Presentation and definition of the Ethereum cryptocurrency (ETH)

How does Ethereum work?

Ethereum is a network of computers that allows you to create a new type of applications. It is indeed a network of ultra-secure computers that are found around the world. This means that the information sent and received by this application is no longer processed by a server, but by this network of computers, in which each computer performs a small part of the work.

In exchange for this work, the members of this network receive ethers. Ethers are the fuel that allows applications to work. If a user does not need ethers, he can resell them to application developers. This will allow application developers to have fuel for the operation of their applications so that users can monetize their work.

Ethereum is a huge network of several thousand computers on which several applications run. This is called decentralization of applications. For a secure and transparent operation, this network operates using the principle of the blockchain: it is a large register on which the lines are automatically filled one by one by the different participants of the network. However, on this blockchain, it is impossible to delete or modify an already existing line. The information that appears on the blockchain is called smart contracts.

The advantages of the blockchain for Ethereum

Using the blockchain for its decentralization brings several advantages to the Ethereum:

• The blockchain is public, which allows all users to be informed of all transactions that take place. Moreover, it is impossible to modify this blockchain, so that one can consult all the transactions that have taken place since its creation.
• This also protects against any risk of data corruption. Indeed, since all participants have a copy of the database, it is almost impossible to corrupt their data.
• The blockchain works with an encrypted protocol that is also almost impossible to hack.
• Given the size of the network, computers will still be available to power it. This allows it to offer a very high reliability.

The utility of Ethereum

As we have already seen, ethers can not only be used as a fuel for the operation of applications, but they can also be resold to developers who need them. However, they can also be used on various applications, being spent as real money. Taking the example of an online betting application that accepts ethers, you can then use the ethers to bet the same way as with money. However, instead of earning money, you will earn ether.

The Ethereum platform: what is it?

Ethereum is a platform for decentralized exchanges. Just like Bitcoin, the protocol relies on blockchain technology but is not limited to monetary transactions only: it allows to create all types of applications (dApps) in a decentralized way. Basically, Ethereum is not a direct competitor of Bitcoin since it proposes a different use of the blockchain and brings additional functionalities.

Exchanges without intermediaries

The smarts contracts

The goal of the Ethereum network is to remove any type of intermediary on the web. It allows to program contracts, which are called by the creators of the network of "smart contracts", simple or complex, whose payment will be triggered only if all the conditions initially programmed are fulfilled. These contracts make it possible, for example, to carry out a financial transaction between two companies without the intervention of a third party.

Advantages

These stand-alone programs have the advantage of having a reduced cost to seal a contract and to allow a fast execution. In addition, formalizing commitments through the blockchain ensures the immutability of the terms defined at the outset.

Ether, the "fuel" of dApps

The whole protocol works thanks to a crypto-currency, Ether, which is used to pay for smart contracts by buying "gas". This famous gas can be likened to a fuel that would allow the use of dApps in the same way that gasoline is used for his car. If there is no more "gas", the contract is no longer active.

What you must remember

Ethereum is a network of computers that makes applications work in a new way, using the power of thousands of computers that connect around the world.

This network is totally secure and transparent thanks to the use of a blockchain.

By contributing to the network you will earn ethers, which you can use to run applications, use in an application or resell to interested people.