Being the second largest cryptocurrency by market cap, Ethereum was founded in 2015 by Vitalik Buterin' (@VitalikButerin) on Twitter.
Let's kick start with the meaning of Ethereum.
A Thread 🧵…..
What is Ethereum?
Ethereum is a programmable blockchain where programmers can build software on to create valuable products and services.
Due to the decentralized feature of the Blockchain, the software that is built on the Ethereum Network is called Decentralized Applications (DApps) , which led to the creation of Decentralized Finance (Defi) .
Go through the thread to understand more about Defi: https://twitter.com/DeFibee_gurl/status/1569646155100823552?t=PARWp2NcO1QRThYqNbHLbg&s=19 .
How come the Ethereum Network is so organized and softwares is built on it without a centralized authority? ETHER.
What is Ether?
Ether can simply be defined as the local currency of the Ethereum Network. Ether was created as a form of payment to fuel the Ethereum Network. In layman's language, Ethereum is a programmable blockchain where softwares is built on, so in order for the builders to continue building without hassle and complaints,they are being paid Ether as a form of incentive to keep them working.
External software builders who want to build on Ethereum are to pay a particular amount of Ether in order to get space and computing power to be able to build whatever they are building and the price required of the software ware builder to pay I'd determined by a software feature known as GAS.
What is Gas?
Gas is a built in Ethereum feature that uses the Space- Bandwidth- Computational difficulty of each transaction to calculate the amount of fees that will cost for each transaction.
Gas was created to differentiate the cost of transactions (Transaction Fees) from the actual Ether currency. I'm n subject to this, gas prices are now denoted in GWEI. GWEI is the ninth unit of the Ethereum currency, with the smallest unit known as WEI.
How Ethereum Works:
•Hardware Layer: This is a peer 2 peer network of computers who compute transactions and place them in an orderly manner on the Blockchain digital ledger.
•Software Layer: An Ethereum software ledger is a part of the Ethereum network that has been built to allow the transaction of value no matter the form it comes through the help of smart contracts that is built by solidity programmers.
•Application Layers: This is the combination of the hardware and software layers where the third party applications can be executed.
Ethereum Request for Comments known as ERC-20 is known as a token standard which every token listed under the Ethereum network must follow before it can be listed.
•Ethereum is a programmable blockchain.
•Ether is the native currency of Ethereum.
•Gas is how transaction fees are calculated.
•The Ethereum network is made up of 3 layers, which makes operations in the network smooth.
•Erc-20 is a guideline that tokens go through before they are launched on the Ethereum network.
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