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 unique in that it allows developers to build these decentralized applications, or Dapps, on its blockchain.
This not only makes Ethereum’s blockchain more versatile than Bitcoin’s, but it also creates a whole new category of applications that can be built on Ethereum.
Ethereum has been designed to be inflationary, with a maximum supply of ETH that will be mined over time. The number of Ethereum that will be mined is not determined by a central authority, but rather by the code of the Ethereum protocol.
The protocol incentivizes miners to mine Ethereum by awarding them with newly minted ETH for each block they mine. As more Ethereum is mined, the rewards for mining diminish over time.
The Ethereum protocol halves the mining reward approximately every 4 years, which reduces the inflation rate and ultimately caps the maximum supply of ETH. While the total supply of Ethereum is not yet known, it is estimated to be around 100 million ETH.
So while there is a limit to the number Ethereum that will be mined, we do not yet know what that limit is. Ethereum’s use as a decentralized platform and its potential for growth makes it an exciting cryptocurrency to watch in the years to come.
