The revolutionary blockchain technology has, in recent times, begun to be used for much more than digital currency such as Bitcoin. Although it seems to be commonly associated with this, today Bitcoin is only one of the several hundred applications that utilize blockchain technology.
Only people with intellectual backgrounds in cryptography, coding and mathematics, and with a significant amount of resources at their disposal, have previously managed to utilize blockchain technology. But this has changed because of Ethereum.
Ethereum provides developers with the tools to build decentralized applications. It is enabling previously unimaginable applications, from electronic voting to regulatory compliance & trading, to be built and deployed at a fascinating speed.
What is Ethereum?
Put simply, Ethereum is an open software platform that enables decentralized applications to function by utilizing block-chain technology. It has drastically increased options for developers.
Ethereum is like Bitcoin as in the sense of being a distributed blockchain network. They differ mainly in motive and aptitude.
Bitcoin is primarily a currency; it offers a peer to peer electronic cash system. It enables Bitcoin payments; it merely tracks ownership of these ‘Bitcoins’, i.e., digital currency.
On the other hand, users of Ethereum are usually Ethereum cloud mining for ‘Ether’, a sort of crypto token that fuels the network. Ethereum cryptocurrency can be used by application developers to pay for transaction fees and services on the network. This means that Ethereum focuses primarily on running programming code for decentralized applications.
The uses of Ethereum:
The Ethereum market enables developers to build and deploy decentralized applications. These applications are not controlled by any individual or central entity since their code is run on the blockchain network.
Ethereum has been designed to build DAOs (Decentralized Autonomous Organizations). These are fully autonomous, decentralized organization, meaning they have no single leader. DAOs run on programmed code – a collection of smart contracts written on the Ethereum blockchain.
This code can be used in order to revolutionize traditional rules and structure of organizations, eliminating the possibility of people having centralized control. A DAO can be owned by anyone who can purchase a token, but instead of each token being used to represent equity shares & ownership; tokens have evolved into contributions that empower people with voting rights.
Decentralized applications can redeem the manifold benefits of running on block-chain. Applications are now corruption and tamper proof, immutable, secure and have no downtime.
Also published on Medium.