What is Ethereum? History of Ethereum, Smart Contracts, Ethereum Virtual Machines, Decentralized Applications, Disadvantages of Ethereum

1. Ethereum
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2. What is Ethereum?
Ethereum is a open-source decentralised blockchain network on which
decentralised applications can be built
● While Ethereum is the blockchain network, ETHER(ETH) is the
currency of the Ethereum ecosystem. ETH is used to pay transaction
fees on the network
● Ether is also the second largest cryptocurrency with a price of $3276
and a market capitalisation of $390 billion.
● The current circulating supply of Ether is 119 million. The total supply is
not defined.
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3. History of Ethereum
● Vitalik Buterin founded Ethereum when
he was 19 years old
● Ethereum ICO took place in 2014 raising
around 31,000 BTC which was around
$18 million at that time for ETH price at
$0.3
● In 2016, Ethereum main-net was
launched
● In a DAO attack in 2016, Ethereum chain
was forked in to Ethereum and
Ethereum Classic
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4. Smart Contracts
A smart contract is the agreement between the two people in the form of
computer code.
● Smart contracts execute automatically when the conditions of the
agreement are met
● Smart contracts facilitate the exchange of ETH, property, assets or
anything of value
● Smart contracts are written in Solidity
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5. Decentralized Applications
Decentralized applications or Dapps are applications that run on a
blockchain network or peer-to-peer network of computers instead of
relying on a single computer or a single server.
● Dapps are built using smart contracts
● Dapps can be built on blockchain networks like Ethereum, Polygon or
Solana
● Ethereum wallets like Metamask and Trust wallet facilitate the
interaction with dapps
● Opensea, Uniswap, Axie Infinity, DYDX are some popular Dapps
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6. Ethereum Virtual Machine
● Decentralized application are developed on Ethereum Virtual Machine
● Ethereum Virtual Machine(EVM) is the platform developers used to
develop and deploy Dapps on Ethereum
● EVM takes care of the functioning of the dapps using the
computational resources from the miners/nodes in the Ethereum
network
● EVM enables creation of thousands of applications on one platform
instead of creating new blockchain for every application
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7. What is Gas?
Gas is the fuel required to run
Ethereum.
Gas depends on the amount of
computation required for a given
transaction. Gas is paid in ETH
● Gas fees = Gas limit x Gas price
1 ETH = 10^18 wei
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8. Disadvantages of Ethereum
● Scalability – Ethereum is not a scalable network. As users of the
network increase, the transaction fees tend to go high resulting in
network congestion
● Not a good Store of Value – ETH is used as a fuel for the Ethereum
network. People use ETH only when there are decent dapps on the
network
● Dapps are prone to hacking as the smart contracts are only as good as
the person who programs them.
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Thank You
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