Today we will be talking about Electroneum. Electroneum, is a payment cryptocurrency, like Bitcoin or Ripple or Stellar, it is meant to be used as a form of payment. But it also has a couple of unique features namely,
- It is a privacy coin forked from Monero
- It is the world's first mobile mining cryptocurrency (sort of, Il explain more later)
Over the past couple of months, Electroneum has been facing two main problems.
The first is flooding.
So as you can see here, some people with very malicious intent have been doing millions of microtransactions to try and flood and overload the system to disrupt normal transactions. Why they would do that I have no idea, but someone is trying to sabotage the system.
The second trouble they are facing is monopolisation of their mining.
Electroneum’s mining was designed to be lightweight and able to be done on a CPU. They even have a cell phone app to do mock mining to attract the masses. So easy mining available to the masses is one of the core attractive features.
Now Bitmain has designed ASIC GPU chips to do super mining, and they were initially monopolising Monero’s mining process and changing it from a decentralised model to a centralised model. Monero did a fork to make itself ASIC resistant and all these people with ASIC chips then thought “what can we do with our expensive hardware now?” So they then turned their eyes to Electroneum who in technology is very similar to Monero and started monopolising Electroneum’s mining. In fact, Electroneum is even attractive than Monero because where Monero doesn’t have a total supply cap, Electroneum does, which makes each token mined potentially more valuable. The original miners of Electroneum are already experiencing 90% reduction in their mining returns because of the ASICs influx, and ASICs is due to release a new version in June that will mine 10x faster than the current ASICs. So Electroneum needs to do something soon.
And they have. They have decided to do a fork at block 307,500, which is estimated to happen on 30th May, and hopefully the fork will address all the above problems.
Now, it’s important to know guys, that in Blockchain when we talk about the word “fork” it doesn’t always mean a second currency.
Many times because of examples like Bitcoin Cash or Ethereum Classic, token investors think of a fork as creating a second currency and they might get free tokens. Sometimes it is that way, but not in this case.
A fork is basically a major upgrade to the system. Sometimes that upgrade is so drastic and disagreed on that two parties create two currencies, but this is not the case. This fork will purely be a software upgrade and there will be no second currency. The reason I need to point this out is because
there has been another coin that has been recently launched and is trying to take advantage of the confusion that coin is called Electroneo. So not electroneum and they are not recognised by the Electroneum company, but they’ve intentionally made themselves sound very similar by calling themselves Electronero. They’ve even designed their logo to look like Electroneum except their lightning is yellow, and they post all the features of the upcoming upgrade as their positive features. They also ask users to send them the private key of their ETN wallet to claim the ETNX token, and they don’t show their personal full profiles on the website. So Electroneo smells like scam guys, I recommend being aware and staying away from it.
What I will do for the rest of this blog is 3 things,
Introduce Electroneum and explain their unique features like mobile mining in simple terms for those who are new to this project as well as explain their original tech like ring signatures and then use that to
explain the upcoming fork/ update in a simple manner
and finally I’m going to talk abit about how I see Electroneum as a project. Electronuem’s always had a lot of controversy with some people loving it, but others hating it and accusing them of not having their own developers because their technology is based off Monero’s and not their own.
Our channel as you guys know, is very neutral in our reviews, we don’t shill or FUD any particular project, so I’m going to try and give you a neutral perspective on Electroneum at the end.
Electronuem is the first cryptocurrency to secure membership with the GSMA which is a tech group consisting of nearly 800 operators with more than 300 companies in the mobile ecosystem. This is huge, and they are a project that is very closely linked to the mobile industry.
The average person on the street doesn’t know what cryptocurrency is and can’t be bothered to learn a lot about Blockchain and crypto stuff. But the average person will be willing to download an app and try it for fun, especially if the app gives them free money/ cryptocurrency.
The electroneum app has a simple mining feature and the android mining app was released 2 months ago, and has already over 100,000 mobile miners, so the marketing is working, people are attracted to their app and the project does seems headed towards mass adoption.
Besides being easy to use as an app, Electroneum also wants to be easy to spend. Because there is no point getting free currency if you can’t spend it. Electroneum has already signed agreements to develop payment integration with over 1.2 million agents, dealers and distributors in over 9 countries and counting.
