What is Ethereum?
Although Ethereum and Bitcoin have similarity in some cases, they are totally separate projects with different purposes. In this article we are going to talk about that what is Ethereum, its core properties and how it can potentially impact our society.
An absolute majority of online services, businesses and enterprises are built on a centralized system. It means that it controls by a single entity. This approach has been used for hundreds of years. Although it’s proven that it’s flawed, its implementation is still necessary when the parties don’t trust each other. In some cases, it could be a point of failure which makes the system extremely vulnerable to hacker attacks. Most online servers or social networks require users to reveal their personal information and identity and then store them all on their servers. So, this data could stolen by the company or even hackers.
In the other hand, Ethereum is a decentralized system. It means that it does not get control by any person, government or institution entity. Ethereum runs from thousands of computers around the world and it never go offline which means there is no central point of failure.
Ethereum is a whole network, it has its own internet browser, algorithms and payment system. In fact, Ethereum took the technology behind Bitcoin and expanded its features and capabilities.
As we mentioned before, Ethereum system supported by thousands of computers globally called as “nodes”. Nodes are volunteers that download the entire Ethereum’s Blockchain on the computers and keep the network honest. They enforce all the consensus rules which dictated by “smart contracts” and receive rewards in return.
Smart contracts designed to automatically perform actions within the network as well as transactions with parties that you may not trust. All the terms pre-programmed into the contract and needs to get fulfill with both parties for a transaction or any other specific action to happen. Smart contracts provide more security in compare to traditional agreements. In addition, establish trust between two parties and reduce transaction costs associated with contracting. Many believe that in the near future traditional contracts will get replace by smart contracts.
Who is Ethereum Creator?
Vitalik Buterin published his idea in a white paper in 2013 and sent it to his friends. Although those people pointed out critical mistakes in the concept, it never happened. Finally, in January 2014 Buterin presented Ethereum at a Bitcoin conference in Miami. After a while the team behind it decided to hold a crowd sale for the token of the network called “Ether”. The team behind Ethereum is consist of Vitalik Buterin, Mihai Alisie, Anthony Di Iorio, Charles Hoskinson, Joe Lubin and Gavin Wood.