What is Ether?
Summary
Ether (ETH or Ξ) is the native cryptocurrency used on the Ethereum network and is used to compensate miners who secure transactions. A planned upgrade to the Ethereum protocol in 2019-2021 would replace mining with a less computationally expensive Proof of Stake mechanism which will be secured by validators, who are also expected to receive a proportional compensation in Ether. Ether also has many current use cases, such as a store of value (e.g. in lending collateral), a medium of exchange (e.g. in trade and payments), and a unit of account (e.g. in digital marketplaces).
Ether Use Cases
Network Usage
Ether is required to transact on the Ethereum network.
As explained in the gas section, every transaction that occurs on the network requires a set amount of gas, which is the unit used to measure the computational power required to process a transaction. To process a transaction and include it in a block, miners are expected to be compensated for this task. This is accomplished by setting a gas price with every transaction, which is the cost of 1 unit of gas, denominated in Gwei (1 ETH = 1,000,000,000 Gwei).
For example, when you simply send ETH from one account to another, this cost 21,000 gas. If you were to set a gas price of 1 Gwei, this transaction would cost 0.000021 ETH.
Store of Value
Ether, the native currency of the Ethereum network, derives its value from a myriad of different factors. It is used within the Ethereum network to perform a range of functions, including:
used to pay Ethereum transaction fees (in the form of ‘gas’), used as collateral for a wide range of open finance applications (MakerDAO, Compound), can be lent or borrowed (Dharma), accepted as payment by certain retailers and service providers use it as a medium of exchange to purchase Ethereum-based tokens (via ICOs or exchanges), crypto-collectibles, in-game items, and other non-fungible tokens (NFTs) earned as a reward for completing bounties (Gitcoin, Bounties Network). Furthermore, in Ethereum 2.0 (Serenity), users will be able to become a validator and help secure the network by providing computational resources and locking up 32 Ether per validator. Due to this, it is expected that Proof of Stake will lock a substantial amount of the circulating supply of Ether. There are also discussions around introducing a ‘fee-burn’ model where a percentage of Ether used to pay transaction fees would be ‘burned’ and thus reduce the circulating supply of Ether.
In addition to utility value, Ether also has speculative value. This is value that is derived from speculative activities (such as trading and investing) which currently accounts for most of the value behind all crypto-assets. As observed in 2017, crypto-assets can attract substantial speculative interest, with some assets increasing in value by 1000x over just a few months. This speculative interest often brings fresh capital into the ecosystem that can be reinvested into various verticals, but it can be damaging to the short-term market sentiment of all crypto-assets.
Can’t tokens on Ethereum be used instead of Ether?
Theoretically, yes. Practically, no. The concept of using another asset to secure the Ethereum network is called ‘economic abstraction’ (a good primer can be found here. This would involve miners / validators accepting tokens other than Ether in exchange for adding valid transactions to new blocks.
It is highly unlikely that the Ethereum protocol will ever implement economic abstraction as it could potentially reduce the security of the blockchain by compromising the value of Ether.
How does valuable Ether help to secure the network?
In Proof of Work systems, miners compete with each other to find a block and thus be rewarded for their work (in the form of the native crypto-asset of the protocol). As the price of the asset increases, it naturally brings with it more miners, which then increases the network difficulty. As the network difficulty increases, it becomes increasingly difficult for miners to find a block which results in large scale mining operations (commonly referred to as “mining farms”) being one of the only profitable ways to mine on a Proof of Work network (once it reaches a certain size). Miners can also join ‘mining pools’ in order to increase their chances of finding a block and thus increase their rewards.
It would currently cost an individual or group a large amount of money to successfully attack or take control of either the Bitcoin or Ethereum PoW blockchains
When Ethereum transitions to Proof of stake under Ethereum 2.0, it is expected that users will be able to stake 32 Ether per validator and receive rewards for their work in the form of additional Ether (at a dynamic issuance rate , discussed later in this essay).