Sometimes the best projects are not the most complicated projects, but the simplest projects with the lowest barriers to use. Electroneum market themselves not as a Blockchain technology but an app that is easy to install, easy to use, and gives you free money. Those who are purist on Blockchain technology might be offended that they don’t showcase the greatness of Blockchain technology, but I personally think it’s a refreshing and clever way to achieve mass adoption.
Now let’s take a look and see if they actually have a technology.
They have 2 whitepapers:
The first is an overview white paper. This is one is very pretty and explains a lot of basic details like what is cryptocurrency etc.. If you have been in the crypto scene more than a few months, you probably won’t learn much from it.
The second is a technical white paper, it’s not long, only 8 pages, and if you’re familiar with Monero’s technology, you will find this white paper very familiar.
The underlying technology is called CryptoNote Alorithm. It’s a technology designed for privacy and it’s not unique to just Monero, other privacy coins like Bytecoin also uses it.
It has 2 main features:
- Untraceable payments using Ring Signatures.
So normal transactions uses an ordinary signature that tells everyone you were the one using that signature.
Ring signature is a collection of multiple signatures from various transactions and hiding it all under a blanket. So if you tried to trace back a transaction from the receiver, all you hit is a whole pool of senders in the ring and you can’t tell who sent the transaction. This is untraceabiltiy.
- The second feature is known Unlinkability.
So think of it as untraceablitly focuses on privacy on the receiver end of the transaction, but unlikability focuses on privacy on the sender end of the transaction.
If I use ring signatures, no one can trace what transactions I do, but they can still obtain information about my account by looking at my transaction history. Unlinkable is the process of preventing anyone from tracing your transaction history.
To make an account unlinkable, Electroneum’s CryptoNote creates multiple on-time keys. Meaning every time you send a transaction, you are sending it from a different address, so if I trace it back from to that address, I will only find one transaction record not all your transaction records.
Now the combination of untraceability and unlinkability together provide what is known as “Blockchain analysis resistance/ ambiguity”, because the combination of untraceability and unlinkability, creates billions of possibilities and make the system resistant to people trying to analyse it the way they analyse Bitcoin.
1 Unfortunately in the upcoming update, unfortunately they will be removing ring signatures. The reason for this is block capacity. To be very efficient at processing micro-transactions which is what Electroneum is all about, you need to be able to fit as many transactions in to each block as possible. It’s like the more people you can fit on each train during peak hour, the quicker the traffic will clear and the shorter the waiting time for people. Ring signatures are chunky and they have no size limit. In fact the bigger the ring the more private and secure the transaction is. But it takes up too much block space, it’s like trying to squeeze people with hula hoops into a train. It severely limits the number of transactions you can put on a block. so after careful consideration the team have decided they will do away with ring signatures.
They will still keep the unlinkability which means private wallets, but if you want a true privacy you’d be better off with Monero.
2 And they will also increase block size before penalty. So at the moment, miners who create blocks above a the median size limit will be penalized, so increasing the block size penalties encourages bigger blocks. This in this case means faster transactions.
3 They will also make their technology Anti-ASIC, so this is really good news for the CPU miners which is the original intention of Electroneum. And it’s good to see Electroneum remaining true to their Ethos and protecting CPU mining.
4 Another update is to increase the Mempool life to 3 days. So in the odd case where there is high transaction volume, a transaction can remain in the mempool for a period of time. That time limit now is 24 hours after which it will be sent back. Increasing the mempool life reduces the possibility of returned transactions/ meaning reduces the risk of a failed transaction.
5 They will also be increasing the transfer fees 10x, which is actually a good thing and Il explain why. Electroneum’s current transaction fee cost 0.01 ETN which is 0.02 cents. Which means for $1 you can spam 5000 transactions.
Which is why, people can afford to flood and sabotage the system with useless transactions.
By increasing the cost of a transaction to 0.1 ETN or basically 0.2 of a cent. It still costs almost nothing for us who are using ETN for proper transactions. E.g if I buy a shirt for $30, 0.2 cents charge is nothing. But for someone who is trying to spam thousands of transactions per second, that 10x increase in transfer fees is going to hurt them and discourage such activities. In fact token holders should be glad, because higher transaction fees within reasonable limits is actually good for token price.
