Ethereum is a decentralized platform that runs smart contracts: applications that run exactly as programmed without any possibility of fraud or third party interference.

These apps run on a custom built blockchain, an enormously powerful shared global infrastructure that can move value around and represent ownership of property. This enables developers to create markets, store registries of debts or promises, move funds in accordance with instructions given long in the past (like a will or a futures contract) and many other things that have not been invented yet, all without a middleman or counterparty risk.

The project was bootstrapped via an ether pre-sale during August 2014 by fans all around the world. It is developed by the Ethereum Foundation, a Swiss non-profit, with contributions from great minds across the globe.

Ethereum is often described as a digital currency but here’s something important to keep in mind: Ethereum is much more than that. It’s a decentralized platform that runs smart contracts.

These smart contracts are applications that run exactly as programmed without any possibility of fraud or third party interference.

What does this mean? Well, imagine you wanted to buy a house. You could go through a traditional real estate agent and hope everything goes smoothly. Or you could use a smart contract on the Ethereum blockchain. With a smart contract, you could set up the entire transaction on the blockchain.

This means that once you and the seller agree on the price, the contract is executed and the house is sold – all without having to go through a third party. And because the transaction is on the blockchain, it’s secure and cannot be tampered with.

This same concept can be applied to anything from lending platforms to supply chain management to voting systems and beyond. The possibilities are endless.

And because Ethereum is open source, anyone can build on top of it and create their own decentralized applications.

Ethereum is often compared to Bitcoin because they are both cryptocurrencies. But there are actually quite a few differences between them. For one thing, Ethereum’s main purpose isn’t to be used as a currency like Bitcoin. Instead, it’s meant to be used as a platform for running decentralized applications (dapps).

And while you can use Ether (the cryptocurrency of Ethereum) to make transactions, most people don’t actually do that – they use it to power transactions on dapps instead. In other words, while Bitcoin is primarily used as a digital currency, Ethereum is used as a platform for running decentralized applications.

Another key difference between Bitcoin and Ethereum is that while Bitcoin has a limited number of tokens (21 million), there is no limit to the number of Ether tokens that can be created. This is because Ether isn’t meant to be used as a currency like Bitcoin – it’s meant to be used as “gas” or “fuel” for running dapps on the Ethereum network.

So while there will only ever be 21 million Bitcoins in existence, there can theoretically be an unlimited number of Ether tokens (although in practice, there will probably only ever be around 100 million).

So what does this all mean? Is Ethereum a good investment? While it certainly has potential, it’s important to remember that it’s still early days for Ethereum (and for blockchain technology in general). So if you’re thinking about investing in Ethereum (or any cryptocurrency for that matter), it’s important to do your research and understand both the risks and the potential rewards before making any decisions.