Ethereum has been developed in 2015 by Vitalik Buterin. This is a platform with a protocol making possible the creation of smart-contracts. Ethereum is like a big public and secured computer, and everybody can code and implement his own programs. It made possible the creation of decentralised applications, which restore the user as central ‘within the game’.
Ethereum : the origin of the smart contracts
First thing to know about Ethereum : his main purpose is not to be a currency. It is a platform for creating decentralised appliations (dApps). A dApp has a lot of strenghts because it is censorship resistant, tamper-proof and does not allow a single entity to own all the databases.
What you buy and sell on market is called Ether
As for Bitcoin, mining is the creation process of Ethereum. Ether (ETH) is the currency which serve as gas on the Ethereum blockchain. Ethers are received as a reward when a transactions block is validated, then used as ”fuel” on the network. Ethers have a real useful value for dApps developers, because it is essential to make programs working properly, and also used as a rating process for smart contracts operations.
Ethers total supply is not capped
It is an important difference with Bitcoin. But a fixed number if Ethers is created every 15 seconds, which controls inflation because the pourcentage of Ethers created among the total supply will decrease over time.
Smart contracts are revolutionary for corporates
The smart contract is the main innovation brought by the Ethereum blockchain. Coding some actions and programing their automatic and conditional execution is now possible. To understand, let’s take the example of a flight-delay insurance. The contract stipulate you will have a full refund if the flight has a delay superior to three hours. If such a situation occurs, the smart-contract registered in the Ethereum blockchain is able to check delays and automatically proceed to your refund, in Ethers. This technology avoids a lot of administrative steps, third-parties intervention and a faster, trusted and secured refund process.
The platform which makes ICO possible
ICOs are a new way to raise funds, based on a peer-to-peer aspect. ICOs allow project financements for smart contracts and dApps developments. A lot of these projects use the Ethereum blockchain. ERC-20 token is, for example, a standard from the Ethereum blockchain which guarantee that a project has been developed following specific rules. That’s why Ethereum is the essence of most port of the ICOs.