[CS198.1x Week 2] Ethereum Timeline

After Bitcoin, the next most influential blockchain
platform is Ethereum. Bitcoin is a storage of value, that is to
say, it’s “coin-centric”. It was created as a medium of payment transaction
and a store of value, an alternative to regular money. Ethereum, on the other hand, was developed
as a platform to execute peer-to-peer “smart contracts” and applications. It supports Turing-complete languages, meaning
that it can perform general computation. In other words, any type of code that I run
on a regular computer can also be run on Ethereum. Code execution on Ethereum is fueled by Ethereum’s
internal token, called ether. [Ethereum Timeline 2] Ethereum was first described in a whitepaper
released in late 2013 by then 19-year-old Vitalik Buterin, a programmer from the University
of Waterloo. The platform had a token sale between July
and August 2014 and sold 7.4 million ether for 3700 BTC in the first 12 hours of the
presale. At the time, this was equivalent to 2.3 million
USD, or in Bugatti terms, about 1.2 Veyrons. The Ethereum blockchain officially went live
on July 30th 2015, and by May 2016, the cumulative value of Ethereum tokens was more than $1
billion. [Ethereum Timeline: DAOs] Around that time, the idea of Decentralized
Autonomous Organizations (DAOs for short) became hugely popular. DAOs are essentially programs on the Ethereum
blockchain that create a distributed government. “TheDAO” was a specific project that would
serve as a decentralized Venture Capital, allowing their investors to vote and decide
on the distribution of funds between startups. However, in July 2016, these dreams came crashing
down when a hacker exploited a bug in the underlying code, stealing about $120 million
worth of Ether to from TheDAO smart contract. Outraged by the enormous theft, several voices
in the community proposed to defy the protocol and undo the hack. The majority of community decided to simultaneously
rewind their own chain and ignore all activity starting from the hack, but a small subset
chose not to undo that activity with the belief that “code is law.” The split that rewinded history is the split
that is currently branded as Ethereum. The remainder that believed that nothing – including
catastrophic events like the DAO Hack – should be reverted stayed on the main chain, now
known as Ethereum Classic.

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