Ethereum
Crypto Overview
Understanding Intended Utility
Ethereum was created in 2015 as a decentralized computing platform that enables smart contracts and decentralized applications (dApps). Its primary purpose is to serve as a global, open-source platform for decentralized applications and programmable value transfer. The native token ETH is used to pay for computation and transactions on the network.
Current Usage and Implementation
Ethereum currently hosts thousands of decentralized applications, including decentralized finance (DeFi) protocols, NFT marketplaces, and various utility applications. The network successfully transitioned to Proof of Stake in September 2022 through 'The Merge', significantly reducing its energy consumption.
Token Distribution and Governance
Initial distribution included a public sale where 72 million ETH were created. The Ethereum Foundation and early developers received approximately 12% of the initial supply. Current supply is not fixed but has become deflationary since EIP-1559 implementation. Network validation is now performed through staking, with over 10% of total ETH supply currently staked.
Development Activity
Ethereum maintains the largest developer community in cryptocurrency, with continuous protocol improvements and upgrades. Recent developments include the implementation of EIP-4844 (Proto-Danksharding) to reduce transaction costs, and ongoing work on full sharding implementation.
Revenue Model and Technology
The network generates revenue through transaction fees (gas fees) paid in ETH. While staking does provide returns, it represents compensation for network security rather than interest-bearing debt. The base protocol itself does not engage in lending or interest-based activities, though such applications can be built on top of it.
Crypto Impact
To assign a comfort level investing in Ethereum from a halal perspective we need to determine whether it has a net positive or negative impact.
Towards this end, the table below is used to tally all the positive and negative considerations our members can think of related to Ethereum.
If you don’t see something that should be listed, positive or negative, feel free to submit your own contribution using the button “Contribute”.
We will review your contribution for accuracy before publication.
Importantly, you can review listed contributions and vote on which one you think has the greatest impact, positive or negative.
You only have one vote per asset so use it wisely.
You can change your vote if you change your mind.