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Ethereum Explanation

How Ethereum Works - Coindesk

How Ethereum Works - Coindesk

CoinDesk Launches 2017 Year in Review Opinion and Analysis Series Now that we've covered what ethereum is, let's dive deeper into how the platform functions under the hood. Consider the online notebook application described in " What is Ethereum? " Using ethereum, the appdoesn't require one entityto store and control its data. To accomplish this, ethereum borrows heavily from bitcoin's protocol and its blockchain design, but tweaks it to support applications beyond money. Ethereum aims to abstract away bitcoin's design, however, so that developers can create applications or agreements that have additional steps, new rules of ownership, alternative transaction formats or different ways to transfer state. The goal of ethereum's 'Turing-complete' programming language is to allow developers to write more programs in which blockchain transactions could govern and automate specific outcomes. This flexibility is perhaps ethereum's primary innovation, as explained in the guide " How Ethereum Smart Contracts Work ". The structure of the ethereum blockchain is very similar to bitcoin's, in that it is a shared record of the entire transaction history. Every node on the network stores a copy of this history. The big difference withethereum is that its nodes store the most recent state of each smart contract, in addition to all of the ether transactions. (This is much more complicated than described, but the text below should help you get your feet wet.) For each ethereum application, the network needs to keep track of the 'state', or the current information of all of these applications, including each user's balance, all the smart contract code and where it's all stored. Bitcoin uses unspent transaction outputs to track who has how muchbitcoin. While it sounds more complex, the id Continue reading >>

R/ethereum - I Wrote This To Explain Ethereum In Depth To Newbies. Please Check For Accuracy! : Ethereum

R/ethereum - I Wrote This To Explain Ethereum In Depth To Newbies. Please Check For Accuracy! : Ethereum

r/Ethereum - I wrote this to explain Ethereum in depth to newbies. Please check for accuracy! Hello r/ethereum - I'm currently in Singapore exploring all of the cool blockchain tech that's going on here. I'm also writing a blog that aims to explain blockchain technology simply to anyone whose interested. www.cryptoambit.com If you guys could spot check my Ethereum post for accuracy, I'd appreciate it. If you like it, would also appreciate some subscribers! Thanks By now, most people know Ethereum as the second most valuable cryptocurrency, currently valued at over $60 billion dollars. Well, it turns out that Ethereum isn't actually a cryptocurrency - it's a software platform that let's programmers build applications on top of blockchain technology. Within the ethereum platform, is a cryptocurrency called ether that is used to power applications built on the Ethereum blockchain. Bitcoin uses a global network of computers that maintain a shared ledger called a blockchain that keeps track of who owns bitcoin. Once blockchain technology was introduced to the world, people realized that blockchains could be used to keep track of anything of value. In 2013, a 19 year old named Vitalik Buterin introduced the Ethereum white paper, which proposed an open source platform that would let programmers build blockchain applications that could facilitate the exchange of money, content, property, shares or anything of value. Much like with Satoshi Nakamoto's paper, Buterin's was met with widespread excitement from software developers around the world who began building toward the vision Buterin laid laid out. Much like Bitcoin, Ethereum isn't owned or controlled by any one person. Unlike Bitcoin, whose creator remains anonymous, Ethereum has a leader in Vitalik Buterin (pictured below) Continue reading >>

How Does Ethereum Work,anyway?

How Does Ethereum Work,anyway?

