Brief History of Ethereum
Ethereum grew out of the frustration of Vitalik Buterin with the shortcomings of Bitcoin when he suggested creating a new platform with a universal scripting language. The Ethereum white paper’s release in 2013 documented a new open-source protocol for creating decentralized applications that are different from Bitcoin, thus pioneering smart contracts. Uncommonly,Ethereum has a long list of early founders which includes Vitalik Buterin,Charles Hoskinson, Mihai Alisie, and Amir Chetrit in 2013. However,Joseph Lubin, Gavin Wood, & Jeffery Wilke are also co-founders added in 2014.
What Is Ethereum?
Ethereum is a decentralized network running smart contracts: programs running as designed, without any risk of interruption, censorship, theft, or intervention from third parties. These apps run on a custom-built blockchain, an enormously powerful global shared infrastructure that can move value around and represent property ownership. It is a network of computers working together to replace the centralized model of programs and companies which run the internet.
The ethereum network’s goal is to decentralize the internet by connecting people through a powerful decentralized supercomputer. The cryptocurrency of the ethereum network is the Ether, and it is the solution to the issue of payment- a digital asset bearers like a bond or other security. It is the fuel for the apps on the decentralized ethereum network.
Is Ethereum Gambling?
In as much as many people are still trying to understand cryptocurrencies since its knowledge is not yet widespread,it is essential to note that ethereum is not gambling. Gambling involves the staking of money or something valuable on an event whose outcome is uncertain with the intent of winning as this revolves around individuals taking a risk on a chance occurrence.
Can ethereum be used for gambling? Definitely Yes!
Like every other currency like the dollar,euro, pounds, and what have you, cryptocurrencies can also be used for gambling because they are valuable digital assets. Because Bitcoin and Ethereum are the leading cryptocurrencies in our world today, Bitcoin gambling and Ethereum gambling are respectively becoming very popular.
What is a Smart Contract?
Ethereum isn’t much about transactions; instead, its essence is to control and manage smart contracts. Ethereum runs smart contracts, a transaction protocol with nature for the reduction in trusted intermediates, arbitrations and enforcement costs, fraud losses, and the decrease of malicious and accidental exceptions using Ether.
To illustrate a smart contract, let’s say Ann and Ben enter into a bet.
Ann thinks that the temperature tomorrow morning will reach 60 degrees, while Ben believes otherwise. They then wager 20 bitcoin on the outcome.
If Ann and Ben don’t trust each other, they will have to use a trusted third party as an escrow agent. In other words, they will each have to give the agent that amount of money and the agent will distribute the winnings and the amount staked to the winner.
There’s no way around the middleman in this scenario, even using a cryptocurrency like bitcoin. There is no record of this “contract” by the Bitcoin blockchain.
Ethereum offers a “smart” solution. Ann and Ben could agree to use some underlying code — an “if, then” contract of sorts — that pays out based on the temperature. If the temperature is higher than 60 degrees, the code is programmed to pay Ann; otherwise, it pays Ben. Ann and Ben could then place their sort of “programmed” bet on Ethereum’s Blockchain. At that point, it becomes binding from a technological standpoint.
The above is a “contract,” because Ann and Ben have agreed to its terms, to a degree transforming code into law. It’s “smart” and “decentralized” because all participants in the Ethereum blockchain have a copy of this contract.
Just as all Bitcoin “nodes,” or participants in the system, know that Ann sent Ben one bitcoin, all Ethereum nodes know that Ann and Ben have entered this bet.
Let’s now see how ethereum works.
How does Ethereum Work?
The power of smart contracts allowed Ann and Ben to build a tiny “decentralized application” -which was their wager “self-executed and paid out without the use of any form of a middleman. Is it possible for us to build more complex and larger decentralized applications equipped with smart contracts than can do complicated things?
Think of it like this: every time you execute a smart contract or run a program, thousands of nodes execute the same agreement or run the same program. Any time a system or contract or user carries out any action,nodes must agree that the work has taken place.
