What is Ethereum?

Ethereum is an open-source platform based on blockchain technology, jointly created by programmer Vitalik Buterin and his team in 2015. Unlike Bitcoin, Ethereum is not only a cryptocurrency, but also a global distributed computing platform that supports smart contracts and decentralized applications (DApps). Its innovation has brought broader application scenarios to blockchain technology.

1. Core concepts of Ethereum

The core of Ethereum lies in its support for smart contracts. Smart contracts are self-executing programs running on the blockchain, with terms written in code that can be automatically executed when predetermined conditions are met. This mechanism eliminates the need for intermediaries, making transactions more efficient, transparent, and secure.

In addition, the native cryptocurrency of the Ethereum network is called Ether (ETH for short). Ether is not only a tool for paying transaction fees and rewarding miners, but also a "fuel" for developers to deploy and run applications on the Ethereum network.

2. Features and Functions of Ethereum

The uniqueness of Ethereum lies in its programmable blockchain, which supports users to build decentralized applications (DApps) on it through the "Ethereum Virtual Machine" (EVM). These applications cover multiple fields, including decentralized finance (DeFi), non-fungible tokens (NFT), supply chain management, identity authentication, etc.

Decentralized Finance (DeFi): Ethereum has fueled the rise of DeFi, enabling users to borrow, pay, and trade without relying on traditional financial institutions.

Non-fungible token (NFT): Based on the Ethereum ERC-721 standard, NFTs are widely used in the fields of art, games, and digital collectibles.

Openness and Transparency: Ethereum's code is open source, and all transactions and application data can be publicly verified on the blockchain.

3. The development and upgrade of Ethereum

The Ethereum network is constantly evolving, and the Ethereum 2.0 upgrade (also known as the "consensus layer") is an important milestone. The upgrade transitions from Proof of Work (PoW) to Proof of Stake (PoS), aiming to improve the efficiency, security, and scalability of the network, and significantly reduce energy consumption. This change will make Ethereum more environmentally friendly, while improving transaction speed and reducing transaction fees.

Conclusion

Ethereum is a blockchain platform, supported by smart contracts and decentralized applications, providing broad space for technological innovation and business applications. As an important component of blockchain technology, Ethereum not only promotes the development of cryptocurrency, but also brings a new decentralized economic model, which is profoundly affecting multiple industries worldwide.

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