Odds are youve heard about the Ethereum blockchain, whether or not you know what it is. Its been in the news a lot lately, including the cover of some major magazines, but reading those articles can be like gibberish if you dont have a foundation for what exactly Ethereum is. So what is it? In essence, a public database that keeps a permanent record of digital transactions. Importantly, this database doesnt require any central authority to maintain and secure it. Instead it operates as a trustless transactional system a framework in which individuals can make peer-to-peer transactions without needing to trust a third party OR one another. Still confused? Thats where this post comes in. My aim is to explain how Ethereum functions at a technical level, without complex math or scary-looking formulas. Even if youre not a programmer, I hope youll walk away with at least better grasp of the tech. If some parts are too technical and difficult to grok, thats totally fine! Theres really no need to understand every little detail. I recommend just focusing on understanding things at a broad level. Many of the topics covered in this post are a breakdown of the concepts discussed in the yellow paper. Ive added my own explanations and diagrams to make understanding Ethereum easier. Those brave enough to take on the technical challenge can also read the Ethereum yellow paper. A blockchain is a cryptographically secure transactional singleton machine with shared-state. [1] Thats a mouthful, isnt it? Lets break it down. Cryptographically secure means that the creation of digital currency is secured by complex mathematical algorithms that are obscenely hard to break. Think of a firewall of sorts. They make it nearly impossible to cheat the system (e.g. create fake transactions, erase tr Continue reading >>

Whats The Difference Between Bitcoin And Ethereum?a Simple Explanation

Whats The Difference Between Bitcoin And Ethereum?a Simple Explanation

Whats the difference between bitcoin and ethereum? A simple explanation By Michelle Tam, Marketing Intern (Summer 2017) Since 2009, bitcoin has always been dominating the crypto-technology space; but it is certainly not the only major player. Ethereum was launched in 2015 and is the second largest crypto-platform after bitcoin. Each has attracted a lot of hype due to their promising features and applications. When deciding on whether to engage with the bitcoin or ethereum ecosystems, it is important to understand the characteristics that differentiate the two. Bitcoin a decentralized digitalcurrency While people often make comparisons between ethereum and bitcoin, the reality is that they are fundamentally different. Bitcoin was designed to act as a peer to peer decentralized currency for the internet age and has now been formally recognized by some governments as a virtual payments system or digital currency. Individuals can use bitcoin to buy a wide variety of goods or services and the number of merchants accepting bitcoin is growing rapidly. Bitcoin is also gaining increased popularity as a secure store of value. Ethereum a decentralized computing platform Ethereum was designed to be more than a cryptocurrency. It is a decentralized computing platform which enables its users to program different types of smart contracts which are stored and run on its network, and fueled by its own cryptocurrency called ether. Unlike bitcoin, ether is not intended to be used as a digital currency for commerce but as a platform-based currency that is used only within the ethereum network. Decentralized applications or dapps, which are built around smart contracts and run on the ethereum network are open source and rely on disintermediation. This means that two dapp users can be conne Continue reading >>

Understanding Ethereuma Fullguide

Understanding Ethereuma Fullguide

Interested in the challenges between blockchains and the law founder of www.lawandblockchain.eu Ethereum is the subject of a lot of hype lately. It is praised by some as the new internet or the worlds computer and criticised by others as a platform that enables widespread scams and ponzi schemes to thrive. I see badly informed articles about Ethereum, smart contracts, DApps, DAOs, ICOs and tokens on the daily so it is time to analyse the subject. I will present the argument that Ethereum might form the main protocol enabling the internet of value. It is time to take a closer look at what Ethereum is, what it enables and what role it could play in the future. But first, we have to backtrack a bit. Time for a small reminder about the value of distributed ledger technologies. To put it briefly, a blockchain is a database that is secured and maintained by a large number of nodes worldwide. Data is stored in blocks, which are time-stamped and linked to each other to form a chain. The blockchain makes sure that all data stored in the chain is secure and immutable forever, which is what makes the blockchain so interesting. Through its consensus mechanism, the blockchain is trustless , which means that one does not have to rely on the trustworthiness of a counterparty. For the first time, the blockchain enabled a safe way to send value on the internet without needing a trusted third party. This led to the rise of Bitcoin and other cryptocurrencies. In essence, a Bitcoin transaction is just the execution of a piece of code stating that person A sent X amount of Bitcoin to person B. This transaction is self-enforcing. To execute, it first checks if there is enough Bitcoin in person As digital wallet and then sends the money to Bs wallet. In itself, this transaction is a piece of Continue reading >>

