How does Ethereum work?

Ethereum is a decentralized platform that runs smart contracts: applications that run exactly as programmed without any possibility of downtime, censorship, 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 the 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 Ethereum platform itself is featureless or value-agnostic.

Similar to programming languages, it is up to entrepreneurs and developers to decide what it should be used for. However, it is important to note that certain application types benefit more than others from Ethereum’s capabilities. Ethereum’s core innovation, the Ethereum Virtual Machine (EVM) is a Turing complete software that runs on the Ethereum network.

It enables anyone to run any program, regardless of the programming language given enough time and memory. The EVM makes the process of creating blockchain applications much easier and efficient than ever before. Instead of having to build an entirely original blockchain for each new application, Ethereum enables the development of potentially thousands of different applications all on one platform.

At its simplest, Ethereum is an open software platform based on blockchain technology that enables developers to build and deploy decentralized applications. On Ethereum, you can write code that controls digital value, runs exactly as programmed, and is accessible anywhere in the world.