15 December 2021
Mining is critical to Ethereum security. It allows the network to function without a single decision-maker. In mining, a subset of nodes provides computing power to solve cryptographic puzzles.
To compete with others, miners must be able to calculate block’s hashes as fast as possible. Each correctly guessed hash allows a miner to create a new block. The system rewards the miner who created a new block with all transaction fees in a block and freshly generated 2 ETH.
The generation of new blocks on the Ethereum network is faster than on the Bitcoin network. In the case of ETH, 15 seconds is enough versus 10 minutes in BTC.
The founder of Ethereum, Vitalik Buterin, decided to create a network with an unlimited number of coins. According to various sources, as of November 2021, from 113 to 116 million ethers are in circulation.
When the network was launched, approximately 60% of the ETH was issued. The genesis block that is the first block, issued 72 million coins in 2015. The generation of new coins is at the level of 5.4 million ETH per year, providing growth of the money supply by 2.3%.
The remuneration is currently 2 ETH with the addition of network fees for each transaction and it decreases every two years.
One of the important points in the Ethereum system is the payment process. Any computation or transactions made within the Ethereum network is subject to a certain fee called "gas". The price of fuel is the amount of "ether" you can spend on each unit of fuel. The price of fuel is measured in "gwei". Gwei is the smallest unit of ether, where 1018 Wei is only 1 ether. One gwei is equal to 0,000000001 ETH.
For any transaction to take place, the sender must set a fuel limit as well as a fuel price. Fuel price and fuel limit are the maximum amounts in gwei that a miner is ready to pay to complete a transaction.
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