A Simple Explanation For Ethereum Starts With Understanding Blockchain And Bitcoin

A Simple Explanation For Ethereum Starts With Understanding Blockchain And Bitcoin

Well teach you profitable strategies, help you get the best tools for trading and warn you against scam. Is there a simple explanation for Ethereum? In this post, I will endeavor my best to explain Ethereum in a simple and straightforward manner. The aim is to understand Ethereum even if this is the first time you have come across the terms and just got curious about it. To get a simple explanation for Ethereum, you first need to have a little background about Bitcoin and Blockchain. Both are buzz words that are frequently thrown together in the melting pot with Ethereum. So let us get to the basics. A Simple Explanation for Ethereum starts with Understanding Blockchain and Bitcoin One fine morning in 2008 the mysterious Satoshi Nakamoto had this fantastic dream of setting up a safe and secure Peer to Peer system of payments that would eliminate all the terrible third parties from the equation. (Apologies to banks, financial institutions, and PayPal). This disruptive system of effecting payments would work on an underlying technology what is known as Blockchain. Blockchain is a decentralized system whereby CFOs, CEOs, CMOs and all that jazz do not exist. It is a system that belongs to everyone and records transactions securely. The Blockchain system is run by miners who acquire immutable proof that a transaction has been affected and confirm it by proof of work. This means that once they verify that a transaction has actually been done, they update all the nodes in every computer to verify that this transaction actually happened. In turn, a miner receives a fraction of Bitcoin as payment for his work. The update creates a new block on the chain. Therefore, Bitcoin aims at disrupting all types of online banking systems and provides a secure and safe way of transferring Continue reading >>

Everything Youve Ever Wanted To Know About Ethereum, Patiently Explained

Everything Youve Ever Wanted To Know About Ethereum, Patiently Explained

Everything youve ever wanted to know about Ethereum, patiently explained Although Bitcoin and Ethereum are terms that are often paired together, the reality is that they are vastly different.The only thing Ethereum shares with Bitcoin is that its a cryptoasset running on top of blockchain. Instead of being just a cryptocurrency, like Bitcoin, Ethereum also has features which effectively makes it a huge decentralized computer. To understand Ethereum , one must understand how blockchain works. If you already understand it, or have already read my ultimate guide to understand blockchain , feel free to go directly to the next section. A blockchain, simply put, is a database. Its an ever growing database of certain kind of data and has quite remarkable properties: Once data is stored in the database, it can never be modified or deleted. Every record on a blockchain is permanent for eternity. No single individual or organization maintains the database; several thousand individuals do, and everyone has a copy of the database with themselves. To understand how several people are able to keep their copies of the database in sync with everyone else, imagine there are ten individuals in a network. Everyone is sitting with an empty file folder and an empty page in front of them. Whenever anyone does something important in the network, like transferring money, they announce it to everyone in the network. Everyone makes a note of the announcement on their pages until the page is filled. When it does, everyone has to seal the contents of the page by solving a mathematical puzzle. Solving the mathematical puzzle ensures that everyones page had same contents and that they can never be modified. Whoever does it first, gets rewarded with some amount of cryptocurrency. Note: Want to know Continue reading >>

What Is Ethereum, In Layman's Term?

What Is Ethereum, In Layman's Term?

