Downturns are certainly a challenge, but also an opportunity, because then the most sensible projects will be set up and expanded, says Vitalik Buterin.
• Crypto-crash as an opportunity for sustainable projects
• Conversion of Ethereum blockchain to “Proof-of-Stake”
• Uses of cryptocurrencies far from media interest as the norm
Ethereum is currently the second largest cryptocurrency after Bitcoin with a market value of $ 122.43 billion. Since its all-time high of $ 4,891.70 on November 16, 2021, Ethereum has fallen about 79 percent, but has also been able to break away from its recent low of $ 896.11 and trade temporarily at 1,051 , 37 US dollars. Dollar (coinmarketcap, as of 07/04/2022).
Cracked as an option
Cryptocurrencies have experienced ups and downs before, the current situation has its challenges but is not new, according to the founder of altcoin, Vitalik Buterin. In an interview with Fortune, he and his father Dima Buterin, who created the Ethereum blockchain, were unaffected by the current situation in the crypto market.
According to Vitalik Buterin, the collapse of the Terra / LUNA network was one of the most important and healthy moments for the crypto industry, he said in the interview. Because he showed that there are disadvantages. “You can not just build a system and magically pretend that the negative event never happens,” Buterin said.
The Terra stablecoin crash had sent shock waves through the crypto sector and triggered domino effects. Vitalik Buterin is confident that the Ethereum ecosystem will continue to evolve and meet the expectations of crypto investors.
Even in the bear market – and perhaps especially there – there are most short-term opportunities for investors: above all, it attracts short-term speculation. The last “crypto winter” was followed by a crypto boom that produced several cryptomillionaires, if not cryptomillionaires.
In the longer term, Buterin sees the opportunity in the bear market in recognizing which projects have proven themselves in the long term. Similar improvements could be made both in relation to the models and the workforce.
Merge: Conversion to the “Proof-of-Stake” Procedure
By the end of this year, the Ethereum blockchain should be converted to the so-called “Proof-of-Stake” procedure, which is also known by the keyword “The Merge”. Compared to the current mining method, the “proof of work”, it is expected to reduce costs drastically – according to estimates from the Ethereum Foundation even by 99.95 percent. Ethereum can become significantly more environmentally friendly due to the massive reduction in energy consumption.
In an interview with Fortune, Vitalik Buterin sees another crucial benefit to his ecosystem in the transition: the “Proof-of-Stake” procedure can increase system security because it makes an attack more expensive. At the same time, it becomes easier for the system to recover from a hacker attack. In addition, the merger makes the process more resistant to censorship because it is much easier to track down and shut down miners than validation nodes on a computer.
Distribution and use of cryptocurrencies
Cryptocurrencies are best known by the general public for extremely expensive NFTs such as the Bored Ape Yacht Club monkey artwork or million-dollar hacks. Although these are real uses of cryptocurrencies, they are extreme examples and isolated cases. In general, the industry is more about companies and people working together internationally, transferring funds and investing assets. This happens far away from the interest of the media, but is the normal case.
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