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    Ether:The Crypto-Fuel For The Ethereum Network

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    Paavni Jain
    Ether is the cryptocurrency fuel that powers the Ethereum network. It was first sold in a crowdsale in 2014 to fund the development of the Ethereum platform. Ether is required to pay for computations and transactions on the Ethereum network. New ether is created during the mining process, with a limited amount produced every block to incentivize miners. The future of ether and Ethereum is debated, but many experts are optimistic about the potential of the platform and its smart contract capabilities to revolutionize industries.

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    Ether:The Crypto-Fuel For The Ethereum Network

    Uploaded by

    Paavni Jain
    109 views11 pages
    Ether is the cryptocurrency fuel that powers the Ethereum network. It was first sold in a crowdsale in 2014 to fund the development of the Ethereum platform. Ether is required to pay for computations and transactions on the Ethereum network. New ether is created during the mining process, with a limited amount produced every block to incentivize miners. The future of ether and Ethereum is debated, but many experts are optimistic about the potential of the platform and its smart contract capabilities to revolutionize industries.

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    Block Chain

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    Block Chain

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    Ether is the cryptocurrency fuel that powers the Ethereum network. It was first sold in a crowdsale in 2014 to fund the development of the Ethereum platform. Ether is required to pay for computations and transactions on the Ethereum network. New ether is created during the mining process, with a limited amount produced every block to incentivize miners. The future of ether and Ethereum is debated, but many experts are optimistic about the potential of the platform and its smart contract capabilities to revolutionize industries.

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    109 views11 pages

    Ether:The Crypto-Fuel For The Ethereum Network

    Uploaded by

    Paavni Jain
    Ether is the cryptocurrency fuel that powers the Ethereum network. It was first sold in a crowdsale in 2014 to fund the development of the Ethereum platform. Ether is required to pay for computations and transactions on the Ethereum network. New ether is created during the mining process, with a limited amount produced every block to incentivize miners. The future of ether and Ethereum is debated, but many experts are optimistic about the potential of the platform and its smart contract capabilities to revolutionize industries.

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    © All Rights Reserved
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    of 11

    ETHER:THE CRYPTO-FUEL

    FOR THE ETHEREUM


    NETWORK
    BY
    Chiron Singhi (16010126421)
    Paavni Jain (16010126456)
    Prakruti J Shah (16010126447)
    WHAT IS ETHER?

    • Ether is a necessary element — a fuel — for operating the distributed


    application platform Ethereum.
    • It is a form of payment made by the clients of the platform to the machines
    executing the requested operations.
    • Ethereum was proposed in late 2013 by Vitalik Buterin, a cryptocurrency
    researcher and programmer. Development was funded by an
    online crowdsale that took place between July and August 2014.
    • Ethereum is not just a blockchain; it’s a decentralized programmable
    blockchain-based software platform
    • Ethereum allows you to build and execute smart contracts and Distributed
    Autonomous Applications (DApps), without censorship, downtime, or any
    third party.
    HOW ARE ETHERS CREATED?

    • The total supply of ether and its rate of issuance was decided by the
    donations gathered on the 2014 presale. The results were roughly:
    • 60 million ether created to contributors of the presale
    • 12 Million (20% of the above) were created to the development fund, most
    of it going to early contributors and developers and the remaining to
    the Ethereum Foundation
    • 3 ethers are created every block (roughly 15 seconds) to the miner of the
    block
    • 0.625-2.625 ethers are sometimes sent to another miner if they were also able
    to find a solution but his block wasn't included (called uncle/aunt reward)
    FUTURE OF COIN AND ASSOCIATED
    BLOCKCHAIN

    • Ethereum has a separate blockchain that has several significant technical


    differences from Bitcoin’s blockchain.
    • The entire Ethereum system is supported by a global system of so-called
    ‘nodes.’ Nodes are volunteers who download the entire Ethereum’s
    Blockchain to their desktops and fully enforce all the consensus rules of the
    system, keeping the network honest and receiving rewards in return.
    • Every node on Ethereum network also needs to download the most recent
    state, or the current information, of each smart contract within the network,
    every user’s balance and all the smart contract code and where it’s stored.
    FUTURE OF COIN AND ASSOCIATED
    BLOCKCHAIN

    • Smart Contracts are designed to automatically perform transactions and other


    specific actions within the network with parties that you don’t necessarily trust. The
    terms for both parties to fulfill are pre-programmed into the contract. The
    completion of these terms then triggers a transaction or any other specific action.
    • Ethereum’s Blockchain technology itself has a potential of revolutionizing web-
    based services as well as industries with long-established contractual practices.
    Ethereum developers are planning a switch from a Proof-of-Work consensus model
    to a Proof-of-Stake consensus model in the future. Ethereum only just started gaining
    mainstream media’s and general public’s attention. A lot of experts agree that it is a
    disruptive technology that is set to not only completely change the way Internet
    works but also revolutionize services and industries that have been existing for
    hundreds of years. Overall, opinions on the future of Ethereum among
    cryptocurrency experts are generally positive.
    FUTURE OF COIN AND ASSOCIATED
    BLOCKCHAIN

    • Essentially, the Ethereum Blockchain can be described as a transaction-


    based state machine. When transactions are executed, the machine
    transitions into another state. Every state of Ethereum consists of millions of
    transactions.
    • Those transactions are grouped to form ‘blocks,’ with each and every block
    being chained together with its previous blocks. But before the transaction
    can be added to the ledger, it needs to be validated, that goes through a
    process called mining.
    • Mining is a process when a group of nodes apply their computing power to
    completing a ‘proof of work’ challenge, which is essentially a mathematical
    puzzle. Miners are a backbone of the Ethereum network, as they not only
    confirm and validate transactions and any other operations within the
    network but also generate new tokens of the network’s currency.
    CONTRACT SPECIFICATIONS DETAILS
    FOR TRADING

    • In 2016, as a result of the exploitation of a flaw in the Decentralised


    Autonomous Organisation (DAO) project's smart contract software, and
    subsequent theft of $50 million worth of Ether, Ethereum was split into two
    separate blockchains – the new separate version became Ethereum (ETH)
    with the theft reversed, and the original continued as Ethereum Classic (ETC).
    • The value of the Ethereum currency grew over 13,000 percent in 2017, to
    over $1400. By September 2018, it had fallen back to $105-200.
    • Ethereum’s average block mining time is 12 seconds, which means they
    have quick confirmations and has an endless supply unlike bitcoin, which is
    21 million.
    IS THE ETHER SUPPLY INFINITE?

    • No. According to the terms agreed by all parties on the 2014 presale,
    issuance of ether is capped at 18 million ether per year (this number equals
    25% of the initial supply).
    • This means that while the absolute issuance is fixed, the relative inflation is
    decreased every year. In theory, if this issuance was kept indefinitely then at
    some point the rate of new tokens created every year would reach the
    average amount lost yearly (by misuse, accidental key lost, the death of
    holders etc) and there would reach an equilibrium.
    IS THE ETHER SUPPLY INFINITE?

    • But the rate is not expected to be kept: sometime in 2018-2019 Ethereum will
    be switched from Proof of Work to a new consensus algorithm under
    development, called Casper that is expected to be more efficient and
    require less mining subsidy.
    • The exact method of issuance and which function it will serve is an area of
    active research, but what can be guaranteed now is that (1) the current
    maximum is considered a ceiling and the new issuance under casper will not
    exceed it (and is expected to be much less) and (2) whatever method is
    ultimately picked to issue, it will be a decentralized smart contract that
    will not give preferential treatment to any particular group of people and
    whose purpose is to benefit the overall health and security of the network.
    THANK – YOU

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