6 There will also be a change to 2 minute blocks and block rewards, as token holders or miners, don’t worry about this one. It doesn’t affect mining at all. Basically they are moving to 2 min blocks to decrease chance of creating an orphan block, but this halves the mining reward, so to compensate for that they are doubling the block rewards. It’s a behind the scene set-up to reduce orphan blocks, it won’t affect mining or token price.
7 And the last update they will have is reducing difficulty windows. So some people have discovered that by hitting the ETN Blockchain with a large surge of rented power, the miner can have an advantage over a short period of time. By reducing the difficulty window, it means that you also reduce the benefits of having larger surges of power--- Discouraging this practice. This makes mining fairer again for the majority.
So all good updates. But it’s a lot of updates, which is why they need a massive process called a fork to do it on May 30th. Again, it is not minting a new currency, its just a massive upgrade to the system.
Electroneum is open source, meaning people can contribute to the project, so do check the github for the updated details if you’re a contributing developer.
Just little abit more tech before we move on. This is about their concensus algorithm.
Electroneum uses a concensus algorithm called Egalitarian Proof of Work. Those of you who have been in the crypto space for 1-2 years might not be familiar with this, but back in 2014/2015, when people were looking at how to improve POW, and rather than coming up with new consensus algorithms like POS/ DPOS, people were still looking at POW and coming up with different improved versions of POW. And Egalitarian POW was one of the more popular solutions then.
So the standard proof of work was designed to be decentralised, that means used equally by thousands of nodes. However, mining chips e.g. Asics Mining chips were created and they were so powerful that they monopolised the entire Bitcoin mining industry. So what was meant to be a decentralised processed became a very centralised process.
Egalitatian Proof of Work is a version of POW that attempts to restore equal voting rights to all participants in the concensus algorithm. It relies on random access to a slow memory and emphasizes latency dependence.
I think an easy of looking at it is to think of it as no matter how big a node you are, you still only get one vote. So it’s another aspect of the project that promotes fairness.
Now I’m just going to side track a bit and address people who are unhappy with this project and accusing them of forking from Monero and not having their own technology etc… when you actually review the tech, you see that the choice of the original technology as well as the updates that they are implementing now are all geared towards creating a fair environment for normal CPU miners to benefit. As a company they have remained true to their Ethos and are doing whatever they can to protect that fairness. And I think unless you review the tech, you might miss this genuine good intention of the team. I really like it. This is what decentralisation is, removing monopoly of profit and distributing it to the masses, so that the average person out there has a chance to gain wealth. Electroneum in my opinion is doing way more than some other bigger projects in protecting the decentralisation of their Blockchain.
I’m going to talk briefly now about their mobile mining. Proof of Work uses quite a bit of computational power. So how can you mine effectively on your mobile phone?
The answer is you can’t actually. The mobile mining is not actually mining. It is only the experience of mining. It doesn’t actually use your phone’s CPU to solve complicated cryptographic problems (which is what mining in Blockchain is), rather it is determining the available CPU power on your phone and determining the amount of CPU that could have been used for mining and rewarding you accordingly, that’s why it consumes so little bandwidth and battery. It’s basically an advertisement for mining. In addition, you can play a mining game to increase the number of coins you receive, and the game isn’t pointless, it actually educates people about what mining is and encourages people to set up their own proper CPU miners.
The rewards for the mobile mining comes from the leftover of the ICO fundraising which is about 2 billion coins.
In terms of how much people can mine each day, I might be wrong, but from asking around, it seems people are getting about 20coins/ day. If you are actually mining, please let us know in the comment section how much you are averaging a day and the make of your mobile phone so that the community can have a rough idea of what to expect.
The IOS version is not out yet, but rumors are it will be released very soon. And apparently the upcoming will also vastly improve the mobile mining experience cos there are still some teething issues with people being logged off or inconsistent hash rates etc…
Ok, we are finally done with the tech stuff! Whew!
Team
This is the team behind the project, or rather part of the team. There’s a total of 22 members listed on their website, including their dog Ruby.
