FinTech

Ethereum: The Next Big Thing?

Ethereum is a decentralized platform that runs smart contracts: applications that run exactly as programmed without any possibility of downtime, censorship, fraud or third-party interference. That allows you to almost fully implement the ideas of the Bitcoin 2.0 platform. The project was first introduced in January 2013 at the Bitcoin Conference in Miami. The official website of the new platform is https://ethereum.org/.

What makes Ethereum different from other crypto-currencies

The aim of Ethereum is creating an alternative protocol for building decentralized applications, providing a different set of tradeoffs that we believe will be very useful for a large class of decentralized applications, with particular emphasis on situations where rapid development time, security for small and rarely used applications, and the ability of different applications to very efficiently interact, are important. Ethereum does this by building the ultimate abstract foundational layer: a blockchain with a built-in Turing-complete programming language.

Smart contracts, cryptographic “boxes” that contain value and unlock it if certain conditions are met, can also be built on top of the platform, with vastly more power than that offered by Bitcoin scripting because of the added powers of Turing-completeness, value-awareness, blockchain-awareness and state.

Ethereum, unlike other 2.0 platforms (for example, Counterparty, Factom) that operate on the Bitcoin platform blockchain, is developed from scratch, has its own message system, its own programming languages, decentralized browser and data management system.

Bitcoin and Ethereum platforms hav a lot of common features, in particular, open source code, blockchain, own crypto-currency, support community, decentralized confirmation mechanism. However, there are more differences in the technical side between these platforms than general characteristics.

It should be noted that Bitcoin was initially developed as a crypto-cash decentralized network for the transfer of monetary value and the blockchain of the system is aimed at providing financial transactions. Only recently Bitcoin blockchain started being used in scenarios not having direct relationship to finance. Taking into consideration Bitcoin development experience, Ethereum creators eliminated main issues inherent in Bitcoin system. For example, Bitcoin’s blockchain confirms transactions within 10 minutes, Ethereum needs only 5-30 seconds for similar operations.

Ethereum’s paradigm is based on a network of decentralized applications and implementation of such applications is possible with existence of a controlled, deterministic computing platform. Bitcoin’s trivial computational platform is organized around the currency.

Unlike Bitcoin, Ethereum as a crypto-currency is not a digital “gold”, it cannot be used as a means of payment for goods and services. “Ether” is the main internal crypto-fuel of Ethereum, and is used to pay transaction fees.

From economic point of view, Ethereum’s blockchain is more efficient than Bitcoin’s one. Scaling function is improved and block size is unlimited for the new version of the platform.
 
Programming languages of Ethereum platform

Programming any blockchain is one of the main features of a particular platform. Ethereum supports four programming languages designed for contract-based programming:

• Serpent: Python-like contract language
• Mutan: C-like contract language
• Solidity: JavaScript/C++-like contract language – object oriented, static typing
• LLL: Low Level Lisp-like contract language

Each Ethereum language is designed specifically for blockchain of the system, that’s why they provide efficient and convenient access to transaction data in the real-time. To get the necessary data in the Bitcoin system, the user needs to import the entire blockchain, sort all transactions and perform queries in order. In turn, Ethereum allows you immediate data request that is stored in blockchain under a specific address.

Business prospects for using a new crypto-currency

The basic ideas of Ethereum’s creators reveal the wide possibilities of using new platform and its crypto-currency in business. First of all, Ethereum platform is interesting for developers, it’s very important for managers and entrepreneurs to understand and to assess the potential of decentralized applications. Some ideas are not always enough to discover the full potential of applications, it is important to cooperate with reliable business partners who are ready to apply their own knowledge and professional experience.

The following companies and specialists should get familiar with Ethereum platform and its crypto-currency to introduce new technologies into business projects:

• modern IT departments;
• enthusiastic developers;
• innovative start-ups;
• investors, leaders, visionaries;
• Bitcoin enthusiasts.

In order to develop your business successfully using Ethereum technology, progressive leaders should find resources that are needed to study the new platform, provide funding for projects aimed at realizing the potential of new decentralized applications.

 
Yulia Nenadovich

Yuliya Nenadovich

Business Development Manager

E-mail: Yuliya.Nenadovich@altabel.com
Skype: yuliya.nenadovich
LI Profile: Yuliya Nenadovich

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