What is Ethereum?
Ethereum is a decentralized network of the likes of Bitcoin. It relies on computer code, mathematics, cryptography, and random actors around the world to operate without central authority.
While the technology is based on the same principles as Bitcoin, Ethereum’s value proposition is different and does not compete directly with the king of cryptocurrencies.
To understand this, it is necessary to remember that a blockchain network is above all a software in the form of lines of computer code. These will dictate a number of rules that will define the characteristics of a given network and determine its future fields of application.
In the case of Bitcoin, the simplicity and robustness of its computer code combined with the various rules established by Satoshi Nakamoto make it an excellent store of value and an ultra-secure and attack-resistant exchange platform.
Ethereum: smart contract and decentralized applications
Ethereum, created in 2015 by Vitalik Buterin, is a platform tailored for the creation of advanced autonomous contracts. They are called “smart-contracts”.
These contracts are neither more nor less than computer code that looks like the one that runs your everyday applications. However, once injected on the Ethereum blockchain, they become autonomous. This means that anyone can use them for their own applications, consult their operations, and they are available 24/7 without possible interruption.
We can imagine it as a public and very secure global computer on which anyone can deploy their own programs. This allows the emergence of a new type of application called dApps, for decentralized applications.
The advantage of a decentralized application, again, is that it is extremely resilient, transparent, and does not centralize data in an organization’s servers.
These characteristics of stand-alone contracts make them unique and make it possible to create new types of applications that were previously impossible to build. One of the first cases of use that is emerging at high speed today are decentralized financial applications. This gives you the possibility to take loans, trade, lend money, and much more, without going through an intermediary.
Taking advantage of the constraints on Bitcoin in terms of smart-contract creation, Ethereum offers an alternative that is of great interest to the business world, with flexible and adapted value propositions. Today, there is an alliance of Ethereum companies, which includes names such as Microsoft, Samsung or Intel and which are looking to test and develop the technology: the number of ethereum projects is booming.