Many may think of cryptocurrencies, digital wallets, trading platforms, price charts, and other developments when first hearing about Ethereum. The asset has made a name for itself due to its potential to store value and the abrupt surges and declines in the price of Ethereum. The latter aspect is what helps users earn passive income by trading, staking, or keeping it long-term until the market turns bullish. However, the average individual may not be aware of its full range of capabilities and use cases because discussions and news headlines mainly focus on price fluctuations of the cryptocurrency, regulatory changes, or growth performance comparisons.
Decentralized applications (dApps) are becoming increasingly popular among financial institutions, businesses, and anyone looking to avoid the involvement of any middlemen in transactions. All the evolution in decentralized finance is attributed to Ethereum, which inspired other decentralized blockchain developments such as Solana and Cardano. However, when it comes to dApps, Ethereum remains the unrivaled choice for the majority of developers.
Ethereum is the clear winner in the competition for blockchain solutions, being supposed to have double the number of users compared to its contender, Solana. But what secures its position as a leader besides being the pioneer in this realm, and is it easy to learn to use?
Shining a light on the intricacies of the Ethereum blockchain is the starting point for understanding what fuels its popularity among developers.
Ethereum succeeded where Bitcoin failed
Thanks to Ethereum’s multiple use cases, like decentralized apps built with smart contracts or decentralized autonomous organizations (DAOs), it can be easily confused with the oldest blockchain development worldwide. The truth, however, is far from this misassumption. Vitalik Buterin, credited with building Ethereum, published the project’s white paper in 2013 after observing plenty of potential behind the Bitcoin blockchain that had yet to be realized. The concept of decentralized applications wasn’t new then, but platforms couldn’t connect to transfer and exchange information. Thus, Vitalik Buterin conceived a space where multiple applications could run under a single set of rules.
Ethereum works like Bitcoin, relying on “nodes”, or computers that store every transaction made on Ethereum through special software instead of centralized servers. This is where its decentralized feature stems from and enables participants to create applications in a virtually unhackable space.
The Ethereum Virtual Machine (EVM), the backbone of Ethereum that conducts scripts to enable specific operations in the distributed ledger, sets Ethereum apart from less complex blockchains such as Bitcoin, Solana, and others. This computational engine is vital to assessing and conducting smart contracts during transactions.
Ethereum’s use cases have been continuously examined and worked upon, and millions of smart contracts have been deployed on the platform, with the number of users only rising. This blockchain project is backed by a strong community that has solved the numerous problems that have emerged over the years, which adds to the network’s reliability and boosts developers’ trust in it.
Ethereum scores highly in terms of decentralized security
Ethereum has undergone numerous upgrades and system deployments in order to proudly affirm that it is the safest option out there in terms of decentralized security. Users need to verify transactions digitally, and all of the devices on this network can store data without any hierarchy in authority. Consensus algorithms, cryptographic hash functions, digital signatures, and other features make it virtually impossible to crack its code and hack the network. Ethereum provides these capabilities to make the ecosystem safer to navigate, as well as easier to break into for those without extensive knowledge of how it functions.
In the worst-case scenario, if someone tried to perturb the network, they’d need a lot of computational power. Such an undertaking would require enormous processing capacity and time, and the results wouldn’t justify the costs.
Ethereum offers numerous opportunities
Ethereum has always been more than a store of value or method through which users can transact. Its most prominent use cases are creating smart contracts, decentralized apps, and enabling asset tokenization. Smart contracts have revolutionized the business world by allowing participants to close contracts without having third parties by their side. Working with banks, governmental agencies, and other financial institutions is commonplace in the traditional financial system. It makes room for many inefficiencies, further allowing for fraud, corruption, human errors, and the list goes on.
With smart contracts, agreements are closed without working with intermediaries and can facilitate numerous transactions, whether it’s properties, money, or digital assets. On the other hand, decentralized applications that use smart contracts are intended for peer-to-peer financial transactions, such as trading, borrowing, or lending.
There are numerous options to learn Solidity
Anyone who knows Solidity or Vyper, the programming languages of Ethereum, can start developing smart contracts. Additional knowledge of other programming languages can facilitate the venture. But learning to build them is not impossible for those unversed in smart contracts. There are numerous online courses that interested parties can join to learn the intricacies of the program, designed to suit any budget and learning style. Of course, it can seem like a complex undertaking for the newbie with no previous experience, given the tech skills and determination needed, the complexity involved and all the difficulties that arise along the way. Luckily, there are also communities and other experienced developers willing to help that can be found on forums like Reddit or other chat groups.
