Ethereum, developed by a 21-year-old who dropped out from the university, has already attracted the attention of companies like IBM, Microsoft, and J.P. Morgan.
While the Bitcoin still suffers from its ups and downs, a new virtual currency has emerged that threatens its status. The price of Ethereum has soared by 3,750% since the beginning of 2017, drawing considerable attention from financial and technology giants such as J.P. Morgan Chase, Microsoft, and IBM, who described it as the next Bitcoin.
The rise of the new virtual currency has contributed to struggles within the Bitcoin community over how to develop the basic Bitcoin program. These struggles slowed the dealings in Bitcoin and led some investors to seek alternative virtual currencies.
Like Bitcoin, Ethereum – developed by Vitalik Butreen, a 21-year-old Russian-Canadian young man who dropped out from his studies at Waterloo University in Ontario – is based on the Blockchain system, where each transaction is recorded. The system allows the exchange of funds and assets faster and cheaper than relying on a long chain of intermediaries. But the Ethereum promises to do much more than Bitcoin, Besides the virtual currency, the software provides a way to create online markets and programmable deals, so-called “smart contracts.”
IBM said last year that it would experimentally use the Ethereum as a way to control objects in the real world in what is called the “Internet of Things.” Microsoft is working on several projects that will facilitate the use of sites in the service JPMorgan created a special tool, Masala, which allows some of its internal databases to communicate with Blockchains of Ethereum.
Since the beginning of the year, the value of one Ethereum unit has jumped from $8 to $300. This has brought the value of all existing Ethereum currencies to over $28 billion, far more than any other virtual currency except Bitcoin. The total value of all the Bitcoin coins last week was $72 billion.