With the invention of the blockchain technology came the invention of cryptocurrencies and the first and the most popular one is Bitcoin. Such a creation soon saw the coming of the other cryptocurrencies and similar platforms that were supposed to be better, more convenient, secure and available to the users. Like with everything else, it took some time to make it usable and perfect and the more the developers perfected it, the more features and options it gave to the users.
One of such perfected cryptocurrencies is Ethereum but there’s a catch here. People often tend to misunderstand it for being just another cryptocurrency and they are not far from the truth only it’s a bit different. While it does borrow a bit from Bitcoin it isn’t only focused on digital currency but rather on computing power. To be more precise, Ethereum is supposed to be the world’s largest computer and it’s a decentralized platform where smart contracts are run and executed.
The easiest way to understand what it is would be by understanding how the Internet works. The Internet is all about cloud services today as every time. It gets enhanced it offers a few more conveniences to the users. All our data today is being stored in servers and clouds and submit our data to them. The only problem is all that data is easily accessible by the third party who can use it against the users who have submitted it.
That means government services but also hackers. All your data becomes vulnerable to cyber attacks, theft and leaks. That is why the Internet became more centralized. To protect its users from those vulnerabilities but that gave an opportunity. To the most powerful companies to overtake the Internet.
The idea is to make the Internet more like the previous idea
People realized that it’s time to take the power back. And they have come up with new tools that will help them to decentralize the net. Thus, Ehtereum was born. Just like Bitcoin is taking the financial industry by storm. The same goes for the Internet and Ethereum by replacing internet third parties. To get a bit deeper into understanding what Ethereum is, it’s important to mention that it was built on the blockchain technology just like Bitcoin but with a single difference.
While Bitcoin allows the money transfer between two persons. Ethereum is that money and that digital money has a property of being highly programmable. That gives it more conveniences the users can experience while making their transfers. That brings us to smart contracts. Being the essential Ethereum network units, smart contracts serve as instructions written in a programming language where each step of the contract depends upon the execution of the previous one.
The chain continues until it reaches the end. Any misuse, fraud or cyber attack is completely useless because every set of instruction is absolutely protected. Since the entire process is completely automatic, it’s the best way of doing transactions online.