When we use our computers and use Word docs or other files we normally save them in folders. A folder with docs, photos, spreadsheets, music files, other files, etc. could be called our database. When we use Facebook, for example, we don't keep that "database" of photos, status reports, messages, links, etc in our computer, Facebook keeps a database of all our activities on their servers in a data-center, which is a building full of servers (powerful computers). In the case of Bitcoin instead of using Facebook, or any other service, to store our stuff in their databases, we download a software that is more or less like Skype, and instead of sending and receiving voice or video or text between us we send and receive units called bitcoins. The Bitcoin software (Bitcoin Core) instead of centralizing "the database" in a service like Facebook or Google or Dropbox, it keeps a copy of the database on your laptop or PC. Imagine 10 friends at a bar around a table and everybody with a laptop and a copy of Bitcoin. Each laptop has the complete database of the Bitcoin list of accounts and transactions. When friend A sends 1 bitcoin to friend B it sends the message to all 10 laptops and they all check that the balance is correct, the accounts, etc. and after checking (and doing some other calculations) they all agree to post, on the databases that they all have in their disks, the new transaction. The Bitcoin database is called a blockchain, because of how it operates, and the process by which all computers check transactions and reach an agreement is called "consensus" (there is another process called mining, but I think it's not relevant in a layman's explanation). The world changing invention of Bitcoin is that all computers participating in the network can keep this "distribute Continue reading >>

What Is Ethereum? A Step-by-step Beginners Guide

What Is Ethereum? A Step-by-step Beginners Guide

If you want to know what is Ethereum and how it works and what it can be used for, without going deep into the technical abyss, this guide is perfect for you. Important Note: This guide assumes a basic understanding of blockchain technology. If youre unfamiliar with blockchain, check out this step by step introduction for beginners . Beyond Bitcoin & first generation decentralized applications Although commonly associated with Bitcoin , blockchain technology has many other applications that go way beyond digital currencies. In fact, Bitcoin is only one of several hundred applications that use blockchain technology today. [Blockchain] is to Bitcoin, what the internet is to email. A big electronic system, on top of which you can build applications. Currency is just one. Sally Davies, FT Technology Reporter Until relatively recently, building blockchain applications has required a complex background in coding, cryptography, mathematics as well as significant resources. But times have changed. Previously unimagined applications, from electronic voting & digitally recorded property assets to regulatory compliance & trading are now actively being developed and deployed faster than ever before. By providing developers with the tools to build decentralized applications, Ethereum is making all of this possible. At its simplest, Ethereum is an open software platform based on blockchain technology that enables developers to build and deploy decentralized applications. Is Ethereum similar to Bitcoin? Well, sort of, but not really. Like Bitcoin , Ethereum is a distributed public blockchain network. Although there are some significant technical differences between the two, the most important distinction to note is that Bitcoin and Ethereum differ substantially in purpose and capabil Continue reading >>

What Is Ethereum? Everything You Need To Know About Ethereum, Explained

What Is Ethereum? Everything You Need To Know About Ethereum, Explained

What is Ethereum? Everything You Need to Know About Ethereum, Explained At its most basic, Ethereum is an open-source software platform based on blockchain technology. This platform enables developers to build and deploy decentralized applications (dapps) like Status or Metamask on it. All of this is possible because of a breakthrough in blockchain technology (as popularized by Bitcoin), and then Ethereum came along with some new ideas. As the two biggest cryptocurrencies (by market cap), Bitcoin and Ethereum often get mentioned in the same sentence. For the uninitiated, understanding what Ethereum is and how it differs from Bitcoin can be difficult. On the official website under the tagline build unstoppable applications, you will find the following description of Ethereum: A decentralized platform that runs smart contracts: applications that run exactly as programmed without any possibility of downtime, censorship, fraud or third-party interference. Another common description of Ethereum is that its intended to become a world computer. If none of the above makes complete sense to you, dont worry, thats the purpose of this article. Think of this as Ethereum 101, wherein we answer all the most important Ethereum-related questions, chart its history, provide some technical explanations, discuss pros & cons, and lay out what the future might look like. If youre completely new to cryptocurrency, it may be useful to get acquainted with some essential cryptocurrency terms first. As a starting point, lets think of Ethereum as Bitcoins multi-talented, more versatile younger sibling. Lets go! Ethereum started with one person, and that person is Vitalik Buterin . Unlike Bitcoin, Ethereum has a real name attached to it, a leader if you will. Buterin is a Russian-Canadian program Continue reading >>

