Currently Cryptocurrency is the most crowded market in the world, even the volatility that occurs is very large every day. Cryptocurrency is a currency that adopts decentralized peer-to-peer Blockchain technology. That is, there will be no interference from third parties who can take advantage of the transactions carried out.
In 2017 Cryptocurrency is the biggest growth value is Ethereum. At the beginning of the year Ethereum only traded at a price of $ 8.57 per 1 Ether. Then in the middle of this October, Ethereum is traded at a price of $ 316.60 per 1 Ether, which means the value of Ethereum has increased by almost 4,000% this year alone.
However, what is Ethereum? What is the difference between Ethereum and Bitcoin? This article will give you basic knowledge of the rising crypto currency.
Background of Ethereum
Ethereum was created in 2014 by Vitalik Buterin, one of the Bitcoin developers from 2011 to 2013. When Buterin developed Bitcoin, he discovered an innovation that the crypto currency must be made more easily "adjusted", so that Bitcoin could have a bigger role than just used as a storage area for wealth.
Therefore, Buterin and several of his colleagues started a project to create crypto currencies that can be used for various types of transactions, and can be adapted by various platforms.
What is Ethereum?
Ethereum is a programming language platform for storing crypto money assets with Ether (ETH) unit values. Ethereum adopts a Blockchain system that is used by crypto currencies in general such as Bitcoin. Blockchain was created in 2009 along with the creation of Bitcoin by Satoshi Nakamoto, where the internet revolution began with a unique code that cannot be changed (eternal). Blockchain is a decentralized digital ledger that keeps records of all transactions (blocks) carried out from the start of the technology made.
Ethereum was created with the aim of creating a platform where Smart Contracts can be run. Smart Contracts are self-executing contracts written in lines of code where the agreement in the contract can be carried out automatically. Smart Contracts allows payments instantly without delay, without hindrance, and without a third party (intermediary) carried out on a decentralized network.
Ethereum Virtual Machine (EVM)
Vitalik Buterin created technology Ethereum is different from its senior crypto currency, Bitcoin. Ethereum technology is Open Source technology, meaning that it can be developed by any party in the world. In addition, Ethereum has an EVM (Ethereum Virtual Machine) that allows developers to develop and launch various applications that are integrated in the Ethereum network as transaction facilitators.
EVM is a new network technology that operates on a decentralized network that is safe and transparent. All Nodes on the network will have the same information. Unlike server-based networks on certain topologies, which are very vulnerable to attacks on the server (Central Node) and will affect the entire client network.
Difference between Ethereum and Bitcoin
Indeed, basically, the creation of Ethereum is almost similar to Bitcoin, which is equally decentralized cryptocurrency using a peer-to-peer network (individual-to-individual), created by mining.
However, there are some basic things that distinguish Ethereum from Bitcoin, including:
- Block Creation: Ethereum has an average speed of creating 1 block in 12 seconds, while Bitcoin has an average speed of 1 block in 10 minutes. In other words, Ethereum is faster than Bitcoin.
- Transaction Fee: Ethereum has different fees depending on each computing power, while Bitcoin has a fixed fee.
- Coding: Ethereum uses Turing Complete Code which allows sending scripts with unlimited "loops", while Bitcoin does not have the script.
- The main purpose: Ethereum has a goal as a cross-platform transaction delimiter, which allows Cross-Chain transactions to be carried out. On the other hand, Bitcoin can only transact with other Bitcoin users.
Where is Ethereum Used?
Compared to Bitcoin which has been widely accepted by online and offline stores and recognized by governments in certain countries, the name Ethereum may be less audible. However, do not underestimate this crypto currency. Its use is mainly ogled by large corporations and corporations.
Ethereum is supported by many companies who want to explore and apply the technology for Smart Contract applications. A group called "Enterprise Ethereum Alliance (EEA)" which was founded in February 2017, is known to bring together more than 80 large companies working on projects using blockchain Ethereum. Among the companies involved are multinational financial companies JP Morgan, giant corporations Microsoft and Intel.
The Blockchain, if it is run by the company itself, will give the company more control over their customer transaction data. With higher control, they will be better able to protect customers' privacy. However, this technology is arguably still in its infancy, so there are still many efforts needed to apply it in the world financial system that has been established so far.