What is Ethereum?


Ethereum is a cryptocurrency that can be exchanged for other cryptocurrencies. Ethereum allows people to exchange the currency without centralized banking systems, which are vulnerable to hacking threats.

The platform also has smart contracts that allow e-commerce without the need for third party development or escrow services. Ethereum is known as “Bitcoin 2.0” because it offers features beyond simply being a currency.

Ethereum is a decentralized platform that runs smart contracts: applications that run exactly as programmed without any possibility of fraud or third-party interference. Ethereum is powered by Ether, a cryptocurrency whose value is determined by the market.

Ethereum was proposed in late 2013 by Vitalik Buterin, a cryptocurrency researcher and programmer. Development was funded by an online crowd-sale between July and August 2014. On 30 July 2015, the system went live with 11.9 million coins “pre-minted” for the crowd sale.

In 2016, Ethereum was forked into two separate blockchains - Ethereum and Ethereum Classic. Ethereum Classic continues the original Ethereum blockchain, supporting the same features but under a different governance model.

The Ether token and its blockchain power Ethereum.

To understand Ethereum, it’s important first to understand blockchain technology. A blockchain is a digital ledger of all cryptocurrency transactions. It is constantly growing as “completed” blocks are added with a new set of recordings.

Each block contains a cryptographic hash of the previous block, a timestamp, and transaction data. Bitcoin nodes use the blockchain to differentiate legitimate Bitcoin transactions from attempts to re-spend coins that have already been spent elsewhere.

Ethereum goes beyond just money and payments. Its goal is to be a decentralized world computer where anything can be done provided it can be expressed in code and runs on the Ethereum network.

Ethereum works using blockchain technology. A blockchain is a digital ledger of all cryptocurrency transactions. It constantly grows as “completed” blocks are added with new recordings. Each block contains a cryptographic hash of the previous block, a timestamp, and transaction data. Bitcoin nodes use the blockchain to differentiate legitimate Bitcoin transactions from attempts to re-spend coins that have already been spent elsewhere.

Ethereum nodes use the blockchain to differentiate legitimate Ethereum transactions from attempts to re-spend coins that have already been spent elsewhere.


Ethereum