History, curiosity and challenges of the boy who created the blockchain that is worth 25 billion today

«In elementary school everyone called me a mathematical genius. I was happy, but only partially. I wanted to be a normal person for others ", recalls Vitalik Buterin, 25, is the inventor of Ethereum, the blockchain with the second most important capitalization in the world, 25 billion dollars, its value at the time of writing.

Of "normal", little Vitalik has nothing at all. At the age of six, he knows how to multiply three-digit numbers, without any trouble. The teachers soon realize his precocious intelligence, so much so that they allow him to make the first leap of his life, in a class of super brains.

Feeding his genius is his father, Dmitry, a Russian computer engineer, born in Kolomna, a city of just over 100 thousand inhabitants. Vitalik's first memories are in Canada, where his parents move. It is in the nation of the maple leaf that he cultivates the first interests. Unlike children of his age (the fashion of Lego goes crazy) he enjoys playing with Excel, with which he learns to make the first basic calculations.

The love for the blockchain and the crypto does not immediately bloom, a paradox for the boy who would have written the second chapter of technology. His father is the first to tell him about it when Vitalik is little more than a teenager: "He told me about this currency that was not supported and controlled by any government. My first reaction was denial. How could I be interested in a technology that had so little impact on the world? "

The first contacts with the crypto lovers

What is a rebellious reaction of a teenager towards his father, soon turns into a wild curiosity. Vitalik uses the Internet for information. To understand more, he signs up in various forums and thus comes into contact with the first crypto lover community. His participation at the beginning is limited: he has no money to buy bitcoins or even the computing power to undermine them.

Then he uses the knowledge he has acquired on the blockchain to write articles, getting paid in bitcoins: "There was a person who edited a bitcoin blog. I agreed with him for 5 bitcoins per article, more or less four dollars, at that time ".

His articles attract the attention of Mihai Alisie, a Romanian boy. They know each other on a forum and decide to found a newspaper together. It's called Bitcoin Magazine and in a short time it becomes a reference point for the sector. For Vitalik it is a period of great work, divided between the newspaper, the courses at the University of Waterloo in economics and a part-time job as an assistant researcher for Ian Goldberg, a famous cryptographer, author of a protocol, still used today to encrypt messages.

Between Silicon Valley and Israel

Vitalik is a good saver. He puts the first bitcoins in the farmhouse and uses them to travel the world. In May 2013, the journey that has a great impact on its formation. The destination is San Jose in California. He is there as a reporter for Bitcoin Magazine in one of the most important events on bitcoin and blockchain.

It is for him the opportunity to get to know the beating heart of the community, developers, investors, startuppers, people who have given up everything and work day and night to pursue the dream of Satoshi Nakamoto, the name behind which bitcoin's dad is hiding: « I realized that the community was real. There were people who followed that world as they do with a religion. It was worth taking a risk to be part of it. "

Vitalik gets carried away by the "sirens of Nakamoto", leaves university and thinks about a way to make a valuable contribution to that universe that excites him. For a good six months he moved from one corner of the globe to another (he would stop in London, Amsterdam, Las Vegas ...) to meet entrepreneurs working on new versions of the bitcoin blockchain.

A project in Israel attracts his attention and decides to be part of it. It's called Mastercoin, and it's a startup that offers services in finance. The idea of ​​the founders is to register and file financial contracts on the blockchain: «Instead of registering the contracts, it would have been possible to go much further, creating a way to stipulate them automatically. I started thinking about contracts between people no longer just as a relationship, but as objects that could, thanks to the code, have a life of their own. "

A keyword: smart contracts

In Israel, Vitalik thinks about the possibility of creating a new, more flexible blockchain that would come out of the sphere of payment, to become a tool with which anyone could create new applications, cryptocurrencies, tokens. The seed of the idea of ​​Ethereum is implanted in his mind.

To allow these infinite possibilities of creation for developers and startuppers, we need a technology that allows us to establish contracts between people, directly on a blockchain. All this is possible, thanks to smart contracts, a key word to understand the revolution that Vitalik is about to bring to the blockchain world.

These are software that automatically execute an instruction based on external events. For example, the delivery of a home delivery, unlocks the payment for the same. The rules of the blockchain guarantee their functioning while the results of the contract are verified by the participants of the network.

The genius is not only the one who creates, but who knows how to reuse existing technologies to give them new life. The idea of ​​smart contracts is not Vitalik's, it belongs to Nick Szabo, one of the most influential entrepreneurs in the cryptocurrency field. Vitalik's genius is to have welcomed them into the core of Ethereum's design, unlike the bitcoin blockchain which is designed solely as a P2P payment system.

The Ethereum White Paper starts drafting it in 2013. After writing it, it sends it to the founder of Mastercoin, which, however, sends the idea back to the sender: «He told me that the idea was interesting, but that it would take too long time to develop it. I was angry and I replied, "Fuck you, I can do it alone." After a few weeks I sent it to a group of developers to get their feedback, "he says in an interview.

