Ethereum wallet

Ethereum wallet has an inbuilt cryptocurrency Ethereum’s token is called Ether, shortened to ETH. This is a cryptocurrency that can be traded for other cryptocurrencies or other sovereign currencies, just like BTC. Its current value is around US$13 per ETH token (Oct 2016). Token ownership is tracked on the Ethereum blockchain, just like BTC ownership is tracked on Bitcoin’s blockchain, though at a technical level they track them in slightly different ways. For more on cryptocurrencies and tokens see a gentle introduction to digital tokens. How is Ethereum wallet different to Bitcoin? This is where it gets more technical and in many ways more complex. Ethereum’s block time is shorter In Ethereum wallet the time between blocks is around 14 seconds, compared with Bitcoin’s ~10 minutes. This means that on average if you made a Bitcoin transaction and an Ethereum transaction, the Ethereum wallet transaction would be recorded into Ethereum’s blockchain faster than the Bitcoin transaction getting into Bitcoin’s blockchain. You could say Bitcoin writes to its database roughly every 10 minutes, whereas Ethereum writes to its database roughly every 14 seconds. Ethereum has smaller blocks In Bitcoin, the maximum block size is specified in bytes (currently 1 MB) whereas Ethereum’s block size is based on complexity of contracts being run – it’s known as a Gas limit per block, and the maximum can vary slightly from block to block. Currently the maximum block size in Ethereum is around 1,500,000 Gas. Basic transactions or payments of ETH from one account to another (ie not a smart contract) have a complexity of 21,000 Gas so you can fit around 70 transactions into a block (1,500,000 / 21,000). In Bitcoin you currently get around 1,500-2,000 transactions in a block. Data-wise currently most Ethereum blocks are under 2 KB in size. The Ethereum Virtual Machine can run smart contracts Compared with Bitcoin’s primitive scripting language, the code that can be deployed in Ethereum and run as smart contracts is more advanced and familiar to developers. Smart contract code is run by something called the Ethereum Virtual Machine, which runs on the computers of all participants on the network. If you are familiar with Microsoft Excel macros (pieces of code run by Excel), then similarly smart contracts are pieces of code run by Ethereum’s Virtual Machine. In many descriptions, Ethereum smart contracts are called “Turing complete”. This means that they are fully functional and can perform any computation that you can do in any other programming language.