Because of all the excitement lately in the Blockchain space, I've been getting queried more frequently about Ethereum and how it differs from Bitcoin. Here's how I've been answering.
Why is it not Bitcoin?
Ethereum is more than just payments. It's a programmable blockchain. As a blockchain, it shares characteristics with Bitcoin: it's decentralized, trustless, and immutable. But it's unique in that it provides a general purpose computing language that enables developers to build financial services, games, and applications upon it. These are refered to as decentralized applications, or "Dapps".
Entertaining and insightful, Tim Ferris recently published a podcast interview with Ethereum's founder, Vitalik Buterim, and Naval Ravikant, a well-known investor. Tim does a great job keeping this one "beginner friendly".
So why now?
The buzz of the last year has been "Decentralized Finance", which is admittedly complicated. Ethereum's Introduction to Defi is a great place to start, and especially this doodle video:
As the video explains, there has been tremendous growth over the last year, with Ethereum settling over one trillion in transactions – that's more than Paypal.
What can we expect from this year?
There's a lot planned for 2021, and the "Eth 2.0" vision is compelling. A significant and long-planned technical upgrade (staking) is a massive step towards environmental sustainable. Another technical upgrade (rollups) is immanent, and will result in a hundred-fold increase in scaling. And finally, the 1559 proposal was recently adopted (and deployed!) providing security and user-experience improvements, while also increasing the scarcity of Ethereum, which could have economic implications.