To put it in simple words, Ethereum is an open source software platform based on the blockchain technology. It allows developers to create and implement de-centralized apps, and is a distributed public blockchain network. It is a pretty huge platform focuses on running the program code of a given decentralized app.
Just like a vehicle needs fuel to run, so does this platform; its fuel is called Ether, and it’s publicly traded on Cryptocurrency exchanges. Miners in this blockchain earn Ether, and it keeps the network running. App developers also use Ether to pay for services on the network.
Another token used as payment for miners to include transactions in their block is ‘gas’. Each execution of a smart contract mandates a specific quantity of gas to be sent so that miners are encouraged to include it in the blockchain.
This is nothing but a computer code that can enable exchanging any valuable thing like money, shares, property or content. On the blockchain, a smart contract is similar to a computer program whose execution is automatically triggered when certain conditions are met. Smart contracts run on blockchains, and therefore run just as they have been programmed to; there is no possibility of third party intrusion, censorship, deception or downtime.
All blockchains can process code, but many are very limited; Ethereum is not. It enables developers to create any operation they may need, rather than providing them with a suite of limited operations. This freedom allows developers to create thousands of apps.
Benefits of a decentralized Ethereum Platform
- Immutable – safe from third-party data alteration
- Corruption proof – censorship is avoided as the apps are built on a network that is formed on the basis of consensus
- Secure – cryptography and the absence of a central failure point means that apps are protected against hacks and fraud
- No downtime – apps cannot be turned off, and they never go down
We’ve already seen that on this platform, de-centralized apps can be created and deployed. Nearly all centralized apps can be decentralized with Ethereum – intermediary services like loans provided by financial institutions, voting systems, regulatory compliance, title registries, and a whole lot more.
Decentralized Autonomous Organizations, or DAO can also be built on Ethereum; this is an autonomous, decentralized organization which does not have one leader. It is run on the Ethereum blockchain by a software program on a suite of smart contracts. The framework of a conventional organization is replaced by this code – thereby doing away with the need for central control or human intervention. Anyone who buys tokens becomes owner of the DAO, and each token is a contribution that confers voting rights on the holder.
Ethereum has the potential to radically transform the healthcare system. Throughout the world, hospitals will be able to record, access and share patient records, which could greatly assist in the R&D for new vaccines for prevention or mitigation of outbreaks of viral diseases. For example, let’s say you contracted some disease when on holiday in the Carribeans, and you go to a hospital for treatment; when you return to Florida, you go for a follow-up. Both doctors will have the same info about you – and up-to-date health records. Patients who use wearables can benefit too; the data recorded by your monitor/smartwatch can be shared with other hospitals globally, and they may be able to detect patterns in heart attacks and strokes; these devices can be triggered to warn you before an attack happens.
Transactions are what makes the economy function – and we may well see Ethereum revolutionizing them. Smart contracts on Ethereum blockchains make it virtually impossible for any fraud or intrusions, enabling risk-free transfer of valuable things. Finance, real-estate and insurance are likely to be the prime industries where Ethereum makes a huge impact and disrupts the way transactions are performed or executed.
Voting can be made 100% tamper-proof as no single person has total control over the Ethereum network; again, every change is logged and displayed publicly. Ethereum will be able to ensure more transparent and fair elections.
Ethereum plays an important role in self-driving cars. As these cars communicate among themselves at very high speed, they are much safer than human driven cars. Ethereum makes this communication possible.
Companies that offer data storage, store vast amounts of data in server farms; these are basically buildings with tons of servers. The disadvantage is that if the building gets damaged due to whatever reason, the companies can suffer immense loss, as everything is in one location. Ethereum can help in decentralizing the storage by storing in multiple data centers across the globe.
Cryptocurrencies like bitcoin are another arena of Ethereum application; owing to the increased security offered by Ethereum, Cryptocurrency can be easily traded on this network.
To Sum Up
Ethereum enables smarter, quicker, and safer transactions, and helps decentralize applications. The sky is the limit when it comes to its potential for applications. It can be used across a wide range of industries and services.
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