If you have any familiarity with Bitcoin, understanding the concept of Ethereum will be infinitely more feasible. If not, let us give you a little bit of insight. Both Bitcoin and Ethereum are what have become known as cryptocurrencies and operate on what is known as a blockchain. Through their own unique networks, transactions occur and are fundamentally based around currencies specifically designed to be used within the blockchain. The blockchain is nothing more than a ledger by which anyone, anywhere can see each and every transaction that has occurred from the beginning of time up until the present. This is something people love because it breeds transparency in that no shady dealings or secret transactions can ever take place because they are all public, recorded, and published.
Though these fundamental aspects of Ethereum and Bitcoin are similar, the similarities really stop beyond that.
From that first section, it sounds a lot like Ethereum and Bitcoin are two garments cut from the same cloth; and in many ways they are. But while Bitcoin exists as a means of strictly transferring value over the web, Ethereum exists as a platform for people to transfer/exchange literally anything over the web. Though there is a monetary aspect of Ethereum, it differs from Bitcoin in that it is not solely intended as a monetary exchange and trading platform. Put simply, Bitcoin is a monetary-based blockchain while Ethereum can be described as a general purpose blockchain.
Utilizing Ethereum, users and developers can create decentralized applications that are governed by smart contracts. Smart contracts are exactly like written contracts in that two or more parties enter into the agreement, which is plainly spelled out. If, for example, you wanted to create an application for the creation of legal documents, you, the writer, might spell out a contract with a developer that lays out the type of application being built and who is responsible for specific tasks. In order for anyone to create a contract and use the Ethereum network to host it, they must pay. The price paid for a contract depends upon many factors, including the number of members, the complexity, and so on. For extremely complex contracts, the fee is higher than it would be for one that was simple. On Ethereum, those wanting to enter into a contract pay a fee to the host of people who will host the smart contract, keep it alive, and ultimately enforce it. The currency paid out to these people is referred to as ether. What’s more, the contracts are governed Ethereum and not by any singular government or government organization.
In the end, the hope is that entering into agreements via Ethereum and the currency that governs it will become a viable alternative to seeking a lawyer and paying exorbitant costs in order to create an enforceable contractual agreement. In addition, Ethereum provides people who may reside in a part of the world where the legal system can best be described as unreliable a way to enter into agreements without fear of being taken advantage of.
Ethereum was first derived in a publication headed by a man named Vitalik Buterin, who himself was a developer who dealt with Bitcoin. Buterin first crafted Ethereum with the goal of creating a network of decentralized applications that worked in much the same way as the popular cryptocurrency Bitcoin.
Ethereum was first conceived in early 2014, and by the summer months a crowd-funding campaign had already gotten off its feet. In that same year, Buterin was presented with a World Technology Award for his new creation. Ethereum was launched and became live in July of 2015 and its ether currency quickly rose in value as people saw Ethereum as a way to do everything that bitcoin does and more. As opposed to solely transferring money from person to person, people were able to transfer all sorts of services and items.
Ethereum’s short history is not absent any controversy as a major hacking event which saw The DAO as its victim not only shattered the seemingly unflappable confidence people had in Ethereum, it also devalued ether considerably. The DAO is a platform of sorts where thousands of Ethereum’s smart contracts were being stored. When all was said and done, about $50 million worth of ether was stolen from The DAO and some serious security concerns were raised. Ethereum has since worked its way through many of these concerns and continues to grow, but just as it was in the early days of Bitcoin, there have been some turbulent times.
At this point, you will find almost no online casinos utilizing Ethereum or, more specifically, ether. The reason for this is due to the simple fact that ether cannot operate outside of the Ethereum platform. This means that in order for a real money Ethereum online casino to exist, it must be created within Ethereum. Unlike existing websites who have simply tailored their banking methods to accept bitcoins, ether does not present them with such an option.
As Ethereum becomes more widely known and, more importantly, more widely used, the widespread belief is that the existence of online casino applications is more of an inevitability than anything else. For now, however, cryptocurrency enthusiasts will find that it is incredibly simple and straightforward to convert ether into BTC. Many exchanges exist such that you can quickly exchange ether for BTC and vice versa. Many of these same exchanges also offer you the ability to change ether into any traditional currency such as USD or Euros as well.