Ethereum is often considered a 2.0 version of cryptocurrencies. These currencies are build on a blockchain that allows developers to make software on top of the Ethereum network. Of course the network is decentralized. It enables Smart Contracts, which are scripts that define a connection that can’t be changed, and Distributed Applications (DApps). These can be build and can run on the network without downtime, fraud or interference from a third party. You can consider Ethereum to also be a programming language.
ETH can be used as a crowd funding platform. For your new project, you can set up a contract and seek pledges from the community. The money that is raised will be held until the goal is reached or until an agreed upon date. The funds will be released back to the contributors if the goal is not met, or go on to the project if it is successful.
Ethereum is powered by Ether (ETH). It’s transactions can be confirmed within seconds or several minutes… unless the blockchain is having difficulty with insane amounts of traffic. Ethereum can handle 15 transactions per second, compared with 6 transactions/sec from the Bitcoin.
Bitcoin and Ethereum also cost their transactions in different ways. In Ethereum, it is called Gas, and the costing of transactions depends on their storage needs, complexity and bandwidth usage.
A token is generally defined as a thing that serves as a representation of something else. On a blockchain network, a token often represents value, like how tokens at a festival represent money for example. An ERC20 token is no different, it also just happens to conform to Ethereum’s token standard. Which makes it easier to change tokens… financially that is.
- Ether is a software platform
- Often considered ‘digital oil’ because it powers other projects
- Target of 12 seconds for a transaction
- Fee price: 0.2 ~ 1.4 USD (December 2017)
- ERC20 tokens are used as a standard among applications built on the blockchain
- First blockchain to implement Smart Contracts