Chapter 2Ethereum
Vitalik Buterin is the cofounder of the Ethereum blockchain, a second‐generation open source software platform with a general scripting language, which created a protocol for building reliable decentralized trusted networks. It extends the functionality of Satoshi Nakamoto's blockchain design, which powered decentralized peer‐to‐peer Bitcoin payment by adding smart contracts, also called scripting.1
This feature allows the platform to store and run computer programs and enables developers to build and deploy decentralized applications and create whatever operations they want with a permanent, trusted record of assets and transactions.
The first public Ethereum‐backed network went live in 2015 and supports ether (ETH), currently the second‐highest‐valued cryptocurrency at $481 billion.2 Ethereum's initial coin offering (ICO) has been one of the most successful, with over 778,000% in gains from 2015 to 2022. The Ethereum network is used by application developers, and ETH is used to pay for transaction fees and services on the Ethereum network.
Smart Contract Technology
The blockchain's main disruptive element in today's commercial and economic ecosystem is its ability to eliminate the need to trust intermediaries to certify a transaction. This feature lends Ethereum blockchain well to being used to create smart contracts.
Smart contracts are computer protocols, or algorithms, that can verify the negotiation process or performance of contracts—to the extent ...
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