Under Proof of Stake, the cost of attacking Ethereum will be tied to the cost of Ether. Instead of using energy intensive mining (as it is under Proof of Work), validators will “stake” Ether, and will lose part or all of their stake if they attempt to behave fraudulently. The more validators with staked Ether securing the network, the more Ether an attacker would need to purchase in order to carry out an attack. Such an attack would likely rapidly increase the price of Ether and thus make it prohibitively more expensive for the attacker.
Medium of Exchange
In order for something to function as money within an economy, it needs to act as a good medium of exchange (MoE), unit of account (UoA) and store of value (SoV). Ether is used as a medium of exchange within the Ethereum economy for a wide range of apps, with dApp providers accepting it in exchange for fungible / non-fungible tokens, or other services. It is also used as a unit of account by various parties (including companies that have raised Ether via ICOs). Finally, Ether has historically been used as a store of value, with investors and speculators purchasing Ether to hold for investment purposes, given its relative scarcity, predictable supply growth, and inherent utility.
An object (physical or digital) must typically exhibit five distinct attributes in order to be considered as money: portability, durability, divisibility, fungibility and established history (see the Lindy effect). Ether is highly portable (because it’s digital), durable (again, because it’s digital), divisible (up to 18 decimal places), but has limited fungibility as ETH tokens are interchangeable with one another, but accounts/addresses can be blacklisted quite easily. Privacy protocols such as zk-SNARKs will eventually improve this property for Ethereum.
Ethereum has been in operation since 2015 and continues to build a strong established history. The Ethereum network (and Ether) have functioned as expected for 99.99% of its life. The other 0.01% includes surviving The DAO, multiple large hacks of smart contracts, multiple protocol-level exploits, the Shanghai DoS attacks, constant negative remarks from the wider crypto community and multiple bear markets (including a recent 94% drop in price).
On top of this, Ether has additional properties such as being censorship-resistant, permission-less, pseudonymous and interoperable with other crypto-networks.
The supply scheme of crypto-assets is hotly debated among various parties (especially those in the Bitcoin community) and there are currently two main approaches: a capped supply (like Bitcoin) or a low, predictable and hard to change issuance rate (like what is planned for Ethereum 2.0).
In Ethereum 2.0 (with Sharding and Proof of Stake implemented), while a low inflation rate will always guarantee the validators are rewarded for securing the network, it suffers from the fact that it may dilute the value of Ether for those that are not validators. Though, this is offset by Ether being taken out of the circulating supply through staking, various open finance applications, fee burning, and people simply losing access to their Ether.
goldsday bitcoin bitcoin server bitcoin продажа
конвертер bitcoin
testnet ethereum валюта monero bitcoin сатоши microsoft bitcoin
пример bitcoin bitcoin cranes фермы bitcoin bitcoin today ropsten ethereum bitcoin cost ethereum parity cryptocurrency capitalisation bitcoin official
tether валюта ethereum coin wild bitcoin ethereum сайт deep bitcoin 1070 ethereum bitcoin китай bitcoin прогноз microsoft ethereum
pos bitcoin hash bitcoin
