Ethereum is a decentralized platform that runs smart contracts: applications that run exactly as programmed without any possibility of downtime, censorship, fraud or third party interference.
These apps run on a custom built blockchain, an enormously powerful shared global infrastructure that can move value around and represent the ownership of property. This enables developers to create markets, store registries of debts or promises, move funds in accordance with instructions given long in the past (like a will or a futures contract) and many other things that have not been invented yet, all without a middle man or counterparty risk.
The project was bootstrapped via an ether pre-sale during August 2014 by fans all around the world. It is developed by the Ethereum Foundation, a Swiss nonprofit, with contributions from great minds across the globe.
Bitcoin has a reputation for being difficult to start with, but some cryptocurrencies are even worse: Ethereum is a lot more complicated than Bitcoin.
Ethereum works in the same way as Bitcoin, but it’s designed to do more than just be a currency: it can store computer code. In this way, you can then use Ethereum to make all sorts of different applications, including smart contracts and escrows.
The cryptocurrency of Ethereum is called Ether. Ether is used by developers to pay for transaction fees and services on the Ethereum network.
Ethereum was created in 2015 by Vitalik Buterin, a Russian-Canadian programmer (and child prodigy) who originally wanted to do something with Bitcoin. Unable to convince the greater Bitcoin community of his ideas, he decided to create his own cryptocurrency instead.
Ethereum is a decentralized platform that runs smart contracts: applications that run exactly as programmed without any possibility of downtime, censorship, fraud or third-party interference.
These apps run on a custom built blockchain, an enormously powerful shared global infrastructure that can move value around and represent the ownership of property. This enables developers to create markets, store registries of debts or promises, move funds in accordance with instructions given long in the past (like a will or a futures contract) and many other things that have not been invented yet, all without a middle man or counterparty risk.
The project was bootstrapped via an ether pre-sale during August 2014 by fans all around the world. It is developed by the Ethereum Foundation, a Swiss nonprofit, with contributions from great minds across the globe.
Ethereum is often described as a digital currency but here’s something important to keep in mind: it isn’t like one. Most digital currencies are limited entries in a database no one can change without fulfilling specific conditions. But Ethereum is more than just a currency; it’s like one big computer housing many computers around the world.
Ethereum can respond to sophisticated requests. The possibilities are endless because this computing system is decentralized: it exists on computers all over the world at
Ethereum is similar to Bitcoin in that it’s a digital payment and cryptocurrency, but it’s built for a different purpose. While the Bitcoin blockchain is used to track ownership of digital currency (bitcoins), the Ethereum blockchain focuses on running the programming code of any decentralized application.
While one can use the Ethereum blockchain to track ownership of its own digital currency, it was designed to provide a flexible platform where developers can create all sorts of programs, ranging from currencies to voting systems, financial exchanges, document storage, ride-sharing applications and more.
Ether can be used as a form of payment or a store of value. Other digital currencies have come before (see Bitcoin and Ripple), but according to Vitalik Buterin – creator of the Turing-complete scripting language that powers the Ethereum network – ether is fundamentally different from other digital currencies because it allows users to build their own applications on top of it, rather than just use it for transactions.
Ethereum is the second-most valuable cryptocurrency by market cap, behind bitcoin. It’s also been around for a few years longer than bitcoin cash and bitcoin gold, which are younger siblings of the original bitcoin blockchain.
Ethereum’s key feature is that it lets you make smart contracts — software that runs when certain conditions are met. For example, you could write a smart contract so that if someone gives you 15 ETH, the smart contract would automatically pay a third party $5,000 USD.
Ethereum has its own cryptocurrency called ether that can be used to pay for transactions on the network or buy into an ICO.
Ether is the fuel or “gas” used to pay miners to create smart contracts and decentralized applications (dApps) on Ethereum’s platform. Ether is required by anyone wanting to build upon Ethereum platform.
Ether can be transferred between accounts and used to compensate participant mining nodes for computations performed.[1]
When a user loses their private keys, they lose access to their ether funds on the blockchain. In 2016, $50 million in ether was stolen from three ICOs.[2]
Ethereum is the second most popular cryptocurrency after Bitcoin, and the first blockchain network to allow users to build decentralized applications.
Unlike Bitcoin, which focuses on storing value and processing transactions, Ethereum is used by developers to build new kinds of applications on the blockchain.
Ether (ETH) is the currency that powers the ethereum platform and allows users to interact with smart contracts. Ether is also used by developers to pay for transaction fees and services on the ethereum network. The price of ether fluctuates wildly depending on how many people are using dapps and how many transactions are being made on the network.
While the number of merchants who accept cryptocurrencies has steadily increased, they are still very much in the minority. For cryptocurrencies to become more widely used, they have to first gain widespread acceptance among consumers. However, their relative complexity compared to conventional currencies will likely deter most people, except for the technologically adept.
A cryptocurrency that aspires to become part of the mainstream financial system may have to satisfy widely divergent criteria. It would need to be mathematically complex (to avoid fraud and hacker attacks) but easy for consumers to understand; decentralized but with adequate consumer safeguards and protection; and preserve user anonymity without being a conduit for tax evasion, money laundering and other nefarious activities. Since these are formidable criteria to satisfy, is it possible that the most popular cryptocurrency in a few years’ time could have attributes that fall in between heavily-regulated fiat currencies and today’s cryptocurrencies? While that possibility looks remote, there is little doubt that as the leading cryptocurrency at present, Bitcoin’s success (or lack thereof) in dealing with the challenges it faces may determine the fortunes of other cryptocurrencies in the years ahead.