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Wednesday, 22 Sep 2021
Crypto Notes
A weekly newsletter decoding crypto, blockchain and the entire ecosystem.
By Rohas Nagpal

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All about Ether (ETH)

Over the last few weeks, we discussed Dogecoin (DOGE), Cardano (ADA), Binance Coin (BNB), Solana (SOL), and Bitcoin (BTC). This week we take on Ether (ETH).

Did you know?

Ethereum is not a blockchain. It's not a cryptocurrency either. It's actually a protocol (a set of rules or procedures).

The original Ethereum split into two blockchains - Ethereum and Ethereum Classic - after the 2016 Decentralized Autonomous Organization (DAO) hack.

Ether (ETH) is the world's second-largest crypto by market cap.

Before we dive deeper, let's check out the latest price-sensitive crypto news.

pNetwork, a cross-chain DeFi protocol, has been hacked and 277 bitcoins (approx $12 million) have been stolen.

Crypto exchange Binance is now being probed for money laundering activities by the U.S. Department of Justice.

Crypto exchange FTX has received regulatory approval from the Securities Commission of The Bahamas to operate a digital asset business.

1. What is Ether (ETH)?

Name: Ether

Symbol: ETH

Overview:

Ether (ETH) is Ethereum's native cryptocurrency and should not be confused with ETC which is the native crypto of Ethereum Classic.

ETH is the fuel for the execution of decentralized smart contracts on the Ethereum blockchain.

Gas is the fee, measured in Gwei (0.000000001 ETH), that is required to successfully conduct a transaction on Ethereum.

Wei is the smallest fraction of an Ether. One ETH equals 1,000,000,000,000,000,000 Wei.

The most popular Ethereum tokens are:

Stablecoins, which mirror the value of fiat currencies like the US dollars.

Governance tokens, which represent voting power in decentralized organizations.

Collectible tokens / non-fungible tokens (NFTs) that represent a collectible, piece of digital art, etc.

Consensus mechanism: Proof of Work

2. Metrics

As of 21 September, its core metrics are:

Price metrics

Current Price: $ 3,034
All-time high (May 12, 2021) $ 4,362.35
All-time low (Oct 21, 2015) $ 0.42

Supply metrics:

Circulating supply: 117.6 million ETH
Total supply: 117.6 million ETH
Maximum supply: Unlimited

Note:

Circulating Supply is the number of coins / tokens in public hands.

Total Supply is the number of coins / tokens created minus the number burned.

Maximum Supply is the maximum amount of this crypto that can ever exist

Figures have been rounded off for convenience

Marketcap & Volume metrics:

Market Cap: $ 357 billion
Fully Diluted Market Cap: $ 358 billion
Volume (24h): $ 29 billion
Volume / market cap ratio: 0.08
Velocity: 245

Note:

Market cap = Current Price x Circulating Supply

Fully Diluted Market Cap is the market cap if the maximum supply was in circulation

Volume (24h) is the fiat value of this crypto traded over the last 24 hours

Dominance measures a crypto's total market capitalization relative to the total market cap of all cryptos

Volume / market cap ratio = 24h Volume / Marketcap

Velocity = 24h Volume / Circulating Supply

Figures have been rounded off for convenience

RoI metrics:

Year Returns (%)
2020 +464
2019 -9
2018 -83
2017 +8,982
2016 +752
2015 -69

Risk metrics:

  Volatility Sharpe ratio
Last 30 days 0.85 -0.071
Last 90 days 0.85 2.76
Last 1 year 1.07 2.46
Last 3 years 1 1.21

Note:

Volatility measures the annualized standard deviation of daily returns

Sharpe Ratio measures the excess return for a given level of risk

3. Wallets

There are a large number of mobile, desktop, web, and hardware wallets for ETH.

Note: The data/graphs are from CoinMarketCap, Messari, and Future Money Wallet. Figures as of 21 September 2021.

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Rohas Nagpal is an author, an amateur boxer, a blockchain architect, a Tintinologist and a retired hacker.

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