Editor’s Note: Chung is an Oursky Intern. After participating in our Smart Contract consulting project, he wrote this introductory article to catalog his learnings about the Ethereum network.
You must have heard of Bitcoin, the distributed currency system.
Bitcoin utilizes a technique called blockchain which stores all the transaction records. Blockchain also ensures that no malicious modifications could be applied to the records.
As a distributed system, Bitcoin utilizes machines on the whole network to compute and verify the changes on the records.
What if we go went beyond storing transaction records into program states? This makes the whole network a computer for general purpose computations with program states that no one can modify illegally. Ethereum does this.
Let me explain below.
What is missing from Bitcoin?
Bitcoin blockchain architecture has several problems for general purpose computations. They include network state dependency, Turing-completeness and block time.
Bitcoin only stores the transactions of coins in the blockchain. Therefore, the state of the network (implicitly constructed by transaction records) is just the amount of coins for each account. For general purpose computations, we need general purpose program states.