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Last updated: August 20, 2019 12:43 AM

What is Ethereum

Before you can understand ethereum, it is useful to first understand the Internet.

Today, our personal data, passwords and financial information are stored largely on other people’s computers, in clouds and servers owned by companies such as Amazon, Facebook or Google. Even this CoinDesk article is stored on a server controlled by a company that charges for maintaining this data in case it is requested.

This configuration has a number of comforts, since these companies implement teams of specialists to help store and protect this data, and eliminate the costs of accommodation and uptime.

But with this convenience, there is also vulnerability. As we have learned, a hacker or a government can get unwanted access to your files without your knowledge, by influencing or attacking a third-party service, which means they can steal, filter or change important information.

Brian Behlendorf, creator of the Apache web server, has gone so far as to label this centralized design as the “original sin” of the Internet. Some like Behlendorf argue that the Internet always intended to be decentralized, and a fragmented movement has emerged using new tools, including blockchain technology, to help achieve this goal.

Ethereum is one of the latest technologies to join this movement.

While bitcoin target to disrupt PayPal and online banking, ethereum aims to use a blockchain to replace third parties on the Internet: those that store data, transfer mortgages and track complex financial instruments.

The “world computer”

In short, ethereum wants to be a “global computer” that decentralizes, and some will argue, democratize, the existing client-server model.

With ethereum, servers and clouds are replaced by thousands of the called “nodes” run by volunteers from around the world (thus forming a “world computer”).

The vision is that ethereum would allow this same functionality to people from any part of the world, allowing them to compete to offer services in addition to this infrastructure.

When you scroll through a typical app store, for example, you will see a variety of colorful squares that represent everything from banking applications to exercises and messaging applications. These applications depend on the company (or other third-party service) to store your credit card information, purchase history and other personal data, somewhere, usually on servers controlled by third parties.

Of course, your choice of applications is also governed by third parties, since Apple and Google maintain and select (or, in some cases, censor) the specific applications that you can download.

Take for example online document services such as Evernote or Google Docs.

Ethereum, if everything goes according to plan, would return control of the data in this type of services to its owner and creative rights to its author.

The idea is that an entity will no longer have control over its notes and that no one could suddenly ban the application, temporarily disconnecting all its notebooks. Only users can make changes, not any other entity.

In theory, it combines the control that people had over their information in the past with the easily accessible information that we are used to in the digital age. Each time you save edits, or add or delete notes, each node in the network makes the change.


It is worth noting that the idea has been met with skepticism.

Although applications seem to be possible, it is not clear which blockchain applications will really be useful, secure or scalable, and if they will ever be as convenient to use as the applications we use today.

Images by Maria Kuznetsov

Article Source: http://www.coindesk.com