The Reason Why It is the Greatest Block Chain Network Ever Created: Ethereum
In January of 2014 at the North American Bitcoin Conference in Miami, Florida, Vitalik Buterin formally announced ethereum. The 19-year old Canadian –Russian programmer had been working on numerous bitcoin projects when he conceived the idea of ethereum. He was inspired by the problems he faced when trying to build applications on the bitcoin block chain. He believed that the potential of block chain technology was not limited to financial applications and quickly decided to create a block chain that could support more common computations. Ethereum was built to allow developers to build a wide spectrum of block chain applications. He succeeded.
Vitalik Buterin discovered bitcoin and cryptocurrencies in 2011 and that same year he co-founded the Bitcoin magazine and wrote many articles explaining his views on the future of the digital currency. He later worked on some cryptocurrencies such as the Mastercoin that are based on the Bitcoin codebase. These projects made him realise that bitcoin block chain was limited in scope; he wanted a block chain with a much wider spectrum, so he created ethereum.
In addition to Buterin, ethereum was cofounded by Mihai Elsie, Anthony Diloroi and Charles Hoskinson. Buterin also made known that he was working with developer Dr. Gavin Wood and Joseph Lubin. The ethereum white paper was released in 2013 and it documented an open — source protocol for creating decentralized applications. Dr. Gavin Wood released the Ethereum yellow paper, which covered the Ethereum Virtual machine (EVM), the runtime environment that executes all of the smart contracts of the network. Lubin later created CosenSys : a venture studio focusing on decentralized applications.
The ethereum foundation held an Ether crowd sale in July 2014 during which they sold 60 million tokens. 12 million ether tokens were later created so that the ethereum foundation could expand its development and marketing efforts. The ethereum network and community have grown substantially, and ethereum is now considered the second most important cryptocurrency in the world after bitcoin yet it also the most popular among block chain application developers because it has a wide spectrum of usability; it is friendly and adaptable.
So, like bitcoin, ethereum is a distributed public domain network. As I initially explained, there are many differences between bitcoin and ethereum ; the most important distinction is that bitcoin has lesser applications particularly the peer to peer electronic cash system that enables online bitcoin payments. While bitcoin block chain focuses on tracking the ownership of digital currency (bitcoins), the ethereum block chain focuses on running the programming code of any decentralized application.
In the ethereum block chain, instead of mining for bitcoin, miners work to earn Ether, a type of crypto token that fuels the network. Apart from being a tradeable cryptocurrency, ether is also used by developers to pay transaction fees and services on the ethereum network.
There is another type of token that is also found in the ethereum blockchain network: the gas. This token is used to pay miners fees for including transactions in their block and every smart contract execution requires a certain amount of gas to be sent along with it to attract miners to put it in the blockchain. The gas can be compared to the energy in the bitcoin network , which has to be expended numerous times as the miners guess the code of the block.
You must be wondering what a smart contract is. Well, it is a phrase used to define a computer code that can facilitate the exchange of money, content, property, shares or anything of value. When mining in the block chain, a smart contract becomes an independent, self-operating computer program that automatically executes when specific conditions are met. Smart contracts run exactly as programmed without any possibility of censorship, fraud or third party interference: it is hack proof.
The most important property of ethereum block chain is that it allows for a wide variety of applications. This means that the developers can create whatever operations they want. They can build thousands of different applications that surpass the limitations we have seen before.
The Ethereum Virtual Machine (EVM) has enabled the expansion of operations that block chain developed applications can perform. Initially before the invention of ethereum, most blockchains had limited designs and functions; most like Bitcoin only had the peer to peer digital system. The developers were faced with an opportunity to either expand the functions offered by the bitcoin ( which was tiresome and time-consuming) or develop a new blockchain application and an entire platform as well. Vitalik Buterin saw and grabbed the opportunity; Voila! Ethereum was built!
Ethereum Virtual Machine (EVM) is a software that enables anyone to run any program in the ethereum network, regardless of the programming language given enough time and memory. The Ethereum Virtual machine makes the process of creating block chain applications much easier than ever before. Instead of having to build an entirely original block chain for each new application, ethereum enables the development of thousands of different applications all on one platform.
By now you know that ethereum enables developers to build and deploy decentralized applications. A decentralized application serves a particular purpose to its users. Bitcoin, for example, provides users with a peer to peer electronic cash system that enables online bitcoin payments. Because decentralized applications are made of code that runs on a block chain network, they are not controlled by any individual or central entity. Any services that are centralized can be decentralized using ethereum. For example the loan services across banks and voting systems.Ethereum can also be used as a platform to launch other cryptocurrencies.
In conclusion.
If you want to develop an application on ethereum network then one of the easiest ways is to use its native Mist browser. Mist provides a user-friendly interface and digital wallet for users to trade and store ether as well as write, manage, deploy and use smart contracts. Like web browsers give access and help navigate the internet, Mist provides a portal into the world of decentralized blockchain applications.
Even people without a technical background can now build block chain apps. Ethereum block chain is indeed a critical player in the future of cryptocurrency.
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