This post was most recently updated on December 5th, 2018
Ethereum and Smart Contracts for Beginners
In this article, you’ll learn what is the ethereum but first, et talk a little bit about Bitcoin so we can see the difference between them.
Bitcoin was created in 2008 by Satoshi Nakamoto (we don’t know who he is) and the great thing about Bitcoin is nobody owns it, it is a decentralized technology that is online without CEO-s, CTO-s etc. There are just developers and core teams around the world that are working on the Bitcoin protocol together to expand the technology.
Bitcoin is really really good at storing value it has the same immutable ledger since eight years ago.
What is Ethereum?
Ethereum similar to bitcoins is a mineable coin was founded by Vitalik Buterin a couple of years ago. Vitalik was working with the Bitcoin magazine and basically, he saw an opportunity to expand the original blockchain technology that was Bitcoin into Ethereum.
So what Ethereum is? First of all, it’s a complete different blockchain and has his own currency which is called ether. On this blockchain, the developers can be built smart contracts.
So what are smart contracts?
Smart contracts are kind of digital code that you can implement online to execute certain functions that you need. For example, call it a virtual vending machine and I put on an escrow and put a certain rule in escrow meaning that when certain people register their five votes into this escrow automatically that escrow will open up and send five people this cryptocurrency “ether”. So it’s the same thing as a vending machine where I put in a dollar I press a code that code executes a trigger, that trigger in all spins on a different candy bar for me and I get it.
Another great thing about ethereum is decentralized apps. Think about it like a system with like Linux or kind of like Microsoft where people would build on top of that software. So the ethereum blockchain is the base protocol and applications are built on top of that protocol.
So let say ethereum is more flexible than Bitcoin it has more developers than Bitcoin. While Bitcoin is considered digital gold Ethereum is trying to be a true software company where other software developers and startups can build on top of it. You need small amounts of ether to run as gas so without small amounts of ether, you can’t execute the contracts a smart contract. that I talked about so let’s all
Ethereum it’s considered the world’s computer. However, we have seen network congestion when an app got popular like “Cryptokitties” and gas price got expensive and transactions got delayed.
There are a lot of differences between Bitcoin and Ethereum but also a lot of similarities.
Ethereum wouldn’t be here if it wasn’t for Bitcoin and actually all the blockchain teams wouldn’t be here if it was for Bitcoin. Bitcoin opens the door for everything we see today in the cryptocurrency world.
Recently people are losing trust and faith in Bitcoin. I love Bitcoin, I still have a bunch of them and I’m never going to let them go on. I don’t consider myself a Bitcoin maximalist but I think it’s going to be around for a much longer time.
If you’re new to Ethereum get yourself an ethereum wallet.
If you are wondering how to buy ethereum you can try Coinbase or Kraken which is a good exchange.
Subscribe To our Newsletter
And receive the Bitcoin Whitepaper Poster