Is Ethereum Becoming the New Platform for Startups?
The recent rise in value of Ethereum has vaulted it to over a billion dollar capitalization and second only to Bitcoin. Its value is more than four times the value of the third place crypto-currency, XRP.
Ethereum was created by Vitalik Buterin, a college dropout who, although enthused by the potential for Bitcoin, felt that there could be a better platform. Buterin, who has been compared to Steve Jobs, feels that his creation provides a robust platform for others to develop on and create powerful applications.
Buterin recently released his first production-ready version of Ethereum but even prior to this release, there had been a rush of startups to utilize the open platform and create blockchain based businesses for new products and services, or to supporting their existing businesses.
Anthony Di Iorio, one of Ethereum's founders and a Chief Digital Officer at the Toronto Stock Exchange, said in an interview:
We’ve seen Microsoft and IBM doing projects on Ethereum. There’s a lot of coders. It’s exciting to see something you were in on in the early stages growing and bearing fruit.
In 2015, there was a rush of venture capital into Bitcoin and Blockchain companies. This year, influence, and potential of Ethereum is seeing venture money coming in specifically targeted to Ethereum based startups.
Two leading venture capital firms, Boost VC, along with Blockchain Capital, are both taking a closer look at Ethereum companies. Boost VC is clearly indicating their interest in Ethereum businesses by stressing the cohesiveness of the developers and the strong leadership exhibited by Buterin. Brock Pierce, founder of Blockchain Capital indicates that his firm is looking beyond Bitcoin for startups this year, saying:
... you’re going to see the use of other blockchains beyond Bitcoin, such as these permissioned ledgers that a lot of financial institutions are interested in, but also even other public blockchains like Ethereum.
One startup that has many people excited is Augur, which is building a predictive modeling system that is built on Ethereum.
Venture money is also moving towards Ethereum mining pools such as BTCS. Charles Allen, CEO of bitcoin mining outfit BTCS, noted that his firm recently built custom Ethereum mining rigs as part of a pilot program due to the escalating price of ether.
The billion dollar capitalization of Ethereum has clearly raised its profile and potential of its currency, Ether as a powerful form of currency and investment.
We're sure to see other startups and businesses who will recognize this reality and provide investing capabilities to harness the potential of Ether as a currency.
The growth and interest in Ethereum is making it clear that the discussion about cryptocurrencies can no longer be limited to Bitcoin. As more startups and money continue to chase the potential of Ethereum it’s imperative that anyone following the digital currency space needs to keep up to date to what’s going on with Ethereum.