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I'm new to Ethereum. The way I see it, the catch of Ethereum is that everything is decentralized so dapps are transparent and users can be sure of how their information is being used, that their money goes to the right places, and that certain conditions are met in order for a procedure (a.k.a. Smart Contracts) to proceed. Basically it's a completely transparent system that no one party owns so we can be sure that everything is peer to peer. Is this correct?

So lets say I build a Facebookthereum (Facebook on Ethereum). Why would anyone use that over Facebook itself? I don't believe users care enough about their privacy to ditch the mainstream applications. Ethereum feels like a hard sell that only focus on implementation details that users don't really care about. They just want pretty UX / UI, and a working app. Sure Facebook uses my demographic info to generate ads and stuff, but does it really bother me that much? Not really.

So how is Ethereum so revolutionary? I could see it used but only for a limited amount of things mostly related to money like how Augur does event betting. In the betting space, you want to make sure you get your money if you win, etc. But I don't see how it could replace all of the huge corporations or how any non-money related apps would make money.

Please enlighten me!!

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The Facebook example about privacy might be incorrect, because their information won't be private, if stored on the blockchain unencrypted. Well, it could be encrypted and stored in IPFS / Swarm.

What is important is that the users will own their own data and will be able to choose what platform is used, and how is used, like Facebookthereum.

Needless to say, Facebook is not going to go anywhere, but in this scenario, the user will allow them to use their data.

A better example will be companies that rely on selling and building user reputation. Uber, eBay will be good examples.

These 2 companies provide an insurance system, that is charged to the end buyer with fees to the seller.

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Not directly money, but Ethereum can be used to reduce fraud by intermediaries when distributing aid/welfare (e.g.,m http://www.coindesk.com/united-nations-sends-aid-to-10000-syrian-refugees-using-ethereum-blockchain/). Other uses could include digital access tracking (e.g., providing access to a hotel room that expires after a certain amount of time), voting/membership for a co-operative, and increasing corporate accountability by establishing a chain of trust between companies to the consumer (e.g., https://www.provenance.org/whitepaper).

Why not use multiple non-distributed applications? You could -- and you could also have multiple purpose-built blockchains -- but perhaps it's more convenient to have a unified backbone that allow all those services to interoperate. When you go to the grocery store, instead of having to use Grocery Store dollars, you can use the money your country uses. Something like Ethereum enables you to attach a common monetary system to actions: you can do things like reward users for voting to increase political participation or to do things like automated toll collection. You may have also noticed a shift to different websites using things like GitHub accounts to authenticate users rather than creating yet another account. These are examples where we see the benefits of standardization.

I don't think Ethereum is a replacement for corporations just like how legal documents don't replace people. Ethereum isn't a cure-all. It's merely one more tool people have to solve problems they encounter.

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