Ethereum is a smart contract platform on which developers can build decentralized applications (DApps) on the Ethereum blockchain. Ethereum is the local digital currency of the Ethereum platform.
Part of Ethereum's funding comes from the Ethereum Foundation, which is a non-profit organization under the Enterprise Ethereum Ecosystem. The Ethereum ecosystem also includes many joint enterprises, such as the Enterprise Ethereum Alliance.
How does Ethereum work?
In 2013, Vitalik Buterin conceived Ethereum. His idea was to build Ethereum into an open source blockchain platform different from Bitcoin, and smart contracts were born. On the Ethereum blockchain, a smart contract is like a self-running computer program that will automatically execute when certain conditions are met. Blockchain allows mobile smart contract code to run completely programmed, thus avoiding downtime, censorship, fraud or third-party interference.
The Ethereum network was launched on July 30, 2015, with 72 million coins premined. Ethereum has started implementing a series of upgrades called Ethereum 2.0, which includes a transition to proof of stake and an increase in transaction throughput using sharding.
How to mine Ethereum?
Currently, Ethereum mining is based on the Proof of Work (PoW) protocol (like Bitcoin), which will be converted to Proof of Stake in the future. The principle of Ethereum mining is that miners use computing power to solve mathematical problems (find the hash value of the block header metadata). The first miner to successfully solve the problem (find the hash value) broadcasts to the entire Ethereum network that the block has been mined, and other nodes will add the block to the blockchain after verification.
The Ethereum blockchain originally planned to migrate from a PoW system to a lower-energy proof-of-stake system (PoS) in January 2020, but it failed in the end. Ethereum is expected to switch to a PoS mechanism with the release of Ethereum 2.0 later in 2020.
Ethereum mining is based on the Ethash algorithm. When Ethereum is first launched, each block will give miners a mining reward of 5 ETH. At the end of 2017, the Byzantine hard fork reduced the reward from 5 ETH to 3 ETH. At the beginning of 2019, the reward was reduced to 2 ETH, the so-called "the thirdening" (half the third reward).
Ethash's proof of work protocol makes mining with ASICs unprofitable (unlike Bitcoin). The average block time of Ethereum is 12 seconds, and the difficulty of mining is proportional to the total amount of mining power (or network hash rate) of Ethereum.
Ethereum transactions are called "gas", and they are responsible for powering the operation of the entire network, which means you have to spend "gas" (Ethereum) to make changes to the blockchain. In addition, Ethereum has Turing complete internal code.
What are the functions of Ethereum?
Developers can build DApps on the Ethereum platform. DApps have a wide range of uses, from creating new digital assets, to censorship-resistant network applications, to decentralized autonomous organizations, etc.
Ether is the local currency of the Ethereum blockchain and is also used as a digital currency, which can be instantly sent to anyone in the world. Ether can be used as a payment method or as a store of value.
How to buy Ethereum?
If you don't want to engage in Ethereum mining activities (mining costs are very high, unless you are a professional miner), you can buy Ether on a cryptocurrency exchange. Click on the trading pairs tab to get the latest trading pairs and exchange currency lists related to Ether. Before choosing an exchange, be sure to investigate carefully. You can also store Ether in exchanges or hot and cold wallets.