I won’t go through all their resumes of course, but Il run through a couple:
Richard Ells is their director and Founder. He’s been in the internet and technology arena for 19 years with skills as a coder, hacker, developer, designer even hacking. His previous ventures include web design and development, and he is also the current CEO of another project Retortal.com, which is used by Fortune 500 companies and hundreds of thousands of users worldwide.
Chris Gorman is their co-director. He has a very successful history in mobile, fintech, technology and retial. He previously won Ernst and Young UK E-Business Entrepreneur of the year, Scottish Entrepreneur of the year, Young Business Leader of the Year, Glenfiddich Spirit of Scotland in Business, and the laudable SBAAT Businessman of the Year Award. And back in June 2005, Chris also received an OBE for services to business from HRH The Queen at Buckingham Palace.
You can go through the rest of their profiles on their website. But they definitely come across as a team that knows what they are doing.
They also have a couple of advisers:
Who are a director in private businesses, and consultant in ecommerce, online gaming and Fintech businesses. They are not big names I recognise, but they each have over 20 years of experience and I’m sure are big names in their own fields.
They also have a few partners including Xius who is the telecoms operating brand of Megasoft, Bmedia, Quoine which you guys probably know the crypto exchange launching QASH liquidity.
And they also have a couple of stores accepting ETN as payment already, namely including ditch-it and Megaxstore.
So still a lot of room to grow, but the fact that even one place is accepting them is huge in my books, cos not many cryptocurrencies have that at the moment.
They’ve also patented their payment gateway software about a month ago. Apparently it’s instantaneous paymet, very good stuff. Please don’t ask me how they do it or why I didn’t cover this under the tech review, its patent and its secret. But what they do say is because they now have the patent they can now add Bitcoin, Ethereum, Monero and other cryptocurrencies to their wallet and afford instant payments/ check-outs to any vendors. This alone is actually huge news.
5 days ago their CEO was part of a BBC documentary on “magic money”. So wow there’s a lot going on for this project in the month of May.
Roadmap
Alright coming towards the end, very quickly, this is their roadmap. And…. It’s a sucky roadmap.
Roadmaps usually give you dates which the team are expected to hit milestones. This roadmap gives you the dates after they hit the milestones, which is pointless and they give a general list of milestones they hope to hit in Q2 and beyond, which is not even a time it just anytime between now and forever. The goals they are aiming to hit are also very vague e.g. “continue to grow the team” “develop commercial relationships” etc… no numbers, no dates, nothing.
So its not very accountable to the investors I think. If I was an investor, I would have no idea what to look forward for beyond to beyond May. The team could sit on their bums and we would have no idea because there is no date and milestone to check their progress. This is a good team, I’m sure they won’t do there, but Im explaining why it’s important to have proper milestones and dates on a roadmap.
Pricing
Last but not least, pricing and we’ll finish. This is their current price details taken from coincodex which is my favorite website to look at pricing. I much prefer it over coinmarketcap. They are currently sitting at $ 0.023. At their all time high, they were sitting at $0.19 so they are only about 15% of their all time high. This is a crazy cos most coins have returned to about 1/3 of their all time high at least by now, but for some reason Electroneum has still remained under the radar as the market has beginning picking up.
With all the recent happenings, I don’t think this coin will remain under the radar for much longer. The main thing that catches my attention is the fact that online shops are actually signing up to use the ETN token. If they have a use case, they will be successful it’s just a matter of when. If they ever returned to their all time high, that’s already like an 8x growth and I think its very likely they will do that and more within the next few months.
I like the Electroneum project guys, I really think there’s a lot to like in this project. They are simple to understand with low almost no barrier for the general public to start using their app. They have partners and actual use cases for the currency and that is still growing. The token price seems very low and a very attractive entry point at the moment. They have good team with successful track records in their careers, and most of all I personally believe as a project they have a very good Ethos of keeping the whole project especially the profits fair and decentralised for the users. As a believer in Blockchain and decentralisation, I’m a fan of that.
So that’s it guys, those are my thoughts on Electroneum.
As always, none of this is professional advice. This is all my personal subjective opinion, so please always do your own research and make your own decisions.
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Alright guys, have a wonderful day, catch you guys again soon!
What a complete article, thanks for sharing @cryptolite!
Super
greetings good publication
I am mining it with my phone and I earn about 9-11 ETN per day
Excellent article about ETN...