blockchain. A good amount of autonomous altcoin projects only surfaced and survived because they utilized the Ethereum blockchain. Ethereum is far from done in its duty of bringing new projects to life and housing existing ones while spreading the real benefits of blockchain technology.
Many other blockchains have also developed smart contract platforms which allow users mint new and circulate new tokens on the blockchain. The Tron network, for example, has emerged as a competitor to the Ethereum network on all round. With a cheaper and faster blockchain, Tron aims to solve some of the biggest issues of the Ethereum blockchain. Despite this, Ethereum retains its pioneering prestige and continues to be the number one choice for elite projects.
It is pertinent to say that Ethereum paved the way for a new generation of cryptocurrency and blockchain projects whose real focus is creating utility and attempting to offer solutions to real world issues. No doubt, Ethereum has also been the platform for some “shitcoins”, but the number of reputable projects growing from this unique blockchain is quite astounding.