What is Ethereum and How to Buy It?
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Who doesn't know about Ethereum (for cryptocurrency players). But, did you know that Ethereum is not a cryptocurrency?
What Is Ethereum?
Ethereum is a software platform for programmers to build applications using blockchain technology. Ethereum is a blockchain platform with smart contract functionality. Ethereum has functions like a virtual machine that can run peer-to-peer smart contracts with the cryptocurrency Ether. Ethereum is a big project started by Vitalik Buterin in 2013.
Ethereum is the second largest cryptocurrency in the world after Bitcoin, and one of the busiest blockchains. This is because Ethereum is the pioneer of the smart contract platform, which is the basis for building various decentralized applications (dApps) as well as Web3. If you want to know more about what Ethereum is, read more about it in this article.
Who Made Ethereum?
The answer is Vitalik Buterin. Vitaly Dmitriyevich "Vitalik" Buterin born January 31, 1994 is a Canadian programmer and writer who is best known as one of the co-founders of Ethereum. He was involved from the very beginning of the concept of Ethereum, and co-founded Bitcoin Magazine in 2011.
Within the Ethereum platform, there is a cryptocurrency called Ether which is used to power applications built on the network.
Just like Bitcoin (BTC), Ethereum (ETH) is a decentralized system. This means that no person or company can control Ethereum. A centralized system has been used since ancient times. However, history has proven, sooner or later, that something that is centralized will be destroyed if it is not maintained properly.
On the other hand, something decentralized will still run automatically without a leader. Decentralized applications run on computers using the application all over the world, so these applications will never go offline. Something confidential such as KTP numbers, home addresses and names are still stored on each computer.
What is the difference between Bitcoin and Ethereum?
Ethereum and Bitcoin are almost the same when viewed from cryptocurrency aspects, such as being decentralized and using blockchain technology. However, in reality they have different goals.
Bitcoin used to be an online payment
Ethereum was created to help users create decentralized applications on the Ethereum network.
Bitcoin mining requires an enormous amount of computation and you also have to remember that electricity is very expensive in Indonesia compared to China or Russia. However, Ethereum uses a proof-of-work algorithm that supports decentralized mining by individual miners. In essence, adding to Ethereum is much easier than Bitcoin.
Who created Ethereum?
Vitalik Buterin is the one who came up with the idea for Ethereum. In 2013, he wrote a whitepaper on the genius idea. He also sent it to some of his friends and his friends shared it with many people. Keep in mind before writing about Ethereum, Vitalik loves the idea of Bitcoin and is active on Bitcoin forums. He is also paid to write articles about Bitcoin. About 30 people messaged Vitalik to discuss the concept.
The project was announced to the public in January 2014, with a core team consisting of Vitalik Buterin, Anthony Dilorio, Charles Hskinson, Gavin Wood, Mihai Alise and Joe Lubin. Vitalik also introduced Ethereum at the Bitcoin conference in Miami. The idea was warmly welcomed by many. A few months later the core team did a crowdsale/fundraising for Ether for more in-depth developments.
Is Ethereum a cryptocurrency?
Come on, let's study deeper. Ethereum is a software platform that aims to create a decentralized internet as well as decentralized applications. However, the system also requires a 'currency' to run the application. The 'currency' is Ether.
Ether is a digital asset that does not require a third party to process payments. It not only operates as digital money but also serves as 'gasoline' to run decentralized applications on the network. If the user wants to change or add something to the application, he will need to pay a fee for the Ethereum network to accept the changes.
Smart contracts
Projects built using Ethereum must use smart contracts. A smart contract is a digital agreement that is similar to the agreement you sign at a notary. Example: party A wants to pay rent for a house on the 10th to party B, on the D day, the Ethereum network automatically transfers the payment to party B. This is a very simple example.
If you are a programmer, smart contracts can be compared to if-then statements. In layman's terms, if this happens, work on it. Smart Contract is one avenue for future agreements. With a smart contract, you no longer need a notary or lawyer.
This smart contract is executed directly by the computer, the error is very small. However, smart contracts are written by humans. If there is a problem in writing, then the execution will also be problematic.
ICOs
Several years ago, Ethereum was well known for its Initial Public Offering (ICO). 80% of ICOs use the Ethereum network rather than Bitcoin or other altcoins. Now, many altcoins like Wave, Stellar, Tron and Eos will start their coin network based ICO.
Newcomers will stick with the Ethereum network as their network is stable. The Ethereum network makes it easy for businesses to build a decentralized business. If you check the whitepaper of an ICO, they will write with ERC-20 tokens, meaning that the ICO uses the Ethereum network.
Why use the Ethereum network? At that time, the Ethereum network was the only crypto that could build decentralized applications. Not only that, Ethereum is faster and cheaper than Bitcoin or Litecoin.
Far from perfection
Ethereum is not perfect because they are still in their 'infant' stage. I'm only 4 years old on this project. We can compare before 1GB MMC(memory card) was very expensive, around 1-2 million, now, the same thing is much cheaper. Same with Ethereum or you could say all cryptocurrencies and Blockchain technology.
People are still 'groping around' this new technology and it is certain that the technology will definitely be as common as smartphones.
Parity Wallet Freeze- Parity wallet crashed and $280 million worth of Ethereum was frozen. ETH here is not lost but cannot be used. DAO Hack- a hacker steals ETH due to a faulty code in the program. The hacker managed to steal $55 million worth of ETH into a private wallet.
Future
The future for the Ethereum network is very ugly. In fact, the price of ETH has fallen by 80% from 2018. The Ethereum team has been trying to fix issues such as scalability but to no avail.
Will ETH disappear from the crypto market? no one knows, but time will tell.
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