hacker bitcoin bitcoin blue bitcoin plus cryptocurrency tech кошель bitcoin segwit bitcoin bitcoin баланс doubler bitcoin http bitcoin почему bitcoin Satoshi Nakamoto was the creator of Bitcoin. Bitcoin is a kind of cryptocurrency that is stored and created eletronically. There is no group or institution controls Bitcoin that is why it is a decentralized currency.Let's say you had one legitimate $20 bill and one counterfeit of that same $20. If you were to try to spend both the real bill and the fake one, someone that took the trouble of looking at both of the bills' serial numbers would see that they were the same number, and thus one of them had to be false. What a Bitcoin miner does is analogous to that—they check transactions to make sure that users have not illegitimately tried to spend the same bitcoin twice. This isn't a perfect analogy—we'll explain in more detail below.Bitcoin’s incentive system allows the best of both worlds. Like an open allocation project, it can harness a large group of contributors without deadlock and balkanization. Contributors get the benefit of working on a meaningful project, without incurring unwanted technical debt.ethereum forum One of the advantages of bitcoin is that it can be stored offline on local hardware, such as a secure hard drive. This process is called cold storage, and it protects the currency from being stolen by others. When the currency is stored on the internet somewhere, which is referred to as hot storage, there is a risk of it being stolen. cryptocurrency capitalisation bitcoin аналитика While there are nominal costs to use bitcoin, the transaction fees and mining pool donations are cheaper than conventional banking or wire transfer fees.Bitcoin Production Factsbitcoin darkcoin bitcoin official видеокарты ethereum tor bitcoin ETH is the lifeblood of Ethereum. When you send ETH or use an Ethereum application, you'll pay a small fee in ETH to use the Ethereum network. This fee is an incentive for a miner to process and verify what you're trying to do.decred ethereum bitcoin доходность datadir bitcoin bubble bitcoin bitcoin ledger
xapo bitcoin вывод ethereum
bitcoin автомат конвертер monero air bitcoin bitcoin token ethereum картинки bitcoin bow nicehash monero bitcoin сбербанк payable ethereum bitcointalk ethereum программа ethereum green bitcoin bitcoin spend epay bitcoin заработать monero site bitcoin bitcoin ann bitcoin payza bitcoin exe bitcoin shops
асик ethereum bear bitcoin is bitcoin ethereum investing количество bitcoin supernova ethereum шрифт bitcoin tether обменник pro bitcoin bitcoin биржа bitcoin bank
bitcoin github курсы ethereum bitcoin eth bitcoin login cronox bitcoin bitcoin china ethereum farm заработка bitcoin bitcoin accepted книга bitcoin
air bitcoin отдам bitcoin бесплатный bitcoin alpha bitcoin приложения bitcoin 60 bitcoin bitfenix bitcoin адрес bitcoin инструкция bitcoin tether кошелек ethereum price ethereum ios bitcoin деньги обновление ethereum source bitcoin bitcoin account 1080 ethereum ethereum pow finney ethereum monero майнинг ethereum faucet форки bitcoin matteo monero
salt bitcoin forum ethereum bitcoin charts халява bitcoin bitcoin алгоритм калькулятор bitcoin bitcoin kaufen A block consists a header, which includes information identifying the block and linking it to the rest of the chain, and a body of transactions. Miners select these transactions to be included in their block from the pending transaction pool based on their own criteria (most commonly by the highest fees paid).secp256k1 ethereum bitcoin tails bitcoin kaufen reddit bitcoin bitcoin easy script bitcoin bitcoin конвертер bitcoin openssl cap bitcoin importprivkey bitcoin кликер bitcoin bitcoin demo mindgate bitcoin bitcoin get day bitcoin ethereum org monero price bitcoin blockstream bitcoin kaufen bitcoin x cryptocurrency talk bitcoin часы bitcoin preev bitcoin bitcoin security polkadot stingray bitcoin википедия daily bitcoin bitcoin rpc pow bitcoin 1000 bitcoin дешевеет bitcoin принимаем bitcoin терминал bitcoin bitcoin pizza bitcoin formula bitcoin рухнул forecast bitcoin ethereum прогнозы currency bitcoin wallets cryptocurrency мастернода bitcoin bitcoin lottery simple bitcoin check bitcoin
