Ethereum has made a lot of headlines lately, for a number of reasons. First, there’s the giant increase in value that its associated token, ethereum, has had this year. An ethereum token traded for around $8 at the beginning of 2017. About six months later, that same token was trading for over $400, a more than 5,000% increase in value, and as of the writing of this article, it’s steadily hovering around $300. If you invested in ether early on, you’ve probably seen your fortune increase by thousands of dollars. The boom has leveled off for the moment, but Ethereum, the software that Ethereum coins are created with, shows no signs of going anywhere. With businesses, universities, and governments lining up to get involved with Ethereum, here’s what small business owners need to know about the software, and other blockchain technology, moving ahead.
Ethereum Might Help Two Types of Entrepreneurs in A Big Way
If you’re a small business owner who’s commissioned code before and felt unhappy with the results, especially with the price you paid, or a coder who’s been ripped off by your clients, Ethereum could be a boon for you. Ethereum was created in part as a way to make sure developers, like its creator Vitalik Buterin, are paid in full for their work. If you’re a developer, and you work with a company that runs on Ethereum, you can have increased confidence that you’ll be compensated adequately for the work that you do. On the flipside, since ether blocks payments for unnecessary code, it will make small business owners who use Ethereum less vulnerable to developers who inflate their rates by writing more code than required. Both sides stand to benefit by getting on board with the Ethereum platform, and if the technology continues to spread, it may soon be difficult for developers or small business owners to connect with each other without adopting the standard.
Big Business is Already on Board
One reason that Ethereum has jumped so much in price is that Ethereum has gained the support of some of the world’s largest business concerns. Unlike Bitcoin, the first cryptocurrency software to gain mainstream popularity, Ethereum is intended to do more than facilitate online peer-to-peer financial transactions. It’s a platform on which a seemingly endless number of applications can be built and executed, and this has attracted the attention of an ever-growing number of financial institutions, including MasterCard, Microsoft, and the Indian government. These are but a few of the big names that make up the Ethereum Enterprise Alliance.
Ethereum Will Improve Efficiency
Ether transactions have no third-party intermediary since they rely on a blockchain. This cuts down on the fees associated with making monetary transfers of fiat currencies and makes doing business more efficient. This is one reason so many massive banks and other financial concerns are getting behind Ethereum. The ability to use instant smart contracts saves valuable time and money for them, and it could do the same for your small business if you have a lot of transactions that need processing.
Ethereum Will Fuel Startups
Since the blockchain software is open source, anyone can build applications using Ethereum. This means that new startups are likely to adopt Ethereum as their currency of choice, and Ethereum as their means of conducting transactions. Expect to see myriad new companies using Ethereum to fuel their growth, like TenX, an app allowing people to track and spend their virtual currencies. If you’re a small business owner or considering opening a small business, you should be prepared for Ethereum at the very least, and if at all possible, you should embrace it.