Ethereum is a public blockchain, with its own cryptocurrency, called Ether, or Ethereum.
Whereas Bitcoin stores a list of balances and transactions on its blockchain, the Ethereum blockchain is designed to store different types of data. This data can be accessed and used by computer programs running on the Ethereum blockchain. These programs are called decentralized apps, or dapps.
Simply put, Ethereum is intended to be a world computer.
A little bit more detail
Ethereum (ETH) was conceived in 2013 by Vitalik Buterin, who was a developer working on Bitcoin at the time.
Buterin believed that Bitcoin should be made more customisable. That it should go a step further than simply being a store of wealth, and that it needed smart contract features to determine automatically when payments should occur, for example. The project wasn’t taken up for Bitcoin, so Buterin created Ethereum in 2014 for this purpose.
Ethereum has grown to become the second largest cryptocurrency by market capitalisation, after Bitcoin. A smart contract is essentially a program that runs on the Ethereum blockchain, and executes when predetermined conditions are met for funds to be unlocked and transferred.
The purpose of Ethereum is to become a platform on which smart contracts and decentralised apps can run. Unlike Bitcoin, where there’s a cap of 21 million Bitcoins that can ever be mined, Ethereum has no cap.
Ethereum aims to take the decentralised, secure, and open nature of blockchains and extend those to virtually anything that can be computed.
Tip
Keen to explore Ethereum a bit more? You can learn about Ethereum basics and get all the latest cryptocurrency news on Luno Discover.
Want to know how to buy, sell, send and receive your Ethereum? We’ve got answers in these help articles:
This information is not intended to be nor does it constitute financial, tax, legal, investment or other advice; nor is it a call to trade. The information is intended as general market commentary for information purposes only. Before making any decision or taking any action regarding your finances, you should consult a qualified Financial Advisor.