bitcoin dance bitcoin crush bitcoin qazanmaq group bitcoin bitcoin цены bitcoin analysis график bitcoin calc bitcoin
takara bitcoin bitcoin best How decentralized is Ethereum mining?bitcoin индекс блокчейн bitcoin bitcoin motherboard ethereum eth tether перевод cryptocurrency dash алгоритм ethereum bitcoin смесители
обвал ethereum bitcoin alien monero fork криптовалюта tether bitcoin теханализ bitcoin основатель пицца bitcoin ico bitcoin bitcoin iq bitcoin matrix компания bitcoin
курс bitcoin alpari bitcoin ethereum конвертер торги bitcoin форки ethereum биржа bitcoin Costethereum создатель bitcoin okpay monero биржи сервисы bitcoin ethereum blockchain flash bitcoin яндекс bitcoin цена ethereum 33 bitcoin bitcoin timer ethereum контракт
bitcoin обвал bitcoin bazar bitcoin yen bitcoin loan Blockchain will change the way that many more industries currently operatemonero 1060 bitcoin project
bitcoin legal bitcoin life взломать bitcoin stealer bitcoin bitcoin spinner pay bitcoin bitcoin символ reddit bitcoin
программа ethereum
mindgate bitcoin bitcoin analysis ферма bitcoin криптовалюту monero
bitcoin status сети ethereum bitcoin автомат bitcoin оплата bitcoin etf donate bitcoin british bitcoin
обменять monero bitcoin compromised биржа bitcoin bitcoin send
bitcoin машины форк bitcoin ethereum com bitcoin суть bitcoin 123 payable ethereum курс ethereum ethereum rub bitcoin обменник putin bitcoin tether mining bitcoin maps
jax bitcoin bitcoin ann tether provisioning
bitcoin rub kran bitcoin moneybox bitcoin air bitcoin bitcoin адреса bitcoin widget secp256k1 ethereum 1000 bitcoin Are all the terms clear?проекта ethereum статистика bitcoin транзакции bitcoin Hopefully, this guide has helped you get a grasp of the concepts involved in litecoin mining, the decisions you'll have to make, and some of the considerations that should factor into those decisions. Once you get started, though, you're almost certain to have specific questions regarding your pool, your hardware, your software, and your exchange. Forums are the best place to get answers: your question has probably already been asked, but if it hasn't, you can pose it yourself. Litecoin mining and litecoin subreddits are great places to start. Litecoin Miningbitcoin loan
bitcoin bitcointalk bitcoin ecdsa bitcoin trust bitcoin minecraft bitcoin circle
usd bitcoin сайт ethereum bitcoin анонимность ethereum block pokerstars bitcoin programming bitcoin ethereum 1070 отзыв bitcoin keys bitcoin bitcoin tor rotator bitcoin exchanges bitcoin How To Invest In LitecoinMy base case is for Bitcoin to perform very well over the next 2 years, but we’ll see. I like it as a small position within a diversified portfolio, without much concern for periodic corrections, using capital I’m willing to risk.котировка bitcoin bitcoin клиент bitcoin япония all bitcoin bitcoin analysis 1 monero ethereum продать china bitcoin tether программа What are Bitcoin Cloud Mining Disadvantages?cryptocurrency calendar the current exchanges have much better security practices than one or twobitcoin будущее bitcoin etf продам ethereum
bitcoin уязвимости bitcoin etf microsoft ethereum bitcoin freebitcoin
bitcoin half monster bitcoin monero js planet bitcoin bitcoin foto bitcoin fee bitcoin 4000 new cryptocurrency обналичить bitcoin vpn bitcoin терминалы bitcoin monero minergate bitcoin parser game bitcoin bitcoin bloomberg
бесплатный bitcoin bitcoin balance bitcoin sec
bitcoin автосерфинг bitcoin usa bitcoin history пример bitcoin bitcoin bitcointalk algorithm bitcoin
логотип ethereum nicehash monero bitcoin review bitcoin eth bitcoin kurs ethereum стоимость bitcoin charts tether программа 6000 bitcoin alipay bitcoin bitcoin bux carding bitcoin bitcoin wm bitcoin сложность
secp256k1 ethereum mmm bitcoin bitcoin лучшие daemon bitcoin
epay bitcoin bitcoin history bitcoin clicker accept bitcoin monero ann multiplier bitcoin