The Ethereum White Paper
 

Vitalik has another decentralized platform in mind. In the White Paper he starts from the weaknesses of the blockchain (like some limitations known to everyone in the scripting language) and writes of his idea of ​​creating an alternative product for "decentralized applications":

Despite the bravado demonstrated with the Mastercoin founder, he is pervaded by doubts. As soon as he sends the White Paper to the team of developers he trusts, he expects the harshest criticisms: "When I had the idea of ​​Ethereum, my first thought was," it's too good to be true " . I was sure that my cryptographic friends would have pointed out to me how stupid I was not to notice the weaknesses of the project ».

Yet, despite his fears, none of the fifteen initial minds made known to Ethereum find insurmountable obstacles, indeed they are all enthusiastic. The common reaction is that Vitalik is giving life to a real revolution. Many of these minds then joined the Ethereum team (Mihai Alisie, Anthony Di Iorio, Charles Hoskinson, Jeffrey Wilcke, Gavin Wood, Joseph Lubin, to name just a few of the most influential) who first introduced themselves in a conference in Miami, receiving a long standing ovation from those present.

Vitalik and his team moved to Switzerland, to the Canton of Zug, which would later be baptized years later, Crypto Valley, still the home of the Ethereum Foundation, the non-profit organization, responsible for Ethereum and its open source software.

You need money to develop the project. To recover them, the team decided in 2014 to create a new crypto, the ether, which make the platform attractive to investors. With the ether part of the ICO (fundraising for new projects in the field of cryptocurrencies). Ethereum, sells 2 thousand ether for the price of a bitcoin. At the end, it collects 31 thousand bitcoins, a value close to 18.4 million US dollars, becoming the third ICO to have collected more.

In 2015, the launch of the first version, named Olympic, is put on the market. The prototype is promising, but full of bugs. To find them as quickly as possible, Ethereum launches a reward program: anyone who found bugs in the system would be rewarded with ether.

On March 14, 2016, Ethereum updates its version in what is now considered the official launch of the platform.

«To build the platform I had put together everything that interests me: mathematics, cryptography, economics and politics. It is a fascinating experience that I live with a community that fluctuates between capitalism and social impulses, but always with a strong libertarian impulse, "says Vitalik in an interview in Il Corriere della Sera.

Blockchain and Ethereum: calculator vs smartphone?

"Think of the difference between a calculator and a smartphone. The calculator does one thing and does it well. While with a smartphone you have a calculator like app and also many other apps. You can listen to music, surf the Internet and do other things. So Ethereum has increased the power of the system ", Vitalik uses this simile in an interview in Business Insider to explain the differences between Blockchain and Ethereum.

Thanks to its adaptability to multiple uses (token creation, ICO release, centralized applications, up to political uses, as a voting platform ...) Ethereum becomes a reference point for developers across the planet.

A shy genius
 

In Silicon Valley a comparison is often made between two genes of this generation. On the one hand Mark Zuckerberg, on the other Vitalik Buterin: "While Mark is rumored to have built his head, Vitalik has remained a humble and shy boy, with obvious difficulties in relating to others," he tells Startupitalia !, Lorenzo Rigatti, manager of the blockchain and founder of RealHouse Srl, a platform that works to develop technologies to tokenize real estate.

Lorenzo met Vitalik at the San Francisco Blockchain Week in 2018 and asked him some questions about the future of Ethereum: «Tell us a few minutes and you immediately realize that you are facing a genius. A very polite boy, he seems to have done bon ton courses, he always speaks in a low voice and knows how to give a lot of space to the other members of the management of Ethereum, of which he never misses an opportunity to recognize the importance ».

«He is very critical of himself - Lorenzo continues - and wants to really change the world. Today he is working on two important transformations of Ethereum, always with the will to never lose decentralization, he is obsessed by this aspect ".

The future of Etherum: from POW to POS and really smart contracts

Vitalik and the Ethereum team are working on a complex and fascinating transformation, the transition from POW (proof of work) to POS (proof of stake).

For the uninitiated, POW and POS are the mechanisms to ensure consensus on the blockchain and to add blocks to the chain. In the POW, the transaction validators are remunerated with the creation of new bitcoins (the mining activity) and with the transaction fees. In the POS, instead, the validators are frozen a certain amount of cryptocurrency. In case of incorrect attempts (eg validation of fraudulent operations), they lose part or all of the frozen amount. What do they earn? They get percentages on the validated transaction.

Unlike the POW, which requires a large percentage of electricity to be realized, the POS is more economical and environmentally friendly: «It will be an epochal change and Vitalik knows that in order to achieve it it must overcome many doubts of the community. It's not his only challenge, the other one is called smart contract by his own admission, now I'm not "so smart". The team is working to make every type of contract translatable into smart contract, while today there are many contractual spheres that are not yet adaptable to the system ", explains Lorenzo.

These are the two major challenges that Vitalik will have to overcome in order to fulfill his dream of creating the new Internet of trust: «Ethereum aims to become a reference point for all startups that launch blockchain projects, and will become more and more integrated into every model of business », concludes Lorenzo.