Mapping the Major Ethereum Forks
Many people are familiar with blockchain technology, but did you know that Ethereum has the largest and most active blockchain community in the world?
Unlike many other blockchain networks, Ethereum is programmable. This customizable feature has enabled developers to solve problems ranging from digital identification and privacy, to corporate ownership and data security.
When the blockchain community disagrees on what changes the network needs to function smoothly or when such changes should take place, developers plan for a fork (an offshoot) of the underlying code rules.
Today’s graphic maps out the major Ethereum blockchain forks that have occurred to date, highlighting key events that surrounded each of these updates. It also includes details on the highly anticipated Istanbul hard fork, planned for December 2019.
Four Types of Forks
Forks are common practice in the software industry, and happen for one of two reasons: split opinions within the community, and required changes to the blockchain code.
When either reason is discussed, four major types of forks can occur.
- Codebase Forks: Copy of the original code, to allow for minor tweaks without developing the whole blockchain code from scratch.
- Blockchain Forks: Branching or splitting a blockchain’s whole transaction history, causing the new network to develop a distinct identity.
- Soft Forks: Gradual software upgrades—bug fixes, security checks, and new features.
- Hard Forks: A permanent division of the blockchain.
There are currently three types of hard forks:
Scheduled upgrades to the network, often abandoning the old chain
Community disagreements cause major code changes, forming a new chain
- Spin-off Coins
Minor changes to the blockchain’s code that create new coins
Let’s dive into the timeline of major Ethereum forks, and explore a few of their defining moments and characteristics.
Mapping the Major Ethereum Forks
Below are some of the most prominent and important forks—both hard and soft—on the Ethereum blockchain since its launch.
Vitalik Buterin, founder of Ethereum, and his team finished the 9th and final proof of concept known as Olympic in May 2015. The Ethereum blockchain, also known as Frontier, went live shortly after, on July 30, 2015.
Also known as “Frontier Thawing”, this was the first (unplanned) fork of the Ethereum blockchain, providing security and speed updates to the network.
Homestead is widely considered Phase 2 of Ethereum’s development evolution. This rollout included three critical updates to Ethereum: the removal of centralization on the network, enabling users to hold and transact with ETH, and to write and deploy smart contracts.
The Decentralized Autonomous Organization (DAO) event was the most contentious event in Ethereum’s short history. The DAO team raised US$150 million through a 2016 token sale—but an unknown hacker stole US$50 million in ether (ETH), prompting the developer community to hard fork in order to recover the stolen funds.
Widely regarded as the only Ethereum fork of any significance, this hard fork was based on the controversial DAO event. The original chain became known as Ethereum Classic, and the new chain moved forward as the main Ethereum chain.
This September 2019 hard fork event required all software users to upgrade their clients in order to stay with the current network. Enhancements included better security, stability, and network performance for higher volumes of traffic.
Regarded as the third phase of Ethereum’s evolution, the Metropolis-Byzantium soft fork functioned more like an operating system upgrade, rather than a full split.
Constantinople is the current version of the Ethereum blockchain. This hard fork occurred concurrently with the St. Petersburg update. Important changes included closing a major security loophole that could have allowed hackers to easily access users’ funds.
Constantinople’s most notable improvements include smart contracts being able to verify each other using only the unique string of computer code of another smart contract, and reduced gas fees─namely, the price users pay to process transactions more quickly.
Future Forks in the Road
The Ethereum community is preparing for the next hard fork event Istanbul, scheduled for release on December 4th, 2019.
Ethereum’s 4th and projected final stage of development is Serenity, which has yet to be scheduled. Community members have speculated what changes will come with Serenity, but many agree that the Ethereum blockchain will shift focus from Proof of Work to Proof of Stake.
- Proof of Work (PoW): “Miners” are rewarded with cryptocurrency for solving puzzles that process and post blocks of data to the network
- Proof of Stake (PoS): Miners are chosen from a pool of miners, based on the stake of cryptocurrency they bid; no puzzle = no reward
Proof of Stake means that there is less competition for completing blocks of data, significantly reducing the energy required to process data. Currently, a single Bitcoin transaction consumes the same electricity as 1.75 American households do in a day.