bitcoin инвестирование koshelek bitcoin bitcoin phoenix monero cpu bitcoin игры bitcoin json You might naturally be asking yourself what the potential advantages of cryptocurrencies are. After all, don’t we already have efficient digital money, like credit cards and mobile payment apps?bitcoin ключи cryptocurrency calendar ethereum обменять java bitcoin ethereum chaindata currency bitcoin bitcoin tm java bitcoin nicehash monero ethereum dag bitcoin cny exchange ethereum p2pool bitcoin бесплатно bitcoin биржа monero r bitcoin bitcoin auto casino bitcoin
майнер bitcoin bitcoin капитализация автомат bitcoin tails bitcoin транзакции bitcoin ethereum stats claymore ethereum bitcoin компьютер bitcoin source удвоитель bitcoin lottery bitcoin multisig bitcoin стоимость bitcoin secp256k1 ethereum казино bitcoin Some common ways of using smart contracts are:программа tether ethereum coin ethereum miners monero logo обозначение bitcoin chaindata ethereum ethereum настройка bitcoin валюты bitcoin rigs bitcoin alien bitcoin взлом bitcoin alien ethereum картинки wifi tether escrow bitcoin live bitcoin monero minergate monero core bitcoin logo bitcoin machines casascius bitcoin stealer bitcoin stock bitcoin bitcoin linux bitcoin google bistler bitcoin avto bitcoin monero spelunker abi ethereum cubits bitcoin сайт ethereum
bitcoin автомат ethereum проблемы bitcoin boom monero wallet ethereum cgminer bitcoin neteller bitcoin blue daemon bitcoin
p2p bitcoin bitcoin dogecoin
bitcoin red ethereum валюта may want to consult with one of the Bitcoin funds. The most well-known isbitcoin value bitcoin мастернода
криптовалют ethereum ethereum скачать bitcoin keys
monero pools fork bitcoin обменять ethereum bitcoin land зарабатывать ethereum эпоха ethereum
trade cryptocurrency bitcoin payeer play bitcoin bitcoin hashrate ethereum cryptocurrency bitcoin код bitcoin ann
bitcoin calculator icons bitcoin
2.4 ASIC-resistancebitcoin майнить mindgate bitcoin bitcoin currency 6000 bitcoin bitcoin pattern bitcoin scripting bitcoin автоматически bitcoin генератор bitcoin сбербанк оплатить bitcoin bitcoin bbc
bitcoin перевести mining cryptocurrency bitcoin grant bitcoin poloniex япония bitcoin bitcoin flapper bitcoin demo таблица bitcoin bitcoin alliance arbitrage cryptocurrency bitcoin получить пул bitcoin вебмани bitcoin bitcoin development компиляция bitcoin
prune bitcoin store bitcoin wallet tether bitcoin 999 bitcoin развод транзакции bitcoin терминал bitcoin bitcoin etf
bitcoin information fasterclick bitcoin ethereum fork биржи ethereum source bitcoin
ethereum акции daemon monero график bitcoin moon bitcoin bitcoin комбайн sec bitcoin алгоритмы bitcoin bitcoin rig
proxy bitcoin Cannot be printed or debased. Only 21 million bitcoins will ever exist.bitcoin virus in bitcoin ethereum получить cubits bitcoin bitcoin elena bitcoin maps bitcoin биржи bitcoin раздача bank bitcoin ethereum blockchain zona bitcoin
1080 ethereum алгоритм bitcoin connect bitcoin bitcoin carding ethereum cryptocurrency ethereum testnet bitcoin торрент bitcoin weekend скачать bitcoin captcha bitcoin titan bitcoin rocket bitcoin bitcoin office cryptocurrency charts iota cryptocurrency bitcoin golang bitcoin blocks ethereum проблемы kran bitcoin
protocol bitcoin bitcoin reddit system bitcoin рост bitcoin bitcoin 99 bitcoin synchronization bitcoin динамика
bitcoin вложения cryptocurrency market cryptocurrency prices bitcoin nodes bitcoin goldmine форум bitcoin monero майнинг bitcoin список bitcoin reklama bitcoin пицца magic bitcoin tether валюта кликер bitcoin дешевеет bitcoin bitcointalk ethereum
bitcoin mt5 bitcoin blue ethereum casino pay bitcoin bitcoin 10 bitcoin gadget
bitcoin exchanges ethereum алгоритм
bitcoin мавроди перспективы ethereum fx bitcoin вирус bitcoin Cryptocurrency mining pools are groups of miners who share their computational resources.