In this way, a decentralized network-the blockchain of Ethereum enables such programs to run rather than a central authority. Where the Bitcoin network validates bitcoin ownership, the Ethereum blockchain approves smart contracts and implements them according to their encoded rules.
If Ethereum is not gambling,is it safe and legal?
The Ethereum program, though at the same time being a decentralizedapp store, strives to function in the same way the internet does. Safety is inevitably one of the most significant selling points of Ethereum. The applications built on this Blockchain (called dApps or decentralized applications) are substantially safer and more hacking-resistant.
The buying and selling of ethereum should not be a gamble but based on in-depth knowledge and understanding of the ethereum network, and its cryptocurrency, the Ether (ETH). Supply and demand control the ethereum network and its price.
If more individuals purchase Ether than sellers, then the price will increase. Whereas whenmore individuals are eager to sell than buy, then the price will decrease.On a general note, ethereum is legal, although its acceptability differs from one country to another.
Based on safety,ethereum can be stored and secured in wallets. There are various available ethereum wallets apps for multiple devices.
Setting up Ethereum Wallets
There is a need for the storing of ethereum.Cryptocurrency wallets grew out of that need, and there are many wallets available today. Mostly, it’s software that lets you save yourfunds, conduct transactions quickly, and check your balance whenever you need it.
It is worth noting that wallets in Ethereum do nothing as traditional physical wallets do. Ether isn’t actually stored in your purse, or anywhere else for that matter.Ether, like any other crypto-currency, does not exist in any physical form or shape.
All that exists are Blockchain records and your wallet can only connect with the Blockchain to allow for transactions.Wallets have public addresses generated randomly by case-sensitive letters and numbers. When anyone wants to give you some Ether, they’ll give it to that address, which is often referred to as a ‘public key,’ effectively transferring coin ownership.
Public and private keys must are pairs, which means that the two strings of numbers and letters should match to allow you to perform every other transaction. It is of utmost importance to keep the passwords and requirements to access the wallets safe and secure.
If ethereum is Not Gambling,How Can It Be Earned?
There are several ways of earning ethereum. There is a wide misconception that it portrays that cryptocurrencies can be found and collected on the “streets” of the internet without working for it. This notion then aids the myriad of miscreants who scams people by making them believe that they will receive massive cryptocurrencies on completing a given task within a short time.
Most of these platforms are fake and are only after their gains, which is where the knowledge of ethereum becomes essential.
Among other ways of earning ethereum,let me highlight just three ways of making ethereum.
- Work and Be Paid With Ethereum;
Just like getting paid in dollars or euros,some firms and establishments make payments to service rendered using cryptocurrencies- ethereum. The amount of ethereum paid is proportional to the agreed amount and the value of services provided.
- Buying and selling of ethereum;
Because of the volatility of ethereum,there are always changes in the value of the cryptocurrency. As of 2014, the price of 1 Ether goes for $0.4, but the price today is quite over $200 and still have the tendency to increase more. There has been a significant rise in the value of ethereum since 2017.
Because of these fluctuations in the value of ethereum,people take advantage of the volatility. They are buying when there is a reduction in price and selling on the increase in price.
- The Mining of Ethereum;
Ethereum mining involves the process of solving complex mathematical problems by the use of a Graphical Processing Unit (GPU) only. A miner gets rewarded for solving this mathematical problem and earns ethereum. These mathematical problems are usually verification of ethereum transactions andEthereum Blockchain.
This verification process is known as the proof of work, and the job of miners is to make sure that no one cheats.
Ethereum is not gambling instead, because it runs on Blockchain technology.It is immune to any third party interventions,which means no one can control all the decentralized apps deployed within the network. Ether (ETH), which is the cryptocurrency of the Ethereum networkand arguably,the most popular digital token after bitcoin, can be earned in several ways and also tend to increase in the future.
Ethereum has allowed the development and running of Smart Contracts and Distributed Apps(DApps) without any third party abuse, control, downtime, or intervention.
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