Blockchain History
Chapter 5 of 13
Chapter 5: Ethereum and Smart Contracts—Dawn of the World Computer
How Vitalik Buterin created Ethereum, opening the blockchain 2.0 era and the smart contract revolution
Key Takeaways
- Vitalik Buterin proposed Ethereum in late 2013 as a general-purpose blockchain platform that could run arbitrary programs, not just a currency.
- Ethereum introduced the concept of a world computer — a Turing-complete virtual machine (EVM) that executes smart contracts on a decentralized network.
- Nick Szabo coined the term 'smart contract' in 1994, but Ethereum was the first platform to make self-executing agreements practical at scale.
- The Ethereum crowdsale in July–August 2014 raised approximately 31,500 BTC (~$18.3 million), one of the largest crowdfunding events at the time.
- Token standards such as ERC-20 turned the EVM into shared infrastructure, and the resulting ecosystem became the foundation for DeFi, NFTs, and Web3.
Overview
How Vitalik Buterin created Ethereum, opening the blockchain 2.0 era and the smart contract revolution
Why This Chapter Matters
Ethereum transformed blockchain from a single-purpose payment network into a programmable platform. By enabling smart contracts, it unlocked entirely new categories of decentralized applications and spawned the DeFi, NFT, and Web3 movements.
Frequently Asked Questions
Who created Ethereum?
Ethereum was proposed by Vitalik Buterin in late 2013 and co-founded by Vitalik Buterin, Gavin Wood, Joseph Lubin, Charles Hoskinson, Anthony Di Iorio, Mihai Alisie, Amir Chetrit, and Jeffrey Wilcke. Gavin Wood authored the Ethereum Yellow Paper defining the EVM specification.
How is Ethereum different from Bitcoin?
While Bitcoin is primarily a digital currency and store of value, Ethereum is a programmable blockchain platform. Ethereum's Turing-complete virtual machine allows developers to deploy smart contracts — self-executing programs that can implement complex logic like financial protocols, games, and governance systems.
What is a smart contract?
A smart contract is a self-executing program stored on a blockchain that automatically enforces the terms of an agreement when predefined conditions are met. Nick Szabo described the concept in 1994; once deployed on Ethereum, the code runs exactly as written without censorship, downtime, or third-party interference.
What is the Ethereum Virtual Machine (EVM)?
The EVM is a sandboxed runtime environment that executes smart contract bytecode on every Ethereum node. It provides a deterministic, Turing-complete execution environment, meaning any computable program can run on it. The EVM has become a de facto standard, with many other blockchains implementing EVM compatibility.
What is the ERC-20 token standard?
ERC-20 is a technical standard for fungible tokens on Ethereum, proposed by Fabian Vogelsteller in November 2015. It defines a common set of rules every token contract must follow, which is what allows wallets, exchanges, and DeFi protocols to support new tokens without custom integration work.