Everything needs a fuel that will help to operate a platform. If you want to run the engine, it must need fuel. If you want to light the lamp, it needs fuel. And fuels are not always the same. Similarly, Ether is here regarded as the fuel for the Ethereum platform.
So, here we go-
What actually the Ether is?
Ether is the underlying token and fuel that is powering the Ethereum Blockchain. In Bitcoin Blockchain, Bitcoin is regarded as the value of exchange. Similarly, In Ethereum Blockchain, Ether is a value of exchange.
Dislike the Bitcoin, Ether is not only regarded as a currency only. Which is transferable to peer-to-peer transaction or network. But, it plays a role as the ‘fuel’ or ‘gas’ to power the Ethereum Network.
As you have known in my previous article about Ethereum, Ethereum is an open source platform. It runs smart contracts. Hence, when smart contracts are run on a blockchain, they can execute themselves. While smart contracts execute, it needs computational resources. These computational resources must be paid in any way. This is why Ether come for.
How Ethers are created?
You may know about it before or after reading this article. But, have you ever thought about how it was created? Who are involved here? How they create?
I think, not all of you. Some may be. Therefore, we here tried to show some core processes:
Presale of Ether in 2014 was decided when donations were gathered the total supply of it and its rate of issuance.
- Contributors of the presale created 60 million ether
- Development fund created 12 million ether, which is 20% of the total. Early contributors and developers got most of it and rest went to the Ethereum Foundation
- In the miner of the block, every block creates 3 Ethers
- If other miners are also able to find out a solution then, sometimes 0.625-2.625 Ethers are sent to other miners
Is it works same as Bitcoin?
Obviously, not at all. Though they have some similarities for currency value, they are not the same at all. Bitcoin is used only for currency value. But, Ether is used both for currency value of exchange and at the same time, it works the fuel for Ethereum Platform. In the Ethereum platform, ERC20 token works as the asset value or value of exchange like Bitcoin.
Ethereum Network has its different platforms and services as we have discussed above. And not all things are not free at Ethereum network. You have to pay for some services. This payment is not possible with other currencies without it.
So, here we come to know that though they are used for same currency value of exchange, but, Ether contains much other characteristics than Bitcoin.
So, they are same in one perspective and different from many perspective.
Who needs it?
Hey, buddy! You need it. Yeah! Exactly, I know that you need it. But, you must know whoever else need it outside your home.
Developers who intend to develop or build DApps using Ethereum Blockchain will need it. Some users on the Ethereum blockchain want to access and interact with smart contract, they will need it.
That’s it. If you have further any questions about, you are so welcome to ask in comment box.