Technology is truly and madly unruly. First, it whips up an appetite for an immortal idea and then, almost immediately threatens its extinction. Something similar is happening with Ethereum- Vitalik Buterin’s answer to Blockchain.
It all started in 2009 when an unknown entity called Satoshi Nakamoto created a cryptocurrency and an electronic payment system called Bitcoin and released it as an open-source software to enable peer-to-peer transactions.
Bitcoins were virtual value tokens, unaffiliated with any nation. So, anyone could open an online wallet and receive Bitcoins without providing any identifying information. The transactions is recorded on a universal ledger or database referred as the Blockchain because, “all the activities are sorted into “blocks,” and each block is chained to the ones before it, all the way back to the very first transaction — a structure that made it tough for anyone to change the records.”
Truly the first-ever moment for business on the internet, Bitcoin offered a transparent digital medium for value access. Stocks, bonds, money, digital property, titles, deeds, even things like identity and votes can now moved, stored and managed securely –with complete immutability, security and absolute privacy.
Predictably, Blockchain became the buzzword of choice with reactions ranging from intelligent and exploratory to warnings and total incomprehension.
Predictably, Bitcoin’s bumpy ride from laud to lament was equally quick. And like all good things tech, it was soon challenged by the Canadian math prodigy, coder, and crypto-currency researcher Vitalik Buterin and Ethereum- an application that used the Blockchain platform for delivering just a little more took center stage. And how!
An open software platform, Ethereum is based on Blockchain technology but it now enabled developers to build and deploy decentralized applications as opposed to one new Blockchain for each new application.
The Ethereum Virtual Machine (EVM) was a Turing complete software that can run on the Ethereum network and enable anyone to run any program, regardless of the programming language given enough time and memory.
The most exciting feature of Ethereum? It could create binding financial agreements entirely implemented using the software without human or legal intervention! And once the program starts, it will be running without interference – aptly named as “Smart Contracts”.
The Bitcoin equivalent here is Ether- the value token of the Ethereum Blockchain, listed as ETH and traded on the cryptocurrency exchanges. It is also use to pay for transaction fees and computational services on the Ethereum network and held in an Ethereum Wallet.
With Smart Contracts, one could now create a virtual decentralized autonomous organization. (And yes, it creates – DAO raises an impressive $150 million! From Ethereum enthusiasts).
It also opened multiple app possibilities -censorship-free social networks, public utility ride-hailing apps, crowd-sourced prediction markets to online investment firms.
But that was not all. Ethereum offered significant advantages too.
Today Ether has a market value of $50.59 with a market capitalization of $4,469,204,016. JPMorgan, IBM, Microsoft, and Intel have already initiated exploratory projects based on this technology.
Samsung and IBM recently launched a project to coordinate Internet-connected devices, like washing machines and light bulbs, over an Ethereum-based network.
And Banks like Well Fargo, Barclays and Credit Suisse have launched pilot programs using the secured contract option.
Early days, one would say for this virtual idea that’s about to usher in crypto-economic democracy and transparent governance. Not impossible though if one were to share Vitalik’s optimism -“Building this future is an enormous task, but one can’t have it any other way.”
The easiest way is to use its native Mist browser -a user-friendly interface & digital wallet for users to trade & store Ether as well as write, manage, deploy and use smart contracts.