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These apps run on a custom built blockchain, an enormously powerful shared global infrastructure that can move value around and represent the ownership of property.
This enables developers to create markets, store registries of debts or promises, move funds in accordance with instructions given long in the past (like a will or a futures contract) and many other things that have not been invented yet, all without a middleman or counterparty risk.
The first category is financial applications, providing users with more powerful ways of managing and entering into contracts using their money. This includes sub-currencies, financial derivatives, hedging contracts, savings wallets, wills, and ultimately even some classes of full-scale employment contracts.
The second category is semi-financial applications, where money is involved but there is also a heavy non-monetary side to what is being done; a perfect example is self-enforcing bounties for solutions to computational problems.
Finally, there are applications such as online voting and decentralized governance that are not financial at all. – Ethereum Yellow Paper
One of the applications of Ethereum are Decentralized Autonomous Organizations. DAOs are coalitions of like-minded individuals which operate outside of the desires or actions of any one leader. These organizations are particularly important in industries that demand privacy and equality in structure.
Four major segments covered are Intro to Bitcoin (and blockchain ), Ethereum philosophy, Applications and Misc., and Concerns. Each of those segments is further divided into subject matter topics and are covered in great detail. 187 pages of introduction to blockchain and Ethereum and, by extension, all ERC20 tokens.
Ethereum allows programmers to run their own programs and software on the Ethereum network. More importantly, it allows programmers to convert other programs in separate programming languages into usable, blockchain-enabled programs.
As a result, the entire process of creating a blockchain program has been overhauled, made easier and user friendly by Ethereum. This innovation lends several real-world industries a potentially revolutionary opportunity.
This means that virtually any program, if given enough time and memory, can be changed into a decentralized program with all the security benefits of a program with blockchain technology.
This isn’t to say that, before Ethereum, the creation of blockchain-enabled programs was entirely impossible. Before the days of Ether and the Ethereum network, programmers had to go through the painstaking process of creating their own, entirely original blockchain before they could run a program on it. (or just copy and tweak the BTC one – case in point: LTC)
This means that the creation of a currency would be an extensive project, taking months to years to even make substantive progress.
With Ethereum, this process is streamlined. Instead of creating a new blockchain, those looking to run their new program can simply plug it into the Ethereum Virtual Machine and convert their work into a usable entity on the Ethereum network.
It is called Ethereum 2.0, it is expected to last 3-5 years and expected to solve or at least tackle with following problems:
1. Privacy (Byzantium hard fork)
2. Consesus safety (Casper – Introducing POS)
3. Smart contracts (formal verification, Viper)
4. Scalability (?????)
Focus was on point 4. Scalability
Ethereum wants to scale thousands of transactions per second on chain without any supernodes using sharding – individual blockchains acting like supernodes within one blockchain, thus making blockchain of blockchains (very simplistic explanation, original video with Vitalik Buterin explaining it is in References & Links section).
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After Buterin unveiled the ethereum white paper, other developers joined ranks.
To get the project off the ground, Buterin and the other founders launched a crowdfunding campaign in July 2014 where participants purchased ether, or the ethereum tokens that function as shares in the project.
Another 12m ether went to the Ethereum Foundation, a group of researchers and developers working on the underlying technology. Every 12 seconds, 5 ethers (ETH) are also allotted to the miners that verify transactions on the network.
Eighteen million ether, at most, are mined per year. Five ether are created roughly every 12 seconds, whenever a miner discovers a block, or a bundle of transactions.
No one knows the total number of ether yet, and the pace of ether creation will be less clear when Ethereum executes its plans to move to a new proof-of-stake consensus algorithm.
This will probably lead to a change in the rules of ether creation, and mining subsidy might decrease.
1 BTC (572/632 USD) = 2000 ETH
August to September 2014
1 BTC (592/471 USD) = 1999-1337 ETH
Creators / Founders
Vitalik Buterin first discovered blockchain and cryptocurrency technologies through Bitcoin in 2011 and was immediately excited by the technology and its potential. He cofounded Bitcoin Magazine in September 2011, and after two and a half years looking at what the existing blockchain technology and applications had to offer, wrote the Ethereum white paper in November 2013. He now leads Ethereum’s research team, working on future versions of the Ethereum protocol.
Dr Gavin Wood
Dr. Gavin Wood wrote the ethereum yellow paper, the “technical bible” that outlines the specification for the ethereum virtual machine (EVM) that handles the state of the ledger and runs smart contracts, for example (see: How Ethereum Works).
Joseph Lubin went on to found the Brooklyn-based ConsenSys, a start-up that focuses on building decentralized apps.
Core Development Team
ETH Creator / Council Member
Patrick Storchenegger is an attorney at law and notary public in Canton Zug, the so-called “Crypto-Valley” in Switzerland. He has many years of experience in international tax and business consultancy, company and capital market law. He advises several international concerns, including those engaged in trading, re-insurance, transportation and blockchain technology as well as donating pro bono services to charitable organisations.
Technical Steering Group
Ethereum Founder / Development
Jeff is one of the founders of Ethereum. He started the first implementation of Ethereum using the Go programming language in 2013 and has been the Go team lead and head developer ever since. The Go client launched successfully on July 30, 2015, marking the release of the genesis block and Ethereum platform.
Some of the board members include:
Marley Gray – Microsoft
Blockchain Principal Program Manager
Jennifer McKellar – CME Group
Senior Director, Digitalization
Thomas Willis – Intel
Business Director, Open Source Technology Centre
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Reference & Links