Ethereum (ETH) is nailing its colours to the mast as a serious challenger to Bitcoin’s throne as the decade-old original cryptocurrency struggles to find enough momentum to climb out of its current slump.
Often touted as the main rival to Bitcoin, Ethereum has never quite done enough to match the volume or market cap of the world’s most popular cryptocurrency, but a strong start to the new year has created excitement among investors, according to an article in the Daily Express.
The article says Ethereum was given a fanfare welcome when it was released in mid-2015 and immediately greeted as the currency to knock Bitcoin off its perch, but the brainchild of Vitalik Buterin, Gavin Wood, and Joseph Lubin never quite lived up to the hype.
However, with Bitcoin still straining to climb from a slump which began in November 2018, new enthusiasm for Ethereum is beginning to grow. In the first few days of 2019, ETH has emerged as the best-performing crypto, with gains of more than 10%.
Ethereum’s market cap also currently outshines that of its closest rival – Ripple (XRP) – by more than half a million dollars.
This sudden growth, however, may yet be tempered by a series of forks planned for Ethereum during January.
A hard fork occurs when a cryptocurrency is required to split and create new branches in order to allow an improved version of the coding behind that crypto to emerge.
The most recent example of a hard fork occurred a couple of months ago when Bitcoin Cash split into BCH SV and BCH ABC.
A bitter war of words ensued between the two factions and cost millions in the chaos that followed, as both parties engaged in a lengthy hashing war.
Although looking at some relatively amicable splits, Ethereum is now facing the prospect of several forks – three of which will be significant, particularly for anyone involved in decentralised applications (dApps) on Ethereum’s blockchain.
The opening fork is scheduled for January 11th with the Ethereum Classic Vision breakaway, which should see Ethereum holders receive three ETCV for every one Ethereum in their wallets.
The following day will, it is anticipated, see the Ethereum Nowa fork, from which owners of ETH should receive one ETN per Ethereum.
All eyes, however, are on January 16th for what is set to be the much-anticipated Constantinople mainnet hard fork. This, in particular, will be significant in the cryptocurrency world as it signals Ethereum’s drive towards using Buterin’s favoured ‘proof of stake’ protocol instead of ‘proof of work’.
It also means the prize for mining blocks will go from three ETH to two, but this should make the network faster – something many will regard as a massive benefit from the fork.
What happens after the forks is up for debate, but historical evidence says it should provide a short-term boost. The long-term outcome is going to be down to the level of post-fork investment.