Ethereum is a decentralized open-source blockchain system with its cryptocurrency, Ether. Ethereum also serves as a platform for other cryptocurrencies and the execution of decentralized smart contracts. Ethereum was first described in the whitepaper by Vitalik Buterin in 2013. Together with other co-founders, Buterin arranged the funding for the project in 2014, and the project was officially launched in 2015. Ethereum’s purpose is to become a global platform for decentralized operations; this platform is meant to allow users from all over the globe to design and implement software that is not prone to fraud, censorship, and downtime.
There are eight co-founders of Ethereum, which is a large number for a project. Their first meeting took place in 2014 in Switzerland. Vitalik Buterin, a Russian-Canadian, is the best known among Ethereum’s founders. He is the author of the initial whitepaper released in 2013. And even today, Buterin works to improve the functionality of the platform. Before Vitalik’s involvement with Ethereum, he wrote for the Bitcoin Magazine website. The second most important contributor is Gavin Wood. This British programmer coded the first technical implementation of ETH in C++ and proposed Solidity, ETH’s native programming language. Wood worked as a research scientist in Microsoft before Ethereum.
Ethereum is a pioneer, as it is the first blockchain smart contract platform. Smart contracts are software that allows automatic execution of the actions required to fulfill an agreement between the parties online. These contracts are meant to reduce the number of intermediaries, allowing transaction costs’ reduction while making transactions more reliable. According to Ethereum’s co-founder Gavin Wood, Ethereum’s blockchain was designed to be a sort of “one computer for the entire planet.” Besides smart contracts, Ethereum’s blockchain can host tokens by means of using the ERC-20 compatibility standard.
As of today, there are around 100 million Ethereum coins in circulation. Over 70 million of these coins were generated in the genesis block, the first block on the blockchain of Ethereum. The remaining coins were given as a reward to the miners on the Ethereum network. The reward initially was 5 ETH per block, and today it is around 2 ETH. An Ethereum block is mined approximately within 15 seconds. The main difference between Ethereum and Bitcoin is that there is no limit to the number of ETH coins.
As of today, Ethereum is secured with the proof-of-work algorithm Ethash; this algorithm belongs to the Keccak family of hash functions. However, there are plans to move the network to a proof-of-stake algorithm connected to the major Ethereum 2.0 update.