What is Ethereum?
Ethereum is a decentralized, open-source blockchain platform that enables developers to build and deploy smart contracts and decentralized applications (dApps). Since its launch in 2015, Ethereum has become one of the leading cryptocurrencies and blockchain ecosystems, second only to Bitcoin in market capitalization.
Key Features
- Smart Contracts: Self-executing contracts with the terms of the agreement directly written into code, allowing for trustless transactions.
- Decentralized Applications (dApps): Applications that run on the Ethereum blockchain, reducing reliance on central authorities.
- Ether (ETH): The native cryptocurrency of the Ethereum platform, used to power transactions and compensate participants for their computational services.
Ethereum Ecosystem
The Ethereum ecosystem comprises a diverse range of protocols, tools, and communities. Developers can leverage frameworks like Truffle and Hardhat for building dApps, while decentralized finance (DeFi) projects offer innovative financial services without intermediaries. Additionally, Ethereum has evolved through upgrades, such as Ethereum 2.0, aimed at improving scalability, security, and sustainability.
Impact on Finance
Ethereum's smart contracts are revolutionizing traditional finance by enabling peer-to-peer transactions, automated escrow services, and extensive financial applications. This shift is contributing to the rise of a new financial system, often referred to as decentralized finance (DeFi).