What is Electroneum? | Beginner’s Guide
What is Electroneum?
The Electroneum team makes acquiring cryptocurrency as simple as downloading an app. By breaking down the barriers around acquiring cryptocurrency, Electroneum believes they can spread their coin far and wide. There are countless people that want to buy various coins but aren’t willing to send awkward selfies with their passport to a website they know nothing about. There are also the issues of linking bank accounts and paying shockingly high fees. Electroneum feels they have the solution and in this guide, we’ll go over how they aim to bring cryptocurrency to the masses.
How does Electroneum work?
Electroneum, also referred to as ETN, is built off the Monero codebase to allow for transactions on a decentralized blockchain. Like Monero, Electroneum has some built-in privacy features. One of the main criticisms of Bitcoin is that the balance of every wallet address is public and easily searchable. This problem is solved with Electroneum’s stealth address, a one-time public key that “prevents recipient’s funds from being linked with their wallet. That address can be audited by a 3rd party to prove the transaction occurred. (With the sender sharing their public view key).
The recipient gets their funds through their wallet’s private view key which scans the blockchain. Once detected and retrieved by the wallet, a single-use private key is created (corresponding with senders public key).
The recipient can now spend those funds using their private spend key. This occurs without the sender, recipient, nor the amount transacted publicly linked.”
If you’d like to read more about the privacy technology behind Monero and Electroneum, we suggest our Monero guide here.
Transactions are relatively fast with dynamic fees based on the level of traffic on the network. You can check out the recent blocks here. The vast majority of the blocks have less than 0.2 ETN in total fees and new blocks are added around every minute.
The Electroneum codebase tries to avoid powerful ASICs having a huge advantage over CPU miners. The mining utilizes a memory bound algorithm to try and encourage CPU mining, giving average users easy access to ETN. The ability to give everyone access to this coin will be a recurring theme throughout this guide.
Electroneum’s greatest differentiator is using a mobile app to bring in new users. It is already available on Android and is coming to iOS in 2018.
The app provides access to a digital wallet and the ability to send and receive ETN. For extra security, you also have the option to create offline paper wallets. It’s recommended you spread your coins out across several paper wallets in case you lose one.
The app incentivizes you to share your knowledge of Electroneum with the world. Anyone who invites 5 friends to join the app is entered into a contest to win 5000 ETN. The new users you invited are also eligible to win.
The most interesting feature, currently in beta testing, is the ability to perform mobile mining. The app will allow your phone’s CPU to engage in simulated mining. This won’t cause your phone to heat up or lose significant battery life. The mining will also use a negligible amount of your internet data. Though your mobile mining won’t actually help confirm new blocks on the blockchain, you’ll still receive rewards. The app still requires the use of your CPU to teach people about the connection between the power of your computer and the ability to mine. Eventually, they hope to convert some of the mobile miners to full miners on a computer. Using the phone’s CPU also prevents people from simulating thousands of iterations of the app on a computer to receive free coins.
But why pay people to do virtual mining? “The mobile miners bring the utility of viral marketing to Electroneum. It’s important to remember they aren’t bringing blockchain utility, they’re bringing a different utility – they’re bringing on users at a ridiculously low CPA and allowing Electroneum to have viral growth.”
There are over 400,000 downloads so far, and that’s without the iPhone users.
History of Electroneum
The Electroneum ICO reached their hard cap of 40 million dollars during fundraising. Their Github release was November 1st. However, before the launch of the mobile app, they were hit by a distributed denial of service (DDoS) attack. The team had to shut down their servers and work over 26 hours straight to deal with the attack. Eventually, after some delay, ICO investors were distributed their coins and Electroneum continued working towards their goal of spreading ETN to the masses. Over 690 million ETN were transferring during the first 24 hours, requiring only 430 ETN in fees.
