What Does Ethereum Do Anyway ?
Solidity is the programming language of Ethereum. The main advantage of Ethereum's platform is the ability of the Ethereum system to save a 'state' (or status). In short, this system can detect changes to information and remember it overtime, unless given some logic, the state can also be changed. This is different from Bitcoin, as Bitcoin does not have the ability to manage states - in bitcoin, all transactions happen as soon as possible (ignoring the limits of the network congestion!).
You may hear the term 'protocol' often. But what is a protocal anyway ? A protocal is a system of rules that describes how a computer can interact, send, or receive information over a network. These rules/instructions define the code syntax (or form) and semantics the system is designed to work with.
The Three Parts of the Blockchain:
- Peer to Peer Networking - Computers interacting with each other, but not through centralized authority
- Asymmetric Cryptography - Method for Sending information that any system can verify a senders legitimacy, but for which the message can only be read by the intended recipient.
- Cryptographic Hashing - A way to generate a unique fingerprint , which can be used to verify the data has not been altered.
What gives Ether Value:
- Can be used to Pay to run programs on Ethereum's network
- Since the ether can be considered as a 'fuel' to pay for programs to run on the ethereum network, it can be considered as a commodity which gives the ETH value.
How ETH is very much like Old School Computers:
- Working with decentralized computers is simalr to working with older mainframe computers. In the 1970's, many computers were 'rented' out or shared for time. Ethereum network serves as one large decentralized computer which executes programs in lock-step. Note the term de-centralized, in which the many computers combine to create one "virtualized machine". Keep in mind the changes to the ethereum virtual machine must be done through "hard forking", which would be pushed by the ethereum development core team.
What Smart Contracts Do ?
- Provide Methods For Value. For example, access to a digital content exchange (video player, financial contact creation, finance contract execution, access to device virtual or actual etc)
- Facilitation of Micropayments, User Accounts, and Basic Logic Functionality
Questions/Comments Welcome!