Ethereum, the world’s second-largest cryptocurrency by market capitalization, is no stranger to controversy. One of the most common criticisms leveled against Ethereum is that a large percentage of the total supply was premined before the network went live.
In this article, we’ll take a closer look at how much Ethereum was premined and whether or not this is a cause for concern.
Ethereum’s founders decided to premine a portion of the supply before launch in order to raise funds for development and initial distribution. A total of 60 million ETH were premined, which represented about 18% of the total supply at launch.
This may seem like a lot, but it’s actually less than what was premined for other projects like Bitcoin and Litecoin.
So why is there so much concern about Ethereum’s premine? Part of it has to do with how the ETH was distributed. A large percentage of the premine (40%) was allocated to the Ethereum Foundation, a non-profit organization that promotes and supports Ethereum development.
NOTE: Warning: Ethereum was premined, meaning that a large portion of the total supply of Ethereum tokens was created and distributed before the official launch of the network. As such, it is important to be aware of the potential risks associated with investing in premined cryptocurrencies, such as Ethereum. Premined tokens can often be subject to greater volatility and manipulation than non-premined tokens. Further, it is important to understand the full implications of investing in a premined cryptocurrency before making any financial decisions.
This has led some people to accuse Ethereum of being centrally controlled and less decentralized than it claims to be.
Another reason for the concern is that a significant portion of the premine has been sold on exchanges, which has had a depressing effect on price. If all of the premine were dumped on the market at once, it would likely cause a sharp price decline.
This could lead to investors losing confidence in Ethereum and fleeing to other projects.
Fortunately, the Ethereum Foundation has been very careful about how it sells ETH from the premine, and it seems unlikely that they will dump all of it on the market at once. However, the large amount of ETH that was premined does give the Foundation considerable control over the project, which could be problematic in the future if they are not transparent about their decisions or use their power in an unethical way.
In conclusion, while there is some cause for concern about Ethereum’s premine, it doesn’t appear to be a major problem at present. The Foundation has been responsible about selling ETH from the premine and doesn’t seem likely to dump all of it on the market, which would cause a sharp price decline.
However, the Foundation does have significant control over the project due to the large amount of ETH that was premined, which could be problematic if they are not transparent about their decisions or use their power in an unethical way.
10 Related Question Answers Found
Ethereum is a decentralized platform that runs smart contracts: applications that run exactly as programmed without any possibility of fraud or third party interference. In order to achieve this, Ethereum uses a public blockchain similar to Bitcoin’s. However, Ethereum’s blockchain is much more versatile than Bitcoin’s, allowing it to run not only financial applications but also decentralized applications (dapps) with no third party involvement.
As of September 2018, about 60 million ETH had been premined. Prior to the launch of Ethereum, a total of 72 million ETH was created, which included the 60 million ETH premine and 12 million ETH that was mined during the genesis block. Of the 60 million ETH that was premined, 20% was sold to investors in a private sale, while the remaining 80% was retained by the Ethereum Foundation.
Ethereum is a decentralized platform that runs smart contracts: applications that run exactly as programmed without any possibility of fraud or third party interference. Ether, the native cryptocurrency of Ethereum, is mined through a Proof of Work (PoW) consensus algorithm (like Bitcoin). Miners are rewarded based on their share of work done, rather than their share of the total number of blocks mined.
Ethereum has been through a lot in its short life. From the DAO hack to the Parity wallet freeze, Ethereum has faced some challenges. The community has responded to each of these challenges and Ethereum has come out stronger for it.
The Ethereum network is a decentralized platform that runs smart contracts: applications that run exactly as programmed without any possibility of fraud or third party interference. These apps run on a custom built blockchain, an enormously powerful shared global infrastructure that can move value around and represent the ownership of property. This enables developers to create markets, store registries of debts or promises, move funds in accordance with instructions given long in the past (like a will or a futures contract) and many other things that have not been invented yet, all without a middle man or counterparty risk.
Ethereum is a decentralized platform that runs smart contracts: applications that run exactly as programmed without any possibility of fraud or third party interference. Ethereum is currently the second largest cryptocurrency by market capitalization, behind only Bitcoin. And, its founder, Vitalik Buterin, is one of the most influential people in the crypto space.
As of July 2018, Ethereum has a market capitalization of over $41 billion, and its price has been as high as $1,422.53. Each ETH token is worth $744.86. There are currently 97,863,956 ETH in circulation, and the total supply is not expected to exceed 120,000,000 ETH.
Decentralized finance—better known as DeFi—refers to the shift from traditional, centralized financial systems to peer-to-peer finance enabled by decentralized technologies built on the Ethereum blockchain. From lending and borrowing platforms to stablecoins and tokenized BTC, the DeFi ecosystem has launched an expansive network of integrated protocols and financial instruments. Now with over $13 billion worth of value locked in Ethereum smart contracts, decentralized finance has emerged as the most active sector in the blockchain space, with a wide range of use cases for individuals, developers, and institutions. .
As of September 2018, there are over 27,000 Ethereum nodes active around the world, with the vast majority of them (24,000) located in the US. The number of nodes is constantly increasing as more people begin to run them. Each node represents a single point of failure for the network and so the more nodes there are, the more resilient the network becomes.
Ethereum is a decentralized platform that runs smart contracts: applications that run exactly as programmed without any possibility of fraud or third party interference. In order to run these applications, Ethereum utilizes a token called Ether. Ether is used to pay for gas, which is the fuel that powers the Ethereum network.
