What is ethereum?

Possibly the most interesting use of blockchain technology in the world right now is Ethereum.

It’s incredible…but also a little hard to describe in under a million words (however I will try).

Ethereum does have it’s own currency, Ether, and like bitcoin it uses blockchain technology to record and verify all transactions, but that’s where the similarities end.

Essentially Ethereum is the world’s first decentralised computer, it uses the internet and a blockchain to keep everything synced and unhackable. Well, mostly..

Ethereum is so sophisticated that even its creators still sometimes struggle to define it and figure out what it can be used for.

Because it’s essentially a computer anyone can write code on the network that Ethereum will then execute automatically to do things such as create websites, store and execute a will, finance a company with crowdfunding, sell goods or services, and so much more.

For example, a record company could create a contract on Ethereum that automatically pays music artists every single time their records are played anywhere in the world.

If Bitcoin is a calculator, then Ethereum is a smartphone, and we haven’t even dreamed of all the possibilities yet.

[If you want to learn about Ethereum and the rest of the world of fintech in plain English we put together a short online course at 42courses.com/fintech )
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Saloni Sardana
Saloni Sardana, Bitcoin Enthusiast
Answered Jun 27, 2016
Originally Answered: What is Ethereum?
There’s a lot of misconception among people regarding bitcoin and ethereum. The two are no way similar. Bitcoin is a digital currency or a cryptocurrency while ethereum is public blockchain platform for the execution of decentralized smart contracts. However, Ethereum also has its own cryptocurrency called Ether which is definitely comparable to bitcoin. So the question should be, “What’s the difference between Ether and bitcoin?” Although, the same term i.e Ethereum is often used for both. For instance, Ether mining and ethereum mining both are valid keywords.

Main Points Of Difference Between Ethereum And Bitcoin

First of all, the pre-set block time in Bitcoin is 10 minutes whereas in Ethereum, the block time is of 12 seconds. So consequently, while bitcoin transactions normally take a few minutes to be cleared, the Ethereum transactions are cleared almost instantly and in matter of seconds.
Ethereum uses a Turing Complete programming language and a Turing Complete internal code owing to which almost anything can be calculated by just providing sufficient computing power and a particular time period.
Both Ethereum and bitcoin use different hashing algorithms. While Bitcoin uses SHA-256 algorithm that produces a number in hexadecimal format, Ethereum uses Ethash algorithm.
Ethereum uses a Ghost Protocol that fends off the use of centralized pool mining. Whereas bitcoin still employs the pool mining concept.