An article to understand the past and present of Ethereum

Ethereum (Ethereum in English) is an open source public blockchain platform with smart contract functions. It provides a decentralized Ethereum Virtual Machine (Ethereum Virtual Machine) through its dedicated cryptocurrency Ether (Ether, referred to as "ETH") to Handles peer-to-peer contracts.

The concept of Ethereum was first proposed by programmer Vitalik Buterin between 2013 and 2014 after being inspired by Bitcoin, roughly meaning "the next generation of cryptocurrency and decentralized application platform", and began to develop through ICO crowdfunding in 2014.

Ethereum is now the second-largest cryptocurrency by market cap, after Bitcoin.

Speaking of which, the background of Ethereum is also inextricably related to Bitcoin.

Bitcoin pioneered the decentralized cryptocurrency, and has fully tested the feasibility and security of blockchain technology for more than five years. Bitcoin’s blockchain is actually a set of distributed databases. If you add a symbol—Bitcoin—to it, and stipulate a set of protocols so that this symbol can be safely transferred on the database, and you don’t need to trust a third party , the combination of these features perfectly constructs a currency transmission system - Bitcoin network.

However, Bitcoin is not perfect, and the scalability of the protocol is a deficiency. For example, there is only one symbol in the Bitcoin network - Bitcoin, and users cannot customize other symbols. These symbols can represent the company's stock, or Obligations, etc., which loses some functionality. In addition, the Bitcoin protocol uses a set of stack-based scripting languages. Although this language has certain flexibility and enables functions such as multi-signatures to be realized, it is not enough to build more advanced applications, such as decentralized exchanges. wait. Ethereum is designed to solve the problem of insufficient scalability of Bitcoin.

The design of Ethereum incorporates many principles:

Principle of conciseness

The Ethereum protocol will be as simple as possible, even at the expense of some data storage and time inefficiencies. An ordinary programmer can also perfectly implement the complete development specification. This will ultimately help reduce the influence that any particular individual or elite group may have on the protocol and advance Ethereum's prospects as a protocol that is open to all. Optimizations that add complexity will not be accepted unless they provide a very fundamental benefit.

general principles

Having no "features" is a fundamental part of Ethereum's design philosophy. Instead, Ethereum provides an internal Turing-complete scripting language for users to build any precisely defined smart contract or transaction type. To build a full-scale Daemon or Skynet, you might need a few thousand interlocking contracts and be sure to feed them generously, anything is possible.

modular principle

The different parts of Ethereum should be designed to be as modular and divisible as possible. During development, it should be easy to make a small change somewhere in the protocol while the application layer continues to function without change. Ethereum development should maximize these things to benefit the entire cryptocurrency ecosystem, not just itself.

principle of non-discrimination

Protocols should not actively attempt to limit or hinder specific categories or usages, and all regulatory mechanisms in the protocol should be designed to directly regulate harms and should not attempt to oppose specific undesirable applications. One can even run an infinite loop script on Ethereum, as long as he is willing to pay transaction fees calculated by computational steps for it.

Of course, the functions of Ethereum also have its uniqueness and unlimited development space.

To put it simply, Ethereum is a platform that provides various modules for users to build applications. If building an application is like building a house, then Ethereum provides modules such as walls, roofs, floors, etc. Users only need to build Build a house like building blocks, so the cost and speed of building applications on Ethereum are greatly improved.

Specifically, Ethereum builds applications through a Turing-complete scripting language (EVM for short), which is similar to assembly language. We know that it is very painful to program directly in assembly language, but the programming in Ethereum does not need to use EVM language directly, but high-level languages ​​such as C language, Python, Lisp, etc., and then converted into EVM language through a compiler.

The applications on the platform mentioned above are actually contracts, which is also the core of Ethereum.

The contract is an automatic agent living in the Ethereum system. He has his own Ethereum address. When the user sends a transaction to the address of the contract, the contract is activated, and then according to the additional information in the transaction, The contract will run its own code and finally return a result, which may be another transaction sent from the contract address.

It should be pointed out that a transaction in Ethereum is not just about sending Ether, it can also embed quite a lot of additional information. If a transaction is sent to a contract, this information is very important, because the contract will complete its own business logic based on this information.

The business that the contract can provide is almost endless, and its boundary is your imagination, because Turing's complete language provides complete degrees of freedom, allowing users to build various applications.

However, until now, Ethereum has had many negative controversies.

Some market participants pointed out that crowdfunding projects on the Ethereum platform still have many risks.

First of all, Ethereum is not a decentralized digital currency. There is a giant and holds more than 80% of the currency value, and it has not moved, which is equivalent to a sharp knife hanging above the head of every currency citizen;

Secondly, the crowdfunding currency of Ethereum will be lifted in 4-5 rounds and needs to be realized, so the more crowdfunding projects, the greater the pressure to lift the ban;

The financing effect of the third crowdfunding fund, each crowdfunding needs ten times and a hundred times the Ethereum digital currency to wait for financing, instead of participating in the transaction, after the crowdfunding is over, this part of the currency will re-enter the market to suppress;

The fourth crowdfunding fund participates in making profits. The purpose of crowdfunding funds is to make profits. The Ether is not actively participating in crowdfunding but selling it, and then waits for the currency value to drop before buying it and returning it to users. This is the standard "Short profit";

Fifth, all the crowdfunding projects of Ethereum have not established the currency status of Ethereum, but deducted in the form of points and transaction taxes, which is equivalent to the nature of Taobao coins and Tmall points, which can be offset but It can never replace the function of currency.

Of course, this is only the personal opinion of some people.

What do you think about Ethereum?