Ethereum Leads the Way
Ethereum continues to be a leading blockchain platform, with the highest number of decentralized apps (dApps) and a massive, engaged community.
To date, cryptocurrencies have largely been the focus of news headlines. However, we’ve only begun to scratch the surface of what blockchain can offer, and the value it will create beyond the financial world.
[Blockchain] could be the foundation of a whole new era whereby our basic right to privacy is protected, because identity is the foundation of freedom and it needs to be managed responsibly.
—Don Tapscott, Executive Chairman of the Blockchain Research Institute
Cryptocurrency: Redefining the Future of Finance
From Bitcoin to Tezos, cryptocurrencies are reshaping the financial industry. As they rapidly advance, how will current applications impact tomorrow?
Cryptocurrency: Redefining the Future of Finance
Cryptocurrency is a thriving ecosystem, quietly encroaching on conventional finance’s territory.
Over the last five years, Bitcoin users and transactions have averaged a growth rate of nearly 60% per year. Similarly, private and public investors have deepened their commitment to cryptocurrencies including Ethereum, Ripple (XRP), and Stellar—and a number of others across the industry.
Today’s infographic unpacks a cross-section of cryptocurrencies, stakeholders, and core applications across a sector that’s continuing to grow in importance.
The Evolution of Cryptocurrency
Cryptocurrency has erupted into a $200 billion industry, sparking a wave of global disruption.
At the heart of cryptocurrency is a rich history of innovation. It extends back to the 1980s with advances in the field of cryptography—eventually leading to the technology that forms encryption techniques designed to protect the network.
Since then, a series of key events have continued to shape the sector.
|2009||Satoshi Nakamoto mines the first Bitcoin on a decentralized network|
|2012||Ripple is founded
|2013||The price of a single Bitcoin reaches $1,000
|2015||Ethereum launches, introducing smart contracts into the crypto ecosystem|
|2017||Over 1,000 cryptocurrencies listed
|2017||Bitcoin's price rockets past $10,000, reaching a peak just shy of $20,000|
|2018||EOS offers a blockchain-based infrastructure for decentralized apps (DApps)|
Now, there are over 5,000 cryptocurrencies in circulation, with many built on innovative applications and use-cases as the ecosystem rapidly evolves.
The Value of Cryptocurrencies
Today, crypto offers cutting-edge advances that are diverse and transformative. In addition, it could also be considered an investment in tomorrow’s financial system—decentralized finance (DeFi).
DeFi is an emerging alternative financial system that is built on a public blockchain, which enables greater accessibility because anyone has the ability to connect to it. Additionally, transactions are publicly visible, enabling greater transparency across the system.
Here is a refresher on some of the practical advantages being applied across cryptocurrencies.
|Used for purchasing goods without the need of a trusted third-party|
|As the total supply of many cryptocurrencies are limited, this scarcity influences their value
|Digital money that is typically pegged to a currency or commodity, such as gold
|Cryptography, the technology behind crypto, can enable the anonymity of its owners
|Can empower those without access to a bank to enter the financial system
|Digital Gold||Bitcoin||Bitcoin shares similar attributes to money: a medium of exchange, unit of account, and store of value
|Decentralized Apps (DApps)||EOS|
|Enable individuals to create apps without a central authority, directly connecting the user and creator
The Key Players in the Crypto Landscape
The cryptocurrency ecosystem is growing rapidly. Worldwide, private and public actors recognize its potential across many domains.
Who are the primary participants in the field today?
- Institutional Investors
Harvard Endowment Fund, Crypto Hedge Funds
- Cryptocurrency Exchanges
- Banks & Finance
J.P. Morgan, Fidelity Investments, Swissquote
- Power & Utilities
- Central Banks
China, Sweden, Saudi Arabia
Crypto Valley Association, Global Digital Finance
The rising popularity of crypto is bolstering new policies and adoption, as evidenced by the many players trying to break into the space.
The Big Picture:
As crypto continues to gain momentum, its longer-term implications will come into focus. Crucially, its cryptographic foundation sets the stage for future advances in finance.
