Ethereum, currently the second largest cryptocurrency after Bitcoin, will experience a “monumental, defining global breakout” when smart contracts can accept outside data.
The bullish prediction from influential technology expert, Ian McLeod of Thomas Crown Art, the world’s leading art-tech agency, comes as Ethereum’s price jumped 4 per cent on Monday, adding some 8 per cent over the last week, to trade at highs of $210.
McLeod comments: “Ethereum is back in bull territory and is on track to enjoy considerable gains before year-end. I maintain that we can expect Ethereum to hit $500 by the end of 2018 and go on an overall upward trajectory throughout 2019. However, what will be the monumental, defining driver for its global breakout? Oracles. Oracles link Ethereum-run smart contracts to the real world and will be responsible for the digital currency to enter an entirely new phase of mass adoption.”
Oracles are trusted data feeds that deliver information into the smart contract, thereby taking away the requirement for smart contracts to directly access information outside their network. Typically, oracles are usually supplied by third parties which are authorised by the organisations that use them.
McLeod continues: “Oracles are a massive step forward in the practical utilisation of smart contracts. They allow smart contracts to accept outside data to decide upon an action – and this has a myriad of highly-demanded, real-world use-cases in almost every sector.
“For instance,” he says, “they can help insurance companies with pay-outs on flight delays, sports betting firms with result information coming from various trusted sources, and can help us in the art world by conclusively proving the provenance of artwork quickly and easily.”
He adds: “Using a blockchain to authenticate artwork is an ideal use-case for smart contracts. They provide the ability to store a permanent, immutable record of artwork at the point of creation which can be used to authenticate registered works. Oracles will further enhance this concept and lighten smart contracts’ work processes.”
The tech expert concludes: “When Ethereum-based smart contracts are fed a robust and reliable information through oracles to make precise and correct judgements, Ethereum’s price will explode.”
Last month, Mcleod noted: “We can expect Bitcoin to lose 50 per cent of its cryptocurrency market share to Ethereum, its nearest rival, within five years.
“Ethereum is already light years ahead of Bitcoin in everything but price – and this gap will become increasingly apparent as more and more investors jump into crypto. ”