Definition of Ethereum
Ethereum is based on the blockchain technology and since it is an open source platform it allows the developers to create and deploy the decentralized applications. It can be considered as a public platform for distributed computing and the operating system which features the smart contract functionality which is known as scripting. It can be transferred between different accounts and used to compensate people. The Ethereum virtual machine (EVM) is a virtual machine which is decentralized and can be used to execute the scripts.
History of Ethereum
The blockchain of the cryptocurrency Ethereum is generated through the Ethereum platform. The cryptocurrency, Ethereum, was proposed in the year 2013 by Vitalik Buterin who is a programmer and a cryptocurrency researcher. The development of the Ethereum was funded by the online crowdsale which took place somewhere between July 2014 and August 2014.
What is meant by the smart contract?
It is only a phrase which is used to define a computer code which can effectively facilitate the exchange of funds, property, shares, content or anything else which is of some value. When the smart contract is run on the blockchain it becomes similar to a computer program which is self-operating. It can automatically execute on meeting the specific conditions or requirements. It runs exactly as they are programmed because they run on the blockchain. There is no possibility of downtime, censorship, interference from the third-party and fraud. All the blockchains have the ability to process the code but most of them are severely limited. However, Ethereum is quite different from other cryptocurrencies because it allows the developers whatever options they wish to create. This has allowed the developers to build various different applications.
What exactly is Ethereum Virtual Machine (EVM)?
The blockchains could only create a very limited set of operations before Ethereum was created. It would have been complex to expand the set of functions performed by the Bitcoin and other cryptocurrencies and hence a new approach was developed to solve this problem. The Ethereum virtual machine (EVM) is a software which runs on the Ethereum network. This allows the user to run any program irrespective of the programming language. The Ethereum virtual machine (EVM) has made the process of designing and developing the blockchain application quite easy and more effective than it was ever before. Ethereum has allowed the user to design various different applications all on a single platform.
The difference between Bitcoin and Ethereum
Ethereum is just like Bitcoin and is a blockchain network which is publicly distributed. However, there are a number of differences between Ethereum and Bitcoin and the most important distinction to remember is that the two substantially differ in capability and purpose. Bitcoin can only offer one use of the blockchain technology which allows only for the Bitcoin payments. The blockchain of Ethereum entirely focuses on running the programming code of the decentralized currency. Whereas the Bitcoin blockchain can be used to track the ownership of the digital currency, Bitcoins. The miners in the Ethereum operate to earn a cryptocurrency known as ether which is used to fuel the network instead of mining the Bitcoins. Other than being able to be used as a tradeable cryptocurrency, it is also used by the application developers to make payments for the services and transaction fees on the Ethereum network.
The uses of Ethereum
Ethereum allows the developers to create and deploy decentralized applications which serve some particular purpose to the person who might use it. Since the decentralized applications are built of codes which will only run on the blockchain network, they cannot be controlled by any individual or a central entity. Any services which were earlier centralized can with the use of Ethereum be decentralized. Ethereum has also been used recently in the launch of other cryptocurrencies. Hence the uses of Ethereum can be summed up in the following points.
- It facilitates transactions.
- It offers a decentralized system for storing data.
- It can also be used in the gambling industry.
The benefits of Ethereum
- It can provide privacy from the third-party interference and no changes can be made by the third-party to the data.
- Since there is no centralized system there is no way for a hacker to attack and break into it.
- The Ethereum can also help in fundraising with a maximum impact.
- It has more availability of coins as compared to Bitcoins.
- Since the applications are based on the network which is formed around the consensus principle, it makes censorship impossible.
- There is zero downtime which means the application is never switched off and will never go down either.
The downside of Ethereum
Just like the other cryptocurrencies, Ethereum also has its downside and the biggest drawback comes from it being a decentralized application system. Since the smart contract codes are written by humans, it is very likely for these codes to be faulty. These often lead to adverse actions which are unintended. Also, there is no way to stop an attack or exploitation efficiently because if any action is taken by the central party, it would completely defeat the meaning of a decentralized application.
What is the future of Ethereum?
Ethereum is comparatively new in the market. It released the blockchain technology only a few years ago. The interest has varied from one token to another with the release of new cryptocurrencies but Ethereum has gained popularity very quickly. The fact that it is not only a cryptocurrency but has an infrastructure for crowdfunding, contracts and offering something which was not available in the market earlier are the most prominent factors for the popularity of Ethereum. These factors have promised Ethereum success for a long-term. The developers of Ethereum are working on the code which other blockchains technologies normally lack. It is expected that Ethereum would become one of the largest companies in the world in the field of cryptocurrency.
Short Summary
What is Ethereum? Everything you need to know
Introduction of Ethereum
Ethereum is based on the blockchain technology and is an open source platform. It allows the developers to create and deploy the decentralized applications. It can be transferred between different accounts and used to compensate people. The Ethereum virtual machine (EVM) is a virtual machine which is decentralized and can be used to execute the scripts. The blockchain of the cryptocurrency Ethereum is generated through the Ethereum platform. The cryptocurrency, Ethereum, was proposed in the year 2013 by Vitalik Buterin who is a programmer and a cryptocurrency researcher. The development of the Ethereum was funded by the online crowdsale which took place somewhere between July 2014 and August 2014.
The Ethereum virtual machine (EVM) is a software which runs on the Ethereum network. This allows the user to run any program irrespective of the programming language. The Ethereum virtual machine (EVM) has made the process of designing and developing the blockchain application quite easier and more effective than it has ever been.
Ethereum allows the developers to create and deploy decentralized applications. Since the decentralized applications are built of codes which will only run on the blockchain network, they cannot be controlled by any individual or a central entity. Ethereum has also been used recently in the launch of the other cryptocurrencies.
It can provide privacy from the third-party interference. Since there is no centralized system there is no way for a hacker to attack and break into it. It has more availability of coins as compared to Bitcoins. Just like the other cryptocurrencies, Ethereum also has its drawbacks. There is no way to stop an attack or exploitation efficiently because if any action is taken by the central party, it would completely defeat the meaning of a decentralized application.