- Compared to Bitcoin, Ethereum which will eventually be a proof-of-stake blockchain capable of executing smart contracts.
- ETH (Ether) is the native cryptocurrency of the Ethereum platform and is also used as the means of payment for transaction fees and as a reward for miners.
Vitalik Buterin was the one who came up with Ethereum in 2014, and later, it was launched in 2015.
An open-source blockchain network, Ethereum utilises smart contract technology. The domestic cryptocurrency for the Ethereum network is Ether (ETH). This currency is eventually used as the blockchain’s medium of exchange.
What is Ethereum?
Unlike traditional centralised systems, Ethereum operates on a global network of computers that collectively maintain a shared ledger of transactions. All distributed networks ensure transparency, security, and censorship resistance. Thanks to blockchain technology, the information shared on the platform cannot be manipulated or changed after being inserted.
The founders of Ethereum set out to construct a new kind of global, decentralised computing platform that eventually takes blockchains’ security and openness and extends those attributes to a vast range of applicants. You should also know that everything from games and financial tools to complex databases is already running on the Ethereum blockchain. And yes, its future is only limited by developers’ imagination. Ethereum operates via a global computer network that works together as a supercomputer.
How Does Ethereum Work?
Obviously, based on blockchain technology, Ethereum consists of a series of cryptographic or, we can say, public records, that are linked together, and everything is very difficult to change just because they are stamped with user data, time, and date or the changes that all the users must approve.
Anyone can create their financial contract on the ledger, or they can also keep debt or ownership registries with the use of an external recordkeeper or trust officer.
Trustless is the word by which these transactions are called because they try to get rid of the need to trust the party as the contract done was self-fulling.
So, because of its size and scope, the main technical issue of ETH is speed and storage, and it has operated at only a few transactions per second. Conversely, cryptocurrency platforms can carry out of a hundred transactions at a time. Mostly all the users have complained about the same and also about the expenses of using the platform.
Also, for any changes that need to be made to the platform, there must always be a distributed consensus among the software users. According to a recent report, the developers of Ethereum were discussing an upgrade known as Ethereum 1x. This update was rolled out to see the changes and help slow the growth of Ethereum’s blockchain.
What Was the Need to Find Ethereum?
Founded by a 19-year-old Russian-Canadian boy, Vitalik Buterin. His intent was to take Ethereum or the technology that powered Bitcoin’s digital currency. This can also be used to democratise everything from organisations, currencies, and businesses, and it also helps users to create their own country with an unchangeable constitution.
In 2013, he also released a white paper describing his ideas for Ethereum. After this, he was awarded the prestigious Thiel Fellowship for his work along with a $100,000 prize. Later, other developers were attracted by his ideas and joined him in launching a crowdfunding campaign in 2014.
So, in a crowd sale, Ethereum raised up to $18 million, one of the most successful of its time. Its first platform, Frontier, was launched in July 2015.
Conclusion
Ethereum is an open-source blockchain platform that operates on a global network of computers, enabling the execution of smart contracts and decentralisation. Founded by Vitalik Buterin, Ethereum’s native cryptocurrency, Ether (ETH), serves as a medium of exchange and payment for transactions. The platform’s potential is vast, limited only by developers’ imagination, and it aims to revolutionise various industries with its trustless and transparent approach. However, ETH faces challenges related to speed, scalability, and expenses, which the developers continuously work on through upgrades and improvements.
