Ethereum is open access to digital money and data-friendly services for everyone – no matter your background or location. It’s a community-built technology behind the cryptocurrency Ether (ETH) and thousands of applications you can use today.
Ethereum is open to everyone. All you need is a wallet to take part.
Why Was Ethereum Founded?
Ethereum was founded by 19-year-old Russian-Canadian Vitalik Buterin, whose intent was to take the technology that powered Bitcoin’s digital currency and use it to democratize everything from organizations, business, currencies and even enable users to create “your own country with an unchangeable constitution” – putting the decision-making and power to create anything and economic control into the hands of individuals and taking it away from the world’s central banks, corporations and power brokers.
He released a white paper in 2013 delineating his ideas for ethereum, and was awarded the prestigious Thiel Fellowship for his work, along with a $100,000 prize. His ideas attracted other developers such as co-founder Dr. Gavin Wood and Joseph Lubin, who joined him in launching a crowdfunding campaign in July 2014. Ethereum raised $18 million in a crowdsale that was the most successful of its time. Its first platform, Frontier, was launched in July 2015
How Does Ethereum Work?
Based on blockchain technology, ethereum consists of a series of cryptographic, or secure, public records linked together that each are difficult to change because they are stamped with user data, time and date and changes that must be approved by all user.
On the ledger, anyone can create a financial contract or keep debt or ownership registries and eliminate the use of an external recordkeeper or trust officer. They’re called “trustless” transactions. Because of its sweeping size and scope, ethereum’s main technical problem has been speed and storage. It has operated at only a few transactions per second, with other crytpo platforms able to carry out hundreds.
Regulatory Of Ethereum
Ether has been dogged by regulatory concerns for a while, as Securities and Exchange Commission officials raised questions about whether ethereum should be regulated as a security. Another dark cloud hanging over all cryptocurrencies has been the ongoing SEC investigation and Department of Justice investigations into bitcoin and other cryptocurrencies.
The altcoin took a hit when Gary Gensler, a former Commodities Futures Trading Commission (CFTC) chairman, said that “there is a strong case that one or both of [Ethereum and Ripple] are noncompliant securities.” The word “noncompliant” raised worries that only registered stockbrokers would be able to deal in ether. At the time, the report sent ether plunging.
Others have speculated that cryptocurrencies won’t be able to compete with USD or EUR cryptocurrencies once the central banks decide to issue their own digital coins. Those arguments seem to ignore the decentralization aspect of cryptocurrency its proponents favor, as well as the privacy and anonymity crypto provides.
The main obstacle for the technology has been that it is difficult for the average person to understand, so until it becomes more broadly accessible, it will struggle with misperceptions.
Is Ethereum Safe?
The short answer is this: Ethereum itself is more secure than you might think, but using a decentralized app or exchange that hasn’t be properly vetted could leave you and your ether compromised. Read on for a breakdown of how best to understand the major security issues of Ethereum and its smart contracts.
At bottom, Ethereum is a blockchainlike Bitcoin’s blockchain: its mining community solves computationally complex problems in order to add new blocks to the public ledger of transactions. The functionality of Ethereum’s blockchain is different from Bitcoin’s, though: it’s designed to operate as a virtual machine that executes smart contracts, which developers can program in a Turing-complete programming language.