Anonymized transactions protect users data through cryptographic techniques
Providing a new financial model for 1.7B unbanked individuals around the world
Steep reductions in settlement time and efficacy could save consumers $16 billion annually
Providing immutable, traceable records of security-rich transactional networks
- Programmable Money
Smart contracts could drastically eliminate manual and administrative work— ultimately bypassing them altogether
Rooted in decentralized and autonomous systems, cryptocurrencies are creating second-order effects in the financial world. Ultimately, cryptocurrencies are helping to transform finance as we know it—unlocking countless investment opportunities across the global economy.
Visualizing the New Cryptocurrency Ecosystem
Cryptocurrencies have evolved past digital cash. This graphic explores the the new cryptocurrency ecosystem and how it’s impacting the modern economy.
Visualizing the New Cryptocurrency Economy
Over a decade ago, the birth of Bitcoin sparked a revolution in the digital world — and just last year, the number of active cryptocurrencies jumped from roughly 1,600 to over 3,000 worldwide.
Cryptocurrencies have now evolved past simple digital currencies, offering solutions to meet the complex needs of modern financial markets.
Today’s graphic from Abra visualizes the complex, ever-evolving cryptocurrency ecosystem and its real-world applications.
Characteristics of Cryptocurrencies
Why are cryptocurrencies important for the future of digital finance?
Drastically reduces fees and processing times due to a lack of cross-border restrictions
Prevents governments or major institutions from blocking financial activities at whim
- Greater financial control
Individuals can have total control of their funds
- Greater security
Prevents fraudulent alterations from third parties
- Lower costs
Lower transaction fees thanks to fewer third parties
- Greater Accessibility
Reduces or eliminates traditional barriers to capital markets
Much like the internet has forever altered how we live and work, cryptocurrencies have the potential to change how people participate in global financial markets.
Categorizing the New Crypto Economy
Today’s cryptocurrencies go beyond replacing cash. This new token-based economy is evolving─with unique solutions emerging in finance, security, identification, social engagement, and ownership.
Cryptocurrencies are generally categorized by their primary application within the ecosystem:
Digital cash can be used for both ecommerce and brick-and-mortar retailers
- Store of value
New form of scarce native currency and a means of settlement
- Programmable money
Borderless money that enables easy conversion between currencies
Crypto version of fiat which is tied to the value of resources like gold or the U.S. dollar
Private digital transactions, with some offering anonymity
- Digital ownership
Digital handling, storage, and monetization of data
- Decentralized utilities
Crypto-enabled networks, products, and services that exchange between assets
- Alternative finance
Digital assets such as collectibles, commodities, and tokenized securities
Cryptocurrencies are adding both value and utility to the digital economy, and to the global financial market as a whole.
Applications of Cryptocurrencies
Because cryptocurrencies are programmable, customizable computer code, developers can design and adapt them for many use cases within the digital economy.
How are these various cryptocurrencies being used in everyday applications?
- SPEDN auto-converts crypto to fiat for merchants, reducing exchange rate risk while offering convenient customer payment options.
- Slice offers real estate investing to anyone for as low as $10,000 through fractional investment.
- CyClean plans to launch a blockchain-enabled electric vehicle (EV) fleet that mines crypto as users travel—reducing emissions and rewarding users for doing so.
- Digital construction platform Builderium connects contractors to clients around the world through blockchain, opening up a global marketplace of potential deals.
These are just a few of the ways cryptocurrencies are breaking down barriers for people and companies worldwide—allowing them to grow personal wealth and enter the global market.
The Growth of the Crypto Economy
Worldwide, the numbers show that blockchain-based technology and cryptocurrency use is growing. Blockchain wallet users rose from nearly 9 million in 2016 to over 42 million in 2019.
Developers produced a mere 100 decentralized apps (DApps) in 2015─with that number skyrocketing to over 3,100 by 2019.
Overall, cryptocurrencies are helping to create an innovative and accessible financial system around the world.
Cryptocurrency deserves an opportunity to find a sustainable future in our economy.
—Adena Friedman, President & CEO of NASDAQ
While the future of the new cryptocurrency economy is still taking shape, one thing is certain─cryptos are forever altering the way we view and measure the value of money.
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