My last post around this subject was Blockchain. That is the technology behind the scenes introduced by bitcoin. It is a mark of a new era. This post will talk about something I can say the second step of this new era or the first step that uses the benefits introduced by the bitcoin, the Ethereum.

Definitions

What is: Ethereum is an open-source, public, blockchain-based distributed ledger featuring smart contract functionality. It enables developers to build blockchain applications with business logic that execute in a trustless environment, while leveraging the high availability of the Ethereum network. [1]

Highlights: decentralized, transparent, open source, programmable, ETH is the currency, turing-complete. [2].

Benefits: Immutability, Secure, Zero downtime.

Smart Contracts:While the word "contract" brings to mind legal agreements; in Ethereum "smart contracts" are just pieces of code that run on the blockchain and are guaranteed to produce the same result for everyone who runs them. [3]

Token:A token can be defined as something that serves as a visible or tangible representation of something else. ERC20 tokens are by far the most used token on Ethereum. The ERC20 standard is a specification that makes it easy to add ERC20 compliant tokens to a service or smart contract. [4].

Proof of Stake:Proof of Stake (PoS) is a category of consensus algorithms for public blockchains that depend on a validator’s economic stake in the network. In proof of work (PoW) based public blockchains, the algorithm rewards participants who solve cryptographic puzzles in order to validate transactions and create new blocks [5].

Decentralized Apps (Dapps): Any good, service, governance or economic activity can be decentralized and tokenized with and transacted via Ethereum. The token represents the dapp (an abbreviation for decentralized app) while it uses the Ethereum blockchain. One kind of application that is particularly intriguing is decentralized autonomous organisations (DAOs); this includes entities as large as, or even larger than nation-states, social networks, multinational public companies, etc.) [6].

Mining: Mining is the process of creating a block of transactions to be added to the Ethereum blockchain. Miners essentially process pending transactions and are awarded block rewards in the form of Ether, the Ethereum network's native currency, for each block generated. [7]. Miners produce blocks which the others check for validity. Among other well-formedness criteria, a block is only valid if it contains proof of work (PoW) of a given difficulty. Note that in Ethereum 1.1, this is likely going to be replaced by a proof of stake model. The difficulty dynamically adjusts so that on average one block is produced by the entire network every 12 seconds (ie., 12 s block time) [8].

Ethereum Virtual MAchine (EVM): The It is the runtime environment for smart contracts in Ethereum. Contracts live on the blockchain in an Ethereum-specific binary format (EVM bytecode).[9].

Gas: refers to the unit that measures the amount of computational effort required to execute specific operations on the Ethereum network. Since each Ethereum transaction requires computational resources to execute, each transaction requires a fee. Gas refers to the fee required to successfully conduct a transaction on Ethereum. Gas fees help keep the Ethereum network secure.[10].

Node: "Node" refers to a piece of software known as a client. A client is an implementation of Ethereum that verifies all transactions in each block, keeping the network secure and the data accurate. Running a node allows you to trustlessly and privately use Ethereum while supporting the ecosystem[11].

Accounts: Where ether is stored. Users can initialize accounts, deposit ether into the accounts, and transfer ether from their accounts to other users. Accounts and account balances are stored in a big table in the EVM; they are a part of the overall EVM state [12]. Types: Externally-owned – controlled by anyone with the private keys, Contract – a smart contract deployed to the network, controlled by code. Both account types have the ability to: Receive, hold and send ETH and tokens and Interact with deployed smart contracts [13]

Wallet: The interface / client / wrapper / holder that you use to manage your account(s).[13].

Public key: In Ethereum, the address "acts" like the public key, but it's not actually the public key[13].

Private Key: This is the string you need to send from your account. Without it you cannot access your funds.[13].

Keystore: Encrypted version of your private key in JSON format (though it does not have a JSON extension) [13].

MetaMask: MetaMask was created to meet the needs of secure and usable Ethereum-based web sites. In particular, it handles account management and connecting the user to the blockchain.[14].

Remix IDE: is an open source web and desktop application. Remix is used for the entire journey of contract development as well as being a playground for learning and teaching Ethereum. It is a powerful open source tool that helps you write Solidity contracts straight from the browser.[15].

TRUFFLE SUITE is a set of tools to run tests, execute commands, and inspect state while controlling how the chain operates.[16].

MyEtherWallet (MEW) is a free, open-source, client-side interface. MEW allows you to interact directly with the blockchain, while you remain in full control of your keys and funds.[17].


Smart Contract
How It Works
Gas
How to create an Ethereum Account

Who owns the brain that created it

Vitalik Buterin is one of the co-founders of Ethereum. Bellow two videos where he talks about that.

First Test

To start your first steps in ethereum you can use the rinkeby network. First of all is to install the MetaMask plugin. It allows the transactions from ethereum blockchain through regular websites. It uses a JavaScript library (web3.js) to make it possible. You can have more than one account.

The second step is to access the faucet rinkeby to require a temporary value of ethereum. You will need a tweeter or facebook account.

After that you are ready to test the transactions. Each one can be verified by rinkeby ethereum scan which will be available for you.

As an extra point of test you can create a wallet in MEW, select the rinkeby network and start the transactions between that and MetaMask address.

References