What is Ethereum?
Envisioned by Vitalik Buterin, a young Russo-Canadian and former bitcoin software contributor, ethereum is a decentralized global computing platform or “virtual machine” that enables anyone to create, store and run “smart contract”-based decentralized applications or dapps. Smart contracts are auto-executing programmed agreements that are recorded on ethereum’s blockchain.
Ether (ETH) is the fuel of the ethereum ecosystem, as it is required to develop, store and run dapps by incentivizing miners of the ethereum network to maintain the virtual machine.
Gatecoin was the first exchange in the world in list ether in August 2015.
The types of dapps built on ethereum spans many tpes of industries and sectors. A full list of the dapps that have been released or still in development can be found at State of the Dapps.
What’s the difference between bitcoin and ethereum?
Think of bitcoin as email, and ethereum as the internet. Although in this case email (bitcoin) proceeded and inspired the development of the internet (ethereum) as it was discovered that bitcoin’s underlying infrastructure could be applied to more applications than just digital currency. So, it’s as if email emerged and its underlying protocol lead to the development of the internet.
Ethereum is a flexible computing platform, bitcoin is a hard-coded digital currency. However, there are organisations such as Rootstock and Counterparty that are enabling dapps to be built on top of bitcoin’s blockchain as well.
Bitcoin is still the largest and most secure blockchain network, but ethereum has more efficient transactions and its community agrees to platform changes more easily than bitcoin’s (albeit controversially). Ethereum’s public image is also relatively positive as its platform has been used and adopted by major companies such as Microsoft, J.P. Morgan and Deloitte, whereas bitcoin’s image is still tainted by its associations as a payment method on dark web old_markets.
What are ethereum tokens?
Ethereum tokens are often created by dapp founders as a way to crowdfund the costs of project development in what is known as a token sale, initial coin offering (ICO), initial token offering or token generation event (TGE).
In most cases, when the dapp is released, the tokens are used as the currency or fuel of that dapp, serving a similar role to AWS credits.
In some cases, the token enables the holder to dividends and voting rights which are organized through smart contracts as part of a decentralized autonomous organization (DAO), a kind of robo-firm that is stored and run on ethereum.
Most ethereum tokens follow a specific technical standard known as ERC20. Gatecoin was the first exchange to list ERC20 tokens and has underwritten many ERC20 token generation events.