Today, July 30, 2021, is Ethereum’s sixth anniversary.
In fact, the block number 0 from the blockchain Ethereum was extracted on July 30, 2015, exactly six years ago.
At the time, this was in the wake of the first major bitcoin bull run, which ended in December 2013, and most notably the closure of Mt.Gox due to bankruptcy.
Bitcoin price dropped to $180 in January 2015, after surpassing $1,100 between November and December 2013.
2015 was probably the worst year so far for the entire cryptocurrency industry.
At the time, very few other cryptocurrencies existed. In addition to Bitcoin, which was born in 2009, there were Litecoin (born in 2011), Ripple (2012), Dogecoin (2013), Stellar (2014) and a handful of other cryptocurrencies.
At the time, cryptocurrencies were mostly just means of payment, that is, currencies used to carry out financial transactions.
Ethereum and smart contracts
So Ethereum introduced an innovation: smart contracts.
Smart contracts had been talked about for a long time before, but it was only in the 2013 white paper from Ethereum that its crypto version has been formalized.
In fact, Ethereum was born precisely as something new and innovative in the restricted crypto scenario of the time, that is, fundamentally as a platform to manage smart contracts, rather than a means of payment.
The same white paper published by Vitalik Buterin in 2013 begins with a paragraph entitled “A Smart Next Generation Contract and a Decentralized Application Platform”.
In this article, Buterin calls Bitcoin the “Transition System”, as well as all alternative crypto designs existing at the time. Whereas their vision was of a very different project, that is, not an alternative decentralized digital currency, but a decentralized digital platform for managing smart contracts.
In the Ethereum white paper, Buterin cited Namecoin, Colored Coins and Metacoins as examples and then defined Ethereum as follows:
“Ethereum’s intent is to create an alternative protocol for building decentralized applications, providing a different set of trade-offs that we believe are very useful for a large class of decentralized applications, with particular emphasis on situations where rapid development time, security for small and rarely used apps and the ability of different apps to interact very efficiently is important. Ethereum does this by building what is essentially the final abstract fundamental layer: a blockchain with an integrated Turing-complete programming language, allowing anyone to write smart contracts and decentralized applications where they can create their own arbitrary rules for ownership, transaction formats and state transition functions”.
Two years after the white paper was published, the first block of the new Ethereum blockchain was extracted.
Shortly thereafter, ETH tokens started to be traded on the market, at a price around US$2.8, which dropped to less than US$0.5 in the following months. Today the ETH is worth over $2,200.