Ethereum is an open, public, distributed blockchain platform and operating system with smart contract function (scripts). He supports a modified version of the Nakamoto consensus through transaction-based activities.
Along with Bitcoin, Ethereum is considered one of the major platforms in the field of distributed books and blockchain technology. The term Ethereum is often used interchangeably with the term Ether, denoting a cryptocurrency created on the platform. ETH can be transferred between accounts and used to compensate for the calculations made by the mining nodes of participants.
The Ethereum Virtual Machine (EVM) runs scripts in an international network of public nodes. «Gas» internal transaction pricing mechanism is used to limit spam and distribution of resources in the network.
ETH – History
The Ethereum platform was created at the end of 2013. The founder is the world famous today Vitalik Buterin. He advocated the creation of a new cryptocurrency on the grounds that Bitcoin needed its own programming language to create new projects. The current course of Ethereum allows us to speak about it as one of the most important digital currencies in the world.
He therefore proposed the creation of an improved platform. When the project was publicly announced in early 2014, key members of the Ethereum team were Vitalik Buterin, Mihai Alicia, Anthony DiJorio and Charles Hoskinson. The platform was launched in the summer of 2015. In total, 11.9 million coins were sold to the community. In 2016, Ethereum was split into two blockchains, the regular and the Classic.
Key Features of Ethereum
Ether is a cryptocurrency that provides a public transaction book. ETH is used to pay for the computing unit used in transactions and other state transitions, as well as for transaction fees and computing services on the Ethereum network. As with other cryptocurrencies, the authenticity of each ETH is ensured by a blockchain. This is an ever-growing list of records called blocks that are interconnected. Blockchains are inherently resistant to data modification.
Unlike ethereum to bitcoin, Ethereum uses accounts and balances in a way called state transition. It does not rely on Lost Transactions Output (UTXO) as the status includes current balances on all accounts and additional data. So it’s not in a blockchain, it’s in a separate branch.
How much does Ethereum cost?
In 2017, the value of the Ethereum currency increased by more than 13 percent, and the total offer of ETH in January 2018 was 98 million. In 2017, mining produced 9.2 million new ETH units, which corresponds to a 10% increase in its total offer. The Casper FFG and CBC protocols used by Ethereum are expected to reduce inflation from 0.5% to 2%. There are no restrictions on the overall ETH supply.
Transaction fees for ETH are usually much lower than for BTC. In December 2017, the median transaction fee for Ether was $0.33 and for Bitcoin $23.
ETH – what else do you need to know?
Ethereum differs from Bitcoin in many other ways. The blockchain time is 14-15 seconds. Ethereum uses a system of accounts where values are directly debited and assigned to other users, unlike the Bitcoin UTXO system. Both systems have advantages and disadvantages, primarily in terms of memory capacity and complexity, as well as security and anonymity.