Ethereum Definition | Investopedia

Ethereum Definition | Investopedia

Launched in 2015, Ethereum is a decentralized software platform that enables SmartContracts and Distributed Applications (Apps) to be built and run without any downtime, fraud, control or interference from a third party. Ethereum is not just a platform but also a programming language (Turing complete) running on a blockchain, helping developers to build and publish distributed applications. The potential applications of Ethereum are wide ranging. The applications on Ethereum are run on its platform-specific cryptographic token, ether. During 2014, Ethereum had launched a pre-sale for ether which had received an overwhelming response. Ether is like a vehicle for moving around on the Ethereum platform, and is sought by mostly developers looking to develop and run applications inside Ethereum. Ether is used broadly for two purposes, it is traded as a digital currency exchange like other cryptocurrencies and is used inside Ethereum to run applications and even to monetize work. The current market cap of ether (ETH) is now more than Ripple and Litecoin although its far behind bitcoin (BTC). According to Ethereum, it can be used to codify, decentralize, secure and trade just about anything. One of the big projects around Ethereum is Microsofts partnership with ConsenSys which offers Ethereum Blockchain as a Service (EBaaS) on Microsoft Azure so Enterprise clients and developers can have a single click cloud based blockchain developer environment. Continue reading >>

What Is A Very Simple Explanation Of Ethereum?

What Is A Very Simple Explanation Of Ethereum?

What is a very simple explanation of Ethereum? If youre using them in read-only mode its free If youre writing data it costs some amuont of money Lets take Instagram as an analogy and imaging its built on Ethereum Liking a photo, following, etc would cost you a negligible amount of money (much less than a cent) Uploading a photo would cost you more, cause you would pay for storage costs. Now Instagram covers that, but you pay with your privacy If you get the description of Lambda and do :%s/Lambda/Ethereum/g youll get a pretty good explanation: Ethereum lets you run code without provisioning or managing servers. You pay only for the compute time you consume - there is no charge when your code is not running. With Ethereum, you can run code for virtually any type of application or backend service - all with zero administration. Just upload your code and Ethereum takes care of everything required to run and scale your code with high availability. You can set up your code to automatically trigger from other Ethereum services or call it directly from any web or mobile app. Here is a simple, but long and detailed explanation :) Bitcoin makes you spend your money without any intermediary; in my opinion its core is no one can stop you to spend your own money. Ethereum has a similar philosophy. But its focus is a program (code), rather than money. Ethereums core is Once you write a code on Ethereum, no one can stop your code execution. In here, you can write your code with no restrictions & limits (aka its language is Turing complete). Ethereum is not the first one using programing languages in blockchain technology. Bitcoin has been using programing language. For each transaction in Bitcoin, a script is being executed. Every node runs scripts for all their controls. When Bitc Continue reading >>

Explain Ethereum Like I'm Five

Explain Ethereum Like I'm Five

It took me a few hours of solid research to understand blockchain. I know the question is about Ethereum, but I'll explain Bitcoin here and hopefully that will get you most of the way. Imagine that you want to buy your little sister's toy truck. Your parents give you a monthly allowance, but not in cash -- they tell you how much money you've been allotted and allow you to request cash from your balance whenever you need it to buy something. You want to spend $5 of your allowance to buy the toy truck, but your little sister would just add the money to her own allowance, so there's no point dealing in cash. You decide to create a transaction record: you write out the amount of money you're giving her and what she's giving you in return on a piece of paper. It's like a receipt at the store. You would each sign the transaction with your name, but you want this transaction to be secret so that your friends don't know you own the toy truck (they would want to borrow it all the time). So you sign with a big word that your sister doesn't know how to spell, and she signs with a big word that you don't know how to spell. It takes each of you so long to learn to spell new words that you aren't worried these signatures will be compromised. You take this paper to the copy machine and copy it once. This way you each have a record of the transaction. The next time she wants to spend her allowance, she can use the transaction record to get the $5. There's one problem left to solve: sibling rivalry. You don't want her to claim that she never got paid and the truck is still hers. And she doesn't want you to claim that she made up the transaction and you still have that $5. (Either of you could do this by pretending you can't spell the big word you signed with.) So you each take your cop Continue reading >>

