The goal of Ethereum is to develop an alternative protocol for building decentralized IT applications, with a different set of compromises that we believe will be very useful for many decentralized applications, with particular emphasis on situations where rapid development time, safety for small and rarely used applications, and the ability of different applications to communicate very efficiently, are important.
Ethereum does this by building what is essentially the ultimate abstract base layer: a blockchain with a built-in complete Turing programming language, with which everyone can write smart contracts and decentralized applications where they can determine their own arbitrary rules for ownership, transaction formats and state transition functions. A ‘bare-bones’ version of Namecoin can be written in two lines and other protocols such as currencies and reputation systems can be built from fewer than twenty lines.
Smart contracts, cryptographic “boxes” that contain a value and only unlock if certain conditions are met, can also be built on top of the platform, with a lot more power than that offered by Bitcoin scripting because of the added properties of the completeness of the Turing Complete model, value consciousness, blockchain awareness and state.
Although all blockchains have the ability to process code, most are very limited. Ethereum is different. Instead of giving a series of limited edits, developers can make all the desired edits with Ethereum. This means that developers can build thousands of different applications that go far beyond what we have ever seen.
Visualisation Ethereum against world fiat currencies.