General information
Ethereum is a platform in which you can build, deploy, and use decentralized applications that don’t have a home on a single computer. They are just distributed across many computers that enables more trustworthy infrastructure. Therefore, you can avoid hosting software on server where they can control your entire activities and data. There’s no central entity who is keeping an eye, so users can control their data properly and privately.
Technical information
When we talk about the technicality of Ethereum Technology, we talk about the blockchain network on which it works. Blockchain is an evidence collection mechanism that makes changing, hacking, or cheating the system challenging or unable to do so. A blockchain is basically a digital transaction leader that is duplicated and replicated on the blockchain through the entire data network. There are multiple transactions per block of every chain and, each time a new transaction happens in the blockchain, each participant’s leader receives a record of the transaction. It is also called the Distributed Ledger Technology (DLT), where a decentralized database is managed by several members of the network and blockchain works on DLT. So, in blockchain, each transaction is registered with Hash. Hash is basically a cryptographic signature that is unchangeable. As each participant receives a record of each transaction, it makes it very hard for the hacker to corrupt a blockchain because he must change every block in the chain in all the distributed versions of the chain. Blockchain of Ethereum is constantly growing its security level as new blocks are being added rapidly.
There are several cryptocurrencies like Ether for example bitcoin or ripple, that work based on blockchain. However, all other cryptocurrencies limit its use of blockchain to the creation and distribution of its kind as a digital currency. Whereas Ethereum stands out by using blockchain and making it useful for programmers for the creation of their own applications based on blockchain.
Smart Contract
A basic contract has a set of guidelines or rules which makes sure that the involved parties execute the guidelines according to the terms and conditions of the agreed contract. Now let’s talk about how smart contracts work and Ethereum makes it better than the basic traditional paper contracts. Smart contract upholds guidelines designed as a computer code and initiated by two parties without involvement of any intermediary third party. These contracts often do not include judicial, but someone can, depending upon the requirements. These contracts are simple line of codes, making it transparent and unchangeable and even make it fully secured against tempering
These contracts can also be understood as business software where a programmer creates to run their developed applications. These applications are also known as Decentralized Applications (DApps) because they run on a decentralized network, that is Blockchain network.
Applications on Ethereum network must use or use a technology-specific cryptographic token, Ether. Like money is something which is used to trade between goods. Similarly, Ether is like money in the world of the Ethereum platform. Hence, Ether is used for 2 purposes:
- to trade as a digital cryptocurrency
- and to use it inside Ethereum Technology.
Historical information
Ethereum was introduced to the world of IT/programming on the 30th of July 2015. This was a result of a lot of different campaigns that gave way to the final product. The initial idea was proposed on paper by Russian Canadian programmer Vitalk Buterin. Buterin first became involved with cryptocurrency in 2011 when he co-founded the Bitcoin. Buterkin’s main goal was to build decentralized applications. He argued that cryptocurrencies could benefit from other applications other than money and that these needed a separate scripting language that could attach real world assets such as stocks, shares etc. to the blockchain. Buterkin lost support of some of his co-founders when he decided that the cryptocurrency would operate and trade as a non-profit. The name Ethereum was inspired by the element ether as decided upon as the final name for the foundation.
The foundation came with several coded prototypes of the crypto before coming up with ‘Olympic’ which was the last prototype and ultimately selected for the public beta pre-release. (Paul Vigna,2015) In the initial 2014 sale, Ethereum went on sale for 42 days for the first time and could be directly bought with Bitcoin or BTC.
Impact of Technology
The Ethereum as cryptocurrency has been a widespread impact on the traders as well as investors which resulted in an increase in market participation recently. It will affect people’s lives in many ways. It can help in the enhancement of all the areas of the society. The execution of the Ethereum technology is carried out on ‘Smart Contracts’. In this modern world, digital devices are an integral part of our lives for almost everything like work, recreation, learning etc. These devices run different application programs that are designed by the software engineers. So, what Ethereum technology can do is, it can make such applications decentralized. Decentralized applications could be controlled by any single person or an organization. Unlike apps controlled and monitored on Google’s server, the privacy of the users or the user’s data is highly safe and secured as there’s no such parent entity which keeping an eye on it. There’s also been a rapid increase in cyber thefts. This technology could also help in protecting us from frauds that are performed by third parties by not disclosing our data like financial transactions. The Ethereum blockchain technology really helps people as the contracts they enter are self-guided and hence reliable as per their own requirements. This system is very fast and efficient and has a high level of transparency. But if we talk about the cons, blockchain technology contributes to high level of energy exhaustion which is a factor that contributes to environment depletion. Moreover, it uses too much of electricity that is affecting our mother earth. It should amend the way of its current working and should
The creators of this technology have believed that this can change the world. It can also bring humongous change in the economy. The sectors of healthcare and music industries are also inclining towards this technology. This technology is said and could be the future of entire world’s financial sector. Day by day, it is emerging as a major technology that has the power to reach great heights. More and more people are joining in believing that this will be the future. In coming years, it could be a success for sure.
Future Advancements AND/OR Future Application of the Technology
Cryptocurrency has been one of the most interesting topic of debates in the modern day. Being a part of it can yield a lot of capital as has been proved by a lot of people trading cryptocurrencies. With this fascination in the people, cryptocurrency has managed to hold a lot of stakeholders. The technology is full of opportunities as at the present moment. Ethereum has a great deal of potential to change the whole financial dynamics of the world. As per the techno experts this technology will be on the rise in the time to come. Therefore, the tech giant is planning for some advancements and some new products for the market. Some of the major companies in the food industry are adapting to the blockchain technology in the supply chain process so as to get an efficient and decentralized way of trading. They are planning to enter the digital media platforms that provide streaming and alter its working process with their new ideas. Other sectors like banking are seeming to come off as ‘worried’ as this technology has the potential to replace a major part of the banking industry. The government also can highlight threats as the technology has a potential of exceeding joint funds that are greater than some of the developing countries entire budgets. These technologies also come with disadvantages as it could easily lead to black marketing through the dark web. The governments also use this technology for carrying out many of the daily activities. Sectors like the civil, healthcare, education etc are also highlighted targets to be worked upon. The creative sectors are also that could be affected from these technologies. Therefore, it can be concluded that this technology has the ability, capability, ideals, power to make a big difference in this world of ours in the near future.
Reference
Antonopoulos, A. and Wood, G., 2019. Mastering Ethereum. Sebastopol, CA: O’Reilly Media, Inc.
Infante, R. and Bertani, T., n.d. Building Ethereum Dapps.
Paumgarten, N., 2021. The Prophets of Cryptocurrency Survey the Boom and Bust. The New Yorker. Available at: <https://www.newyorker.com/magazine/2018/10/22/the-prophets-of-cryptocurrency-survey-the-boom-and-bust> [Accessed 14 May 2021].
Vigna, P., 2021. Chiefless Company Rakes In More Than $100 Million. [online] WSJ. Available at: <https://www.wsj.com/articles/chiefless-company-rakes-in-more-than-100-million-1463399393> [Accessed 14 May 2021].
Minoli, D., 2020. Special Issue of the Elsevier IoT Journal on Blockchain Applications in IoT Environments. Internet of Things, 10, p.100149.