Blockchain, Bitcoin And Ethereum Explained

Blockchain, Bitcoin And Ethereum Explained

Blockchain, Bitcoin And Ethereum Explained Opinions expressed by Forbes Contributors are their own. Despite hundreds of articles being written and discussions being had on this subject, can anyone truly say that they understand everything about blockchain, Bitcoin,and Ethereum? I spoke to Loi Luu, co-founder and CEO of KyberNetwork , a decentralized exchange that allows for the instant trading and conversion of any cryptocurrency. I asked this renowned cryptocurrency, smart contract security and distributed consensus algorithm researcher the questions most regularly asked about blockchain, as well as its impact on the fintech industry. Madhvi Mavadiya: In layman's terms, how would you describe blockchain's impact on the fintech industry? Loi Luu: Revolutionary, because it takes away the middleman to attain the same purposes in transactions. Traditionally, middlemen such as banks and other forms of financial institutions are needed to ensure that a payment goes through. However, these middlemen cost money, and as a result payment transactions become unnecessarily inefficient, bloated and expensive. Additionally, having middle men introduces potential security risks and financial fraud. Blockchain improves the efficiency of a transaction by eliminating the middlemen, and as a result, we could have a more efficient payment system, reducing the cost of money transfer for everyone. Blockchain also makes things more transparent and easily auditable by any third party. Mavadiya: How would you describe Ethereum's impact on fintech? Loi: Ethereum is the first generic blockchain platform that allows users to easily create and deploy their decentralized and trustless applications. It has created incredible opportunities in the fintech space. Its creation and adoption has allowed Continue reading >>

Blockchain - How Would I Explain Ethereum To A Non-technical Friend? - Ethereum Stack Exchange

Blockchain - How Would I Explain Ethereum To A Non-technical Friend? - Ethereum Stack Exchange

How would I explain Ethereum to a non-technical friend? I've recently attempted to explain Ethereum to several non-techy friends. My explanation usually involves starting with a comparison to Bitcoin, but this quickly becomes complicated as I then have to explain the backstory of how the Bitcoin blockchain works, which is similarly technical in nature. Is there a better way to describe the general concepts of Ethereum to non-techies? Are there any analogies I can make to things that are less technical in nature? Or is it just the case that the technology is quite complicated...? Ethereum is a world computer [ 1 ] and might change how we interact, just like the internet did, 20 years ago. Like Bitcoin, it is based on a block chain, but Ethereum is more than just a currency: Secure backbone for e-commerce and the Internet of Things Integrated development environment for debugging, development and deployment of Ethereum applications Free software - all released under the General Public Licence (GPL) The substantive content of your Answer was almost entirely in a linked video and therefore unavailable in this StackExchange. There was no attempt to summarize the salient points of the video. user75798 Jan 20 '16 at 21:25 Brilliant! I was having trouble to understand it myself Zorgatone Jan 21 '16 at 13:44 Many parts of Ethereum software are not released under the GPL. E.g. pyethereum , evmjit . Pawe Bylica Mar 9 '16 at 19:14 This answer isn't that sexy. For us who understand, it says everything. But for someone new: "Transparent, why is that cool? I expect all services to be secure. Paypal is secure and something license." Not being a hater in any way, just trying to find more of a elevator pitch which makes the other person go "Aha!" Jon Ramvi Aug 23 at 12:45 It depends on Continue reading >>

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