Top 12 Cryptocurrency Coins
2. Ethereum (ETH)
ETH is the abbreviation of the ethereum cryptocurrency. Cryptocurrency coin abbreviations are usually used by investors to identify and trade desired coins on a cryptocurrency exchange.
Ethereum is a public, open-source, blockchain based software cryptocurrency platform and operating system with smart contract functionality that allows developers to build and deploy decentralized applications on its blockchain. Ethereum and its whitepaper were introduced in late 2013 by Vitalik Buterin with $18.4 million raised for its blockchain development at the end of ethereum’s ICO event in August 2014. Vitalik Buterin went on to lead a team, developed and successfully launched ethereum blockchain on 30 July 2015.
Ethereum’s Consensus Protocol
Ethereum uses the same mining process and consensus protocol as bitcoin that is the Proof of Work (PoW) consensus protocol. Miners compete with each other to solve mathematical puzzles, the winner will get to validate transactions and create a new block on the blockchain to earn new ethereum cryptocurrency reward. Ethereum mining is mainly done with GPUs while bitcoin professional miners use ASIC mining rigs.
Ethereum vs Bitcoin
The difference with ethereum blockchain and bitcoin blockchain is that ethereum has faster block creation time than bitcoin. Bitcoin’s block creation time is limited at 10 minutes while ethereum’s block creation time is around 14 seconds. The reason is that bitcoin cryptocurrency founder, Satoshi Nakamoto designed bitcoin blockchain to have block creation target of 10 minutes, this will give the blockchain more time to propagate the new block to the entire network before creating another block.
Bitcoin’s block creation time of 10 minutes is to prevent block orphaning on the blockchain by invalidating one of the block if two or more blocks are found at the same time. Ethereum on the other hand allows orphaned block to be accepted into the blockchain which will result in faster block creation time. Ethereum miners who include orphaned blocks will get slightly more cryptocurrency block rewards but lesser rate of return for mining a more difficult block that will result in a longer chain. Some bitcoin users commented that faster block time results in a less secure network and that a single bitcoin confirmation is more trustworthy as compared to an ethereum confirmation.
Native Cryptocurrency Token of Ethereum
Ether, popularly known as the fuel that runs Ethereum, is a cryptocurrency generated by the ethereum platform on the blockchain. Ether’s cryptocurrency abbreviation is ETH and it can be used as a form of cryptocurrency payment made by the clients of the platform to the machines executing the requested operations. Ether cryptocurrency block time creation is around 14 to 15 seconds, compared to 10 minutes for bitcoin blockchain.
Ethereum blockchain with its ether cryptocurrency had the second largest cryptocurrency market cap of more than $65 billion USD with a total coin circulating supply of around 99 million as of April 2018. At present, there is no implemented hard cap on the total supply of ether.
ERC-20 Technical Standard
ERC-20 is the technical standard used by all smart contracts that are using the ethereum blockchain. ERC-20 technical standard defines a complete list of rules that all ethereum tokens must comform to within the ethereum ecosystem. ERC-20 token standard became popular with organizations that were looking to raise funds through Initial Coin Offering (ICO) cryptocurrency crowdfunding. The reason is that ERC-20 technical standard is not complicated to be deployed and there is interoperability potential with other Ethereum token standards. Among the most well-known ERC-20 token sales were launched by the EOS and Tron teams to raise funds for their cryptocurrency and blockchain developments.