Ethereum is a blockchain-based open and distributed computing platform and open-source operating system, characterized by smart contract (scripting) functions. It supports a modified version of the Nakamoto consensus via transaction-based state transitions.

Ethereum is the token that the Ethereum platform creates the blockchain. Ether can be transferred between accounts and used to compensate for the mining nodes involved in the accounts that have been conducted. Ethereum provides a decentralized virtual machine (EVM), enabling it to implement Scripts using an international network of public nodes.

It is believed that the instruction set for the virtual machine, unlike other groups such as Bitcoin script, uses gas, which is an internal transaction pricing mechanism, to mitigate spam and allocate resources on the network.

The Ethereum coin was proposed in late 2013 by Vitalik Buterin, a researcher and cryptocurrency programmer. A crowd of people funded the project on the Internet, which happened between July and August 2014. Then the system went into operation on July 30, 2015, with 72 million coins. This represents about 68 percent of the total supply in circulation in 2019.

In 2016, as a result of exploiting a flaw in the smart contract program for the DAO project, after a $ 50 million worth of Ether was stolen, the Ethereum coin was split into two separate parts. The new different version became Ethereum (ETH) with the reversal of the theft, and the original version continued under the name Ethereum Classic. Ethereum Classic (ETC.

Ethereum in a simple way

Vitalik Buterin chose the name Ethereum after browsing through Wikipedia articles on elements and science fiction, which is part of what he said when he found the appropriate name “I immediately realized that I liked me better than all the other alternatives I saw, I think it was the truth. It looked nice, and it was It has the word “ether,” referring to the hypothetical, invisible medium that permeates the universe and allows light to travel.”

The history of Ethereum cryptocurrency

Ethereum was initially described in a white paper by Vitalik Buterin, a co-programmer with Bitcoin Magazine, in late 2013 to build decentralized applications; Buterin argued Bitcoin needs a programming language to develop the application. He disagreed and suggested creating a new platform with a more general text language.

Ethereum was announced at the Bitcoin North America conference in Miami in January 2014; during the meeting, many people rented a house in Miami. They are Gavin Wood, Charles Hoskinson, Anthony de Eurio. Torrononi, who funded the project, De Iureo invited the friend Joseph Lubben, who asked reporter Morgan Beck, to testify.

Six months later, the founders met again at a house in Zug, Switzerland, where Putin told the founders that the project would go ahead as a non-profit; Hoskinson left the project at the time.

The Ethereum coin software project’s official development began in early 2014 by a Swiss company, Ethereum Switzerland GmbH (EthSuisse). The basic idea of ​​placing executable smart contracts in the blockchain must be determined before the program is implemented, and Gavin Wood carried out this work. The chief technology officer in the Ethereum Yellow Paper that identified the Ethereum Virtual Machine, later a Swiss not-for-profit foundation (Stiftung Ethereum), was created. An online audience funded the development process during July and August 2014. Participants buy the Ethereum value symbol (Ether) in another digital currency, which is Bitcoin.

While there was early praise for technical innovations through Ethereum, questions were also raised about its security and scalability.

DAO event

In 2016, an independent, decentralized organization called The DAO, a group of smart contracts developed on the platform, raised a record USD 150 million in a crowd to fund the project.

The DAO was exploited in June when $ 50 million in Ether was seized by anonymous hackers; the event sparked a debate in the crypto community about whether Ethereum should change the blockchain reallocate affected funds.

As a result of the dispute, the network split into two; the Ethereum coin continued on the forked blockchain. In contrast, the Ethereum Classic continued on the original blockchain; the blockchain’s change created a rivalry between the two networks.

After the change in the DAO-linked blockchain, Ethereum then formed twice in the fourth quarter of 2016 to deal with other attacks; by the end of November 2016, Ethereum had increased DDoS protection, removed the chain block, and thwarted more intruder attacks.

Ethereum features

The Foundation developed several prototypes codenamed for the Ethereum platform as part of a proof-of-concept series. Before the Border Network’s official launch, Olympic was the last of these prototypes and was the public beta.

The Olympic Network provided users with 25,000 Ether bugs to test stress at the boundaries of the Ethereum blockchain. The initial beta release of the Ethereum platform was celebrated in July 2015.

Since its initial launch, Ethereum has gone through several planned protocol upgrades, which are significant changes affecting its core functions and incentive structures.

Protocol upgrades are accomplished by splitting the open-source codebase.

They were the first promotions to be considered stable. It included improvements in transaction processing, gas pricing, security, and a split on July 31, 2015.

The first split implementation began on October 16, 2017, and included changes to reduce the complexity of EVM and provide more flexibility for smart contract developers.

As with other cryptocurrencies, the validity of all Ether is provided by the blockchain, an ever-growing list of records, called blocks, that are linked and secured using cryptography by design. The blockchain is inherently resistant to data modification. It is an open ledger and distributor that records the transactions between the two parties efficiently and in a verifiable and lasting manner; unlike Bitcoin, Ethereum currency works using accounts and balances in a way called state shifts.

Comparison of Ethereum with Bitcoin

Ethereum differs from Bitcoin (the cryptocurrency with the most considerable market value) in several aspects:

Block time is from 14 to 15 seconds, compared to 10 minutes for Bitcoin.

Ether mining generates new coins at a steady rate, usually constant, sometimes changing during changes in the blockchain, while Bitcoin halves every four years.

For proof of work, the Ethash algorithm is used, which reduces the mining specialist ASIC’s benefit.

Transaction fees vary according to computational complexity, bandwidth usage, and storage needs (in a system known as gas), while Bitcoin transactions compete by transaction size in bytes.

Each unit of Ethereum gas has a price that can be determined in the transaction. This is usually measured by air, and Bitcoin transactions typically have a fee specified in satoshis per byte.

Ethereum currency uses an accounting system in which Wei’s values ​​are deducted from accounts and added to another account, instead of the UTXO system for bitcoin, which is more similar to spending cash and receiving change in return.

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