Ethereum is continuously enhancing
There have been numerous updates and upgrades to the system, the most prominent being the Merge last year. It switched Ethereum from a proof-of-work consensus model to a proof-of-stake system, which improved the network’s scalability, security, and cost-efficiency.
Regardless of how mature and efficient the platform is, there’s always room for improvement, which the community behind Ethereum continuously strives for. Ethereum promises to continue to adapt to more demands, such as higher transaction speed, lower fee costs, and more computing throughput.
Numerous blockchain platforms exist, but Ethereum remains the most mature, efficient, and secure one to date. Since many networks have dealt with security issues, the fact that Ethereum is impenetrable provides plenty of comfort.
Ways Financial Tech Is Changing The Loaning Industry
Fintech, or financial technology, is rapidly transforming the loaning industry. Fintech companies are making loans more accessible, affordable, and efficient for both borrowers and lenders by leveraging innovative technologies such as artificial intelligence (AI), machine learning (ML), and big data. In this blog post, we will explore some of the key ways in which fintech is changing the loaning industry.
Streamlined application and approval process
One of the most significant ways in which fintech is changing the loaning industry is by streamlining the application and approval process. In the past, borrowers often had to endure lengthy and cumbersome application processes that could take weeks or even months to complete.
Fintech companies have revolutionized this process by making it possible for borrowers to apply for loans online in a matter of minutes. They also use AI and ML to automate the approval process, which means that borrowers can often receive a decision on their loan application within hours.
Improved credit scoring
Another key way in which fintech is changing the loaning industry is by improving credit scoring. Traditional credit scoring models rely on factors such as credit history and income to assess a borrower’s creditworthiness. However, these models often exclude people with limited or no credit history, as well as those who are self-employed or have irregular income.
Fintech companies are developing new credit scoring models that take into account a wider range of data points, such as cash flow, spending habits, and social media activity. This allows them to assess the creditworthiness of borrowers who may not be eligible for loans from reliable money lenders.
Personalized loan products
Fintech companies are also using technology to create more personalized loan products. In the past, borrowers were often limited to a few standard loan products, such as personal loans, mortgages, and auto loans. However, fintech companies are now offering a wide range of specialized loan products to meet the specific needs of different borrowers.
For example, some fintech companies offer loans to students, small businesses, and people with bad credit. Others offer loans for specific purposes, such as home renovations, medical expenses, and weddings.
Peer-to-peer (P2P) lending is another innovative fintech model that is changing the loaning industry. P2P lending platforms allow individual investors to lend money to borrowers directly. This eliminates the need for traditional financial intermediaries, such as banks.
P2P lending can offer borrowers lower interest rates and more flexible terms than traditional lenders. It can also be a good option for borrowers with bad credit or limited credit history.
Fintech companies are also known for their speedy disbursement of loans. Once a loan is approved, borrowers can often receive the funds within hours or even days. This is a significant advantage over traditional lenders, which can take weeks or even months to disburse loans.
The changes that fintech is bringing to the loaning industry offer many benefits to borrowers. For example, fintech makes it easier for borrowers to access loans, even if they have bad credit or limited credit history. Fintech also offers borrowers more personalized loan products and lower interest rates.
Fintech is also transforming the loaning industry for lenders. Fintech companies are helping lenders to automate their processes, reduce costs, and reach a wider range of borrowers. Fintech is also helping lenders make better lending decisions by using AI and ML to analyze data more effectively.
Fintech is rapidly changing the loaning industry, making loans more accessible, affordable, and efficient for both borrowers and lenders. As fintech continues to evolve, we can expect to see even more innovative and disruptive changes in the loaning industry in the years to come.
Kenneth is a proud native of sydney, born and raised there. However, he pursued his education abroad and studied in Australia. Kenneth has worked as a journalist for almost a decade, making valuable contributions to prominent publications such as Yahoo News and The Verge. Currently, he serves as a journalist for The Hear Up, where he focuses on covering climate and science news. You can reach Kenneth at [email protected].