What is Ethereum? A simple explanation for beginners
What is Ethereum? I keep hearing about it all the time, and I see it as the second-largest cryptocurrency in the world, but I cannot comprehend it. Is it as revolutionary as Bitcoin? Can it change the world? As we know, if you want to get a better understanding of Ethereum but are tired of explanations that seem like complete technical gibberish, then in today’s article you will find what you want.
What is Ethereum?
Imagine for a moment that you want to create your decentralized software just like Bitcoin at home, you need to understand how decentralization works in Bitcoin, write code that mimics the same behavior get a huge network of computers to run that code, etc. Ethereum was first proposed in late 2013, it was introduced in 2014 by Buterin, who at the time was one of the founders of Bitcoin Magazine.
Ethereum is also a do-it-yourself platform for decentralized software also known as decentralized dabs. If you want to create a decentralized program that is not controlled by any single person, not even you even though you wrote it, all you have to do is learn the Ethereum programming language called Solidity and start programming, as the Ethereum platform has thousands of independent computers running it means that it is completely decentralized once the software is published on the Ethereum network.
Ethereum is the infrastructure for running decentralized applications
These computers also known as nodes will make sure that it is executed as written. Ethereum is the infrastructure to run decentralized applications around the world. It is not a currency, it is a platform. The currency used to stimulate the network is called Ether but more on that later. The purpose of Ethereum is to achieve true decentralization of the Internet and wait until the Internet becomes centralized.
I thought the internet was already decentralized and that anyone could start their site while in theory, this might be true in practice amazon google Facebook Netflix, and other giants control most of the world Wide Web as we know it and there is almost no Web activity happening Without some sort of intermediary or third party, but once the concept of digital decentralization emerged with Bitcoin, a whole new set of opportunities became available to us.
They can finally begin to envision and design an Internet that connects users directly without the need for a central third party. People can rent hard drive space directly to other people and make the old Dropbox work. Drivers can provide services directly to passengers and remove Uber. Brokers can buy cryptocurrencies directly from each other without the need for an exchange that can be hacked or your money was stolen.
How does Ethereum currency work?
Ethereum allows people to communicate directly with each other without a central authority to take care of things. It is a network of computers that merge into one powerful decentralized machine. Supercomputer, now you know what Ethereum does but we haven’t touched on how it does it, the hardness of Ethereum’s coding language is used to write smart contracts that represent the logic that runs DAPs.
Let me explain that in real life all contracts are a set of ifs and thens meaning a set of conditions and actions. For example, if I pay my landlord fifteen hundred dollars on the first of the month, he allows me to use my apartment. This is exactly how smart contracts work. Ethereum.
Ethereum developers write the terms for their program or DAP and then the Ethereum network executes it. They are called smart contracts because they handle all aspects of performing contract execution management and payment. For example, if I have a smart contract that is used to pay rent to the landlord that doesn’t need to actively collect money, the contract itself knows if the money has been sent. If I do send the money, I will be able to open my apartment door. If I miss the payment, I will be blocked.
Smart contracts and Ethereum
Once a smart contract is published on the Ethereum network, it cannot be edited or corrected even by its original author. It is immutable. The only way to change this contract is to convince the entire Ethereum network that a change should be made. This is almost impossible. This creates a very serious problem because Unlike Bitcoin.
Ethereum was built with It is very difficult to secure the ability to create complex contracts and complex contracts with any contract, and the higher the complexity, the more difficult it is to implement as more room is left for interpretations or more clauses have to be written to handle emergencies using the security means of smart contracts. Treat very carefully every possible way in which a contract can be implemented to ensure that the contract does only what the author intended.
Ethereum was launched with the idea that the code was the law and that the contract on Ethereum was the absolute authority and no one could do so. The contract was broken so well that everything came to a screeching halt when the DAO event occurred, where the DAO or DAO refers to a decentralized autonomous organization that allows users to deposit Money and receive returns based on the investments made by the Dow, and the decisions itself will be outsourced and decentralized.
