Unlike most cryptocurrency ratings published online, the Wise Crypto ratings have nothing to do with the current or future price of the currency. Whether or not a crypto is over or undervalued or priced today is completely irrelevant. Our research focuses on the sustainability of each project, the security, the use case, decentralisation, environmental impact, the technology, the scalability and the developers and teams behind the projects.
Ethereum (ETH) Rating = 391/1,000
Technology (0 to 300) = 51
- Speed (0 to 50) = 5
The block time in Ethereum at about 10-19 seconds per transaction. The speed is a bit quicker because its block sizes are much smaller than the likes of Bitcoin – currently around 20-30kb.
However, the time for an Ethereum transaction to be completed depends on how much you pay in transaction fees and how congested the Ethereum blockchain is.
The speed is expected to be faster. Ethereum’s Plasma is a project in development that will allow for transactions to be processed off the blockchain. Sharding is another solution expected to group nodes into sections to split the workload of processing to increase transaction speeds.
But then, it is still a long way before these developments materialize. Right now, the Network is still plagued by congestion which makes it slow – taking over 20 minutes when clogged with heavy users.
- Cost (0 to 50) = 1
Ethereum transaction cost is dependent on the transaction you are doing. For instance, a simple transfer of ETH from one address to the other would cost 2100 Wei pf gas while a contract can cost 150000 Wei or more. The actual transaction fee is usually calculated via formula:
Gas amount x Gas price
The gas price varies and hugely depends on the number of transactions pending on the Network. In essence. The total cost of a transaction will be the product of gas costs and gas prices, while the maximum transaction fee will be the product of gas limit and gas price. The difference is refunded to the transaction’s sender to keep the system fair and usable.
Nonetheless, Ethereum transaction cost is still much higher compared to other blockchains, and therefore the foundation should at least lower the cost of a transaction.
- Scalability (0 to 50) = 10
Ethereum is struggling with scalability issues as the blockchain is almost full. Scaling Ethereum is also quite difficult. The Network depends on “nodes” which store the entire Ethereum transaction history including the current state of account balances, contracts, and storage. Ethereum developers are, however looking at ways to eliminate the scalability issue mainly through Sharding and implementing off-chain transactions.
Many scaling solutions have been planned and announced but each time we have seen them fail and postponed.
- Reliability (0 to 50) = 25
ETH is indeed reliable as it has proven to be a robust, trustworthy, and revolutionary platform that enables developers to design and issue their own cryptocurrency. ETH is quite decentralized as it uses smart contracts and the Ethereum Virtual Machine, which monitors the smart contracts by killing off any untrusted code.
- Environmental Impact (0 to 50) = 0
Ethereum runs on proof-of-work which relies on pure computing power, or ‘work’ to ensure consensus among all participants. This is wasteful of computer power, even though it is being used to secure the Network.
A proposed move to the more environmentally friendly consensus mechanism known as proof-of-stake would at least conserve the environment by cutting down on the emissions.
- Decentralisation (0 to 50) = 10
Ethereum is decentralized as it uses smart contracts for participating parties to secure agreements between one another. Through the use of smart contracts coupled with Ethereum Virtual Machine, Ethereum maintains a high level of decentralization.
A study conducted in February 2018 by Professor Emin Gün Sirer demonstrated that Ethereum is much more distributed than Bitcoin with nodes better spread out around the world. This results in the Ethereum network being more decentralized than its elder brother – Bitcoin. However as price rises this decentralization dissapears and there have been times when the hash rate has been fully centralised by Chinese mining groups.
Security (-250 to 0) = -140
- Reorg, 51% & Brute Force Attack (-100 to 0) = -50
Independent Security Evaluators (ISE) published a report about the Ethereum blockchain claiming that poorly implemented private key generation is facilitating the theft of EHT.
ISE also said they discovered 732 private keys as well as their corresponding public keys that committed 49,060 transactions to the Ethereum network.
These damning facts along with rising cases of weak private keys targeted for theft on the Network suggest that a Brute Force Attack on Ethereum is highly likely.
- Potential for Being Banned (-100 to 0) = -40
Since ETH exists as a decentralized platform that is naturally resilient to censorship, attempts to ban it could have a so-called ‘Streisand effect’. This means that any attempt to remove or censor a piece of info would cause an unintended result of publicizing it.
The Network is wildly popular across the globe, and attempting to ban or regulate EHT would be nearly impossible. Their reliance on POW however does bring with it some risks. Thankfully the core team have plans to move to Proof of Stake and despite years of failures in this move, any regulatory pressure would surely give them no option but to make the switch.
- Network Vulnerabilities (-50 to 0) = -40
Ethereum’s code has shown vulnerability in the past and has been the subject of hack attacks, resulting in a loss of public trust. The vulnerabilities affect several layers of the Network, including Ethereum application layer, data layer, consensus layer, network layer, and the Ethereum environment. Here is a list of the entire vulnerabilities in the Ethereum network.
Use Case (0 to 500) = 350
- Initial Main Use Case (0 to 100) = 70
Ethereum was created to offer a robust platform to allow developers to build a blockchain application (Dapps). It was intended to solve the shortcomings experienced while trying to build applications on the Bitcoin blockchain. To date, Ethereum has achieved this purpose and currently harbors 70% of Dapps and altcoin available today.
- Mainnet Live (0 to 200) = 200
Ethereum went mainnet live on July 30, 2015, with thousands of users successfully generating and loading the Ethereum Genesis block. This marked the inception of Frontier, the first Live release of the Ethereum project. With the mainnet launch came the first censorship-proof ‘world computer’ that anyone can program, paying exclusively for what they use and nothing more.
- Additional Use Cases (0 to 100) = 50
Ethereum has many potential real-world use cases. The platform enables developers from a wide array of industries to form their systems on the Ethereum network and is a popular choice for developers to raise capital through ICO’s. The five ultra-useful use cases of Ethereum include Banking & Financial Services Contracts, prediction markets, replacing Escrow, digital identity management, and also ICOs or DAICOs.
The relevance of ICOs however is dwindling rapidly with most ICOs turning out to be scams, this poses serious risks to Ethereum.
- Additional Working Products (0 to 100) = 30
Ethereum is heavily used to build DeFi platforms that leverage decentralized networks to transform old financial products into trustless and transparent protocols that run without intermediaries. Ethereum has 90+ working Apps that can be used efficiently to solve particular challenges. However, congestion and scalability issues are likely to hinder desired the mass adoption of enterprise-class applications on the Network.
Core Team, Partnerships & Developers (0 to 200) = 130
- Core Team & Developers (0 to 100) = 60
Vitalik Buterin is the popular programmer and inventor of the Ethereum platform. He worked at Bitcoin in the early days of cryptocurrency but was disgruntled with Bitcoin’s inflexible code and so created Ethereum. Buterin also spent a long time working and even living with some of the top developers at Ripple.
- Partnerships (0 to 100) = 70
Ethereum already has notable partnerships and interest from big industries that promise further adoption of the Ethereum network in the future. Thirty big banks, tech giants, and other organizations—including J.P. Morgan Chase, Microsoft, and Intel—are uniting to build business-ready versions of the software behind Ethereum. In coming years, Ethereum is expected to pen down more partnership deals to enhance its usability.
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