What is Ethereum and how does it work
What is Ethereum and how does it work?
Ethereum is a decentralized, open-source ethereum blockchain platform that allows developers to build and deploy decentralized applications (dApps). The platform is powered by a cryptocurrency called Ether (ETH), which is used to pay for transactions and computational services on the network. ethereum all time high (ETH) was reached on May 12, 2021, when its price reached $4,356.99 USD per ETH. An Ethereum account is a unique address on the Ethereum blockchain that can hold and send/receive Ether (ETH) or other tokens, and is controlled by a private key.
One of the key features of Ethereum is its ability to support smart contracts, which are self-executing contracts with the terms of the agreement between buyer and seller being directly written into lines of code. This allows for the creation of decentralized applications that can automate complex financial transactions, such as crowdfunding, voting systems, supply chain management, and more.
Ethereum also uses a consensus algorithm called Proof of Stake (PoS) to validate transactions and secure the network. In a PoS system, validators (or "stakers") are chosen to validate transactions based on the amount of ether they hold and "stake" as collateral. This incentivizes validators to act honestly and helps to prevent attacks on the network.
Overall, Ethereum has become a popular platform for developers and businesses looking to build decentralized applications and take advantage of blockchain technology.
How does it work?
Ethereum is a network of computers that run the Ethereum a use software, which is distributed across the globe. When a developer creates a dApp on the Ethereum network, the smart contract code is stored on the blockchain and is executed by the computers on the network. This means that the application can operate without the need for a central authority, such as a company or government, to manage it.
Ethereum uses a consensus algorithm called Proof of Stake (PoS) to validate transactions and secure the network. In a PoS system, validators (or "stakers") are chosen to validate transactions based on the amount of ether they hold and "stake" as collateral. This incentivizes validators to act honestly and helps to prevent attacks on the network.
Ethereum also uses a gas system to pay for transactions and computational services on the network. When a user wants to execute a transaction or run a smart contract on the Ethereum network, they must pay a fee in ether to cover the computational resources used by the network. This fee is known as "gas" and helps to prevent spam and abuse of the network.
Overall, Ethereum operates as a decentralized network that enables developers to build and deploy decentralized applications using smart contracts, while also ensuring the security and integrity of the network through its consensus algorithm and gas system.
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