Ethereum Cheat Sheet: All You Need To Know About It
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Ethereum is a revolutionary technological platform that aims to completely change the way in which we use the internet. If fully actualized, it will transform all of our interactions with one another, including handling finances, storing data, and making contracts.
At the end of July 2021, cryptocurrency Ethereum would be processed around 1.1 million times per day. (Statista)
This cheat sheet will tell you all the essential things about Ethereum, so let’s get started knowing about this revolutionary technology!
What is Ethereum?
Ethereum is an open software platform based on Blockchain technology that empowers the best Ethereum developers to create and deploy decentralized applications. It’s a cryptocurrency with its own built-in programming language (Turing complete) called Solidity. Ethereum’s currency is called Ether, and it works as the “gas” that powers smart contracts.
Moreover, Ethereum has the same working principle as Bitcoin. It is based on blocks, but there are some small differences: Blocks in Ethereum can be created faster because they aren’t being mined via Proof of Work algorithms (like Bitcoin). Every 13 seconds, a new block is generated, and every 15–17 seconds, transactions between accounts take place. In this case, security is provided by linking blocks together in a Merkle tree.
Crucial Features Of Ethereum
Ethereum has a range of features that make it more than just an alternative to Bitcoin. These include:
- Turing completeness: Ethereum can run any program you write and is based on the same code as another cryptocurrency called BitCoin.
- Token Sharing: Tokens are generated by smart contracts and can represent any fungible tradable good such as coins, loyalty points, gold certificates, or something else. Tokens have been used in ICOs (Initial Coin Offerings) to raise funds for blockchain projects.
- Smart Contracts: Ethereum has its own built-in programming language (Turing complete) for writing smart contracts. These are programs that enable you to create a virtual contract between two parties, and they will be executed without any interference from third parties or the possibility of downtime.
- Ethereum Virtual Machine: Every node in the network runs the EVM to maintain consensus across every Ethereum client. It’s a security model that ensures state transitions happen smoothly and safely.
What Are The Benefits Of Using Ethereum?
Here I have mentioned a few pointers that will help you know two things: the benefit of using Etherum and why businesses should look forward to adopting it. So let’s get started:
- Data Coordination: Ethereum can help the dedicated Ethereum development team to build apps that are decentralized in nature. This means all the data will be stored on a public ledger, and it moves between accounts.
- No Downtime: Ethereum uses Blockchain technology; there won’t be any possibility of downtime and third-party interference because everything happens on smart contracts that cannot break or get hacked.
- Easier to Use: Since there is no need to spend a lot of time understanding the whole mechanism, and it’s just like any other platform that will help you understand how things can be done, Ethereum makes life easier for developers as well.
- Cost-effective: Unlike traditional apps where every user needs to pay a transaction fee on a monthly basis, apps that are built on the Ethereum platform users need only pay for the transactions they make.
- Data Security and Privacy: Since everything is public, even apps like Facebook won’t be able to track your activities on it, which means data will remain secure from any kind of misuse or theft.
- Scalability: This means there won’t be any downtime or third-party interference because everything runs on smart contracts, and transactions are done almost instantly, so scalability remains one of the top benefits of Ethereum.
- Network Size: Ethereum has the capacity to process more transactions because of its size. In fact, it is bigger than all other blockchains combined (100 GB vs 40GB).
Ethereum Cons
- Decentralization: Ethereum had one big flaw. It was created to be a decentralized platform, but it has some of its nodes controlled by centralized groups, which can lead to serious security issues.
- Unstable: Since it is a relatively new technology, Ethereum has suffered from several outages and hacks.
- Dependability: Some people find it difficult to trust Ethereum because it is still a very new technology with no proven track record.
- Transactional Speed: Because of its design, Ethereum’s transactions are slower than those on its rival networks.
Some Real World Use Cases Of Ethereum
Ethereum has been used by various companies that want to raise money through an ICO (initial coin offering). Many companies also use it for creating their own tokens. Tokens are created on the Ethereum blockchain; they can be easily transferred between different accounts — it’s really easy to imagine how this works when you think about the currency being sent in email or messages from one person/account to another. Some of the use cases of Ethereum are as follows:
Health Applications
Health applications like Patientory are built on the Ethereum blockchain. They provide a way for patients to control access to their own health records while also sharing them with physicians and other providers as needed — all without relying on any intermediary or central authority.
Tokenizing Assets
Another great example is the company called Blockchain Capital. They created a security token on Ethereum, representing ownership of their venture fund and making it easier to invest in other companies (with liquidity).
Ethereum has been used by some pretty well-known brands like Microsoft, IBM, Samsung, etc., for building decentralized applications with smart contracts that work across various industries.
Digital Identity
Ethereum’s blockchain allows for the creation of decentralized and secure digital identities. In other words, it would enable users to create their own unique ID tied to a specific Ethereum address. This can be used by companies that need KYC when customers want to use some services on a platform or buy tokens during an ICO sale (e.g., peer-to-peer transactions).
Sovrin is an app built on the Ethereum blockchain. It gives you a self-sovereign digital identity that can be controlled by its user and used across platforms with different applications (in other words, it’s not tied to just one service).
Games
One of the most popular games called Cryptokitties is built on Ethereum. It’s a game where you can buy, collect and breed virtual cats (like in Pokemon), but they are really unique because when you trade them with other players, every transaction gets registered on the blockchain as well. This allows for instant ownership transfer, and no one can take away your kitty!
Well, seeing the use case, if you are also thinking of Ethereum App Development, get connected with a top-notch Blockchain development service provider. They will help you in developing a leading application and suggesting excellent Ethereum App Development Solutions.
