What is Ethereum, what is it for and who created it?

Who created Ethereum

According to Buterin, he was inspired to create Ethereum after realizing that Bitcoin’s design could be applied more broadly to mitigate the “horrors” of centralized web services.

In one famous example, Buterin mentioned little suffering while playing the popular World of Warcraft online game, because the developers at the time could make arbitrary changes regardless of the wishes of the users.

Buterin then received a Thiel grant to pursue Ethereum full-time and began working at a nonprofit to help launch the project. The Ethereum Foundation sold 72 million ETH in an online sale, which raised approximately $18 million in funding for the project.

Ethereum continues to attract a passionate community of users, many of whom continue to push its development forward.

Beginner’s Guide to Ethereum (ETH)

One of the most ambitious blockchain projects, Ethereum (ETH) seeks to use cryptocurrency to diversify products and services into many different use cases beyond money.

While Bitcoin claims to act like digital gold, Ethereum has taken a different approach, allowing users to create any number of assets and custom programs that manage their trades.

This has led to (perhaps imperfect) comparisons that Bitcoin is more like email (a very powerful and specialized tool), while Ethereum has more in common with a web browser (its purpose is to enable programs with which users can interact and create) .

This analogy is effective in conveying the reach of Ethereum, because his team creates their own virtual machine and scripting language (needed to run these programs), raises funds by selling their new currency (Ether), and implements a concept called “state.” . . cryptocurrency

Simply put, Ethereum looks at both changes (confirmed transactions on the blockchain) and potential changes that have not yet occurred (state), which is the core of this view.

On Ethereum, these multi-step computing operations are called “smart contracts.” The larger versions of many smart contracts, on the other hand, are called decentralized applications (dapps).
Although primitive today, it is believed that these programs could one day be used to create software that mimics the behavior of some of the world’s largest Internet companies.

Amazon, for example, can be seen as a kind of public service, connecting shoppers through a simple interface with massive and constantly updating inventory stored in databases. In this case, the for-profit company acts as an intermediary and administrator of the technology. In this way,

Ethereum can be seen as an early attempt to use cryptocurrency to create competitive markets that dominate different parts of its now monopolistic services.

As of 2020, Ethereum developers are in the early stages of implementing this idea and are preparing a version of their core code called “Ethereum 2.0“, which will bring new changes.

Why choose Ethereum

At a time when many cryptocurrencies have struggled to generate a single use case, Ethereum is perhaps unique in that it has gone through several distinct phases of high demand.

Private blockchains
Early adopters of Ethereum include major banks and institutions, who leveraged its open source code to create proofs of concept and R&D initiatives in 2015 and 2016.

Those who haven’t copied Ethereum’s code have often been inspired by its approach, including the Linux Foundation’s Hyperledger and R3’s Corda, projects that have copied parts of its architecture but rejected the notion that they needed a new cryptocurrency.

Big banks and corporations would eventually support Ethereum more directly by creating the Enterprise Ethereum Alliance, a non-profit organization whose goal when it was founded in 2017 was to merge the many private banking blockchains with the main blockchain of “Ethereum”.

ICO
Entrepreneurs then flocked to Ethereum in 2017 with the thesis that its platform could be used to raise funds by creating new cryptocurrencies and selling them to global consumers in what were called “initial coin offerings.”

ICOs have taken advantage of the ability Ethereum has given developers to create new cryptographic assets on its blockchain, using token standards without creating a new codebase from scratch.

Entrepreneurial projects that now have their own active blockchains and cryptocurrencies (such as Tron and OmiseGo) would be launched as tokens on Ethereum and thus provide new technology.

Challenge
The most recent wave of network innovation, decentralized finance (DeFi), has found entrepreneurs using Ethereum to create protocols that replicate traditional financial services.

These have included projects like MakerDAO, which designed a protocol that decentralizes the management of a cryptocurrency pegged to the US dollar. Other DeFi projects have sought to automate and decentralize financial services such as lending and lending.