Sunday 18.41 Coding as fast as we can. Working to get this live all weekend. Thanks for patience, Hope for good news this evening! pic.twitter.com/wuZQZGoHUJ
— electroneum (@electroneum) November 5, 2017
Electroneum Team and Progress
Electroneum calls itself the first British based cryptocurrency. The team of 12, based in Kent, is led by Richard Ells, the co-founder of SiteWizard and Retortal.com. James Atkinson is the head of the Electroneum Development Team with over 10 years of experience in development. He’s leading the charge on the Electroneum App. Great respect is given to Dean Cole, the “member of the team with the least sleep… consuming giant quantities of caffeine.” He maintains and develops the servers required for mining and transacting in Electroneum.
The Electroneum team actively seeks out partnerships to further spread ETN. They recently partnered with XIUS, a telecommunication payment giant. Electroneum wishes to use this partnership to promote the use of their mobile mining app as a way to offset the costs of owning a smartphone.
BMedia, a Japanese based social media and e-commerce company, has also partnered up with Electroneum. BMedia’s 500,000 Facebook followers and monthly reach of 10 million users will play a key role in ETN’s marketing plan.
The company Fanfare gives out prizes and rewards to users that upload their own videos about the products they love. Electroneum has partnered with them to hopefully one day reward their users with ETN.
The Electroneum team hopes to replace in-game currencies, such as World of Warcraft gold, with ETN. Imagine all of the completed quests and sold items paying out in a currency that can easily be converted to other cryptocurrencies or fiat. This would not only encourage players to play more, but the gaming company could charge fees on depositing and withdrawing ETN from their ecosystem. Creating a game that advertises ETN as an in-game currency could also prove to be an effective marketing tool. One mobile game currently in beta testing involves trying to fly a rocketship to the moon while collecting ETN. When the player dies, they have to watch a video advertisement to help fund the ETN rewarded to the users.
There are several gambling websites already accepting Bitcoin, but the problem is that it’s hard for most people to obtain it. The majority of online gambling takes place outside of America, where it’s especially hard to acquire Bitcoin. Most countries do not have access to Coinbase or Gemini and their local exchanges often have 7% fees or higher. Electroneum once again hopes to reduce friction and encouraging gambling sites to accept the currency.
As mentioned previously, due to the ASIC resistant nature of the Electroneum mining algorithm, it’s still feasible to mine coins with just your CPU. You can complete a quick download and join a mining pool right away here. The average block reward is about 7000 ETN.
Coin Supply and Sustainability
The team reserved 4.4 billion ETN for investors in the ICO. Those who shared the ICO and translated relevant information received a combined 20 million ETN. The core 12 person team also reserved 20 million ETN for funding purposes. There’s a circulating supply of 5,967,959,479 ETN that will eventually reach a maximum supply of 21,000,000,000 ETN through rewards to the miners. 21 billion coins were chosen over Bitcoin’s 21 million for psychological reasons. They felt users would be more satisfied earning full coins as rewards and would prefer making purchases in integer values. After all of the coins are mined, miners will still be able to profit by collecting the transaction fees.
ETN’s ICO price was 1 cent, making people a 10x return on their investment. However, with the coin still in its infancy and the mobile mining still in beta testing, it’s too early to fully comment on the price. It’ll be interesting however to keep an eye on the release of the iOS version of the mobile app and if that has any effect on the price.
Where can you buy Electroneum?
You can currently purchase ETN on the Cryptopia exchange. ETN has not made it to any other exchanges yet but is in the process of applying to Bittrex, Binance, and many others.
Where can you store Electroneum?
The Electroneum Wallet Manager can be found here.
Through the wallet manager, you can set up online or offline wallets. The online wallet registered is accessible through the app using your same login details.
If you are new to cryptocurrency and having trouble joining exchanges, downloading the Electroneum app and trying to win free coins could be your entry into the crypto world. If loud expensive ASICs intimidate you, then check out the Electroneum CPU mining. Even though Electroneum is named after the electron, it’s hard to be negative about its future.
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ABOUT THE AUTHOR
ABOUT THE AUTHOR
Paul is a crypto-enthusiast, strategy game world champion, mathematician, and educator based in Taiwan. When he’s not drinking coffee to fuel these interests, you can find him on the way to a coffee shop.