What is Aeternity (AE) [A Comprehensive Guide to Understanding Aternity]

By Mr.CryptoWiki | cryptocurrency | 6 days ago

$7.06 tipped


Blockchain is an innovative new technology that can revolutionize the way enterprise businesses and governments do business. It’s been declared “an important breakthrough” by China's President Xi Jinping and is increasingly being legitimized throughout the world.

At the forefront of this revolutionary technology are cryptocurrency projects building out blockchain technology equipped with smart contract capabilities, novel consensus mechanisms, unique governance models, decentralized applications, oracles, and more. 

However, many crypto projects such as Ethereum (ETH) – the leading smart contract and dapp development platform – have run into scalability problems that prevent certain types of dapp’s from operating properly at scale. 

While Ethereum is working on various solutions to conquer these problems, other cryptocurrency projects have sprung up claiming to have better solutions than Ethereum. 

One such project that’s striving to solve blockchain scalability is Aeternity (AE) – a blockchain platform focused on high bandwidth transacting, purely-functional smart contracts, and decentralized oracles. 

In the following article, I provide a comprehensive and subjective look Aeternity (AE) so that you can fundamentally understand what Aeternity is and see the value proposition of its cryptocurrency Aeon (AE). I delve into its unique characteristics, its history, purpose, partnerships, as well as its issues and controversies surrounding it. 

So buckle up and enjoy this comprehensive guide to understanding this innovative cryptocurrency tackling scalability – Aeternity (AE).

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History of Aeternity (AE)

Aeternity was founded by Yanislav Malahov in 2016. Malahov has been working in crypto for a long time and claims to have worked with Vitalik Buterin, the creator of Ethereum before it even launched. 

He also claims to have sparked Buterin’s idea for Ethereum and thus calls himself the “Godfather of Ethereum”. However, Malahov was not involved with Ethereum’s development but did work on various other projects with Buterin in the past. 

Nearly 3 years after Ethereum’s launch, Aeternity launched its testnet in early 2017 with its ICO shortly after in April 2017. Aeternity’s Aeon (AE) token was launched as an ERC-20 token as a means for early funding before the Aeternity blockchain mainnet went live on November 27, 2018. After the mainnet launched, the ERC-20 Aeon tokens were migrated to the new blockchain on a 1:1 basis. 

Going back to Aeternity’s ICO, the project collected 224,935.3 ETH and 1,461.618 BTC (equivalent to ~$24.4 million). Aeon tokens were sold at a price of $0.284 USD. Aeternity’s peak price so far was $5.00 on May 4, 2018, and has since collapsed along with the rest of the market. 

The total supply of Aeternity is 338,484,324 AE and the circulating supply is 292,663,381 AE. 

 

Purpose of Aeternity (AE)

https://www.aeternity.com/

“Aeternity is a new blockchain technology, designed to deliver unmatched efficiency, transparent governance, and global scalability.” - www.aeternity.com 

In the simplest of terms, Aeternity is a new blockchain platform that aims to be more scalable and viable than Ethereum and other blockchain platforms offering functioning smart contracts and dapp development capabilities.

Its purpose is to provide scalable, decentralized, and trustless alternatives to the existing governance, economic and financial intermediaries.

To achieve this purpose, the Aeternity team has created and continues to build a public, open-source, blockchain-based distributed computing and digital-asset platform. 

The platform allegedly utilizes next-generation, highly scalable, public blockchain technology and features off-chain smart contracts and built-in decentralized oracles that leverage real-world and real-time data. 

That being said, Aeternity is simply attempting to be a faster, better, and more scalable smart contract and dapp development platform that can be applied to a wide array of individual, business, and government blockchain applications and solutions. 

As for the Aeternity’s native cryptocurrency, Aeon (AE), it’s function is essentially the same as ETH in Ethereum. All system fees on Aeternity’s blockchain are paid with Aeon and all smart contracts settle in Aeon.

Additionally, Aeon tokens can be traded on a wide array of cryptocurrency exchanges including:

  • Binance
  • Huobi
  • OKEx
  • HitBTC
  • CoinBene
  • Gate.io
  • ZB.com
  • MXC
  • Coinall
  • DragonEX
  • BKEX
  • HotBit
  • BitAsset
  • BitHumb
  • Livecoin
  • And others.

All in all, Aeon (AE) is traded on many exchanges.

Potential Aeternity Use Cases:

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  • Nano and micropayments
  • Supply Chain Management
  • Information markets
  • Multiplayer video games where the rules are enforced by the blockchain. Poker, chess, Go, first-person shooter games.
  • Toll API
  • Insured crowdfunding
  • Cross-chain atomic swaps
  • Assets and portfolio replication
  • Contracts for powering crowd sales to finance projects in the public interest and create a sustainable economy
  • And many more

Innovative Features of Aeternity:

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Smart Contracts
Aeternity features Turing complete smart contracts that execute transactions and commands without the need for third parties or intermediaries.

Consensus
Aeternity uses a unique hybrid Proof-of-Work (PoW) and Proof-of-Stake (PoS) consensus algorithm with the mining part done from decentralized RAM instead of GPU or CPU which enhances decentralization. 

State Channels
State Channels are an innovative scaling solution that enables smart contracts to be executed off-chain. This solution enables infinite real-time transactions and can handle use-cases that require a high throughput of transactions. 

Oracles
Many smart contracts need viable real-world data in real-time to effectively be useful and Aeternity has an oracle system built-in to its blockchain.

Governance
Aeternity is governed by its stakeholders, which includes miners, token holders, and other participants with a stake in the blockchain. The stakeholders achieve governance through delegated voting. 

Naming System
Unlike some blockchains, Aeternity features user-friendly identities for blockchain entities, such as user accounts, oracles, contracts, etc.

Aeternity Issues and Controversies

Aeternity aspires to become the leading smart contract blockchain platform on the market, meaning it’s a direct competitor with Ethereum, EOS, Tron, Cardano, and many other more established cryptocurrencies. 

Therefore, Aeternity has a long way to catch up if it hopes to steal market share from Ethereum or any of the others. At the time of writing, Aeternity ranks #82 on CoinMarketCap meaning it’s a fairly illiquid coin and shows that it doesn’t have much backing by big investors. 

Another thing in which some people view as an issue is Aeternity’s on-chain governance model through delegated voting. Some people believe this governance model has too many potential risks and unintended consequences. 

For instance, most of the voting power is placed in the hands of AE holders rather than miners, users, or developers. Therefore, AE distribution may be skewed as a small group of people strive for control over the blockchain. Also, it’s incredibly hard to get a large number of people to vote and many votes will be uneducated, to begin with. 

All in all, Aeternity is an ambitious project attempting to be a very generalist solution that can be applied to any situation involving smart contracts or dapps. This generalist approach can make it hard to see Aeternity’s value proposition when there are already so many crypto projects competing for the same thing. 

Aeternity Partnerships & Working Products

Aeternity’s ecosystem of partnerships, products, communities, foundations, etc. is surprisingly big. It’s not nearly as big as Ethereum’s ecosystem, but it’s still pretty impressive. 

Helping to grow the Aeternity ecosystem is the Incubator Foundation, which is a nonprofit foundation supporting open-source developers, entrepreneurs and young businesses that build their projects on æternity. 

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Since the establishment of the foundation, they have paid out 36 grants with a focus on the following categories: 

  • Open source development
  • Research and education
  • Community growth
  • Culture and art
  • Protocol maintenance
  • Protocol development
  • SDKs
  • Wallets and interfaces
  • æpps and integrations
  • Middleware backend API
  • Dev-tools

https://www.aeternitystarfleet.com/

Additionally, the project is constantly holding meetups and conferences throughout the world. The most notable conference they hold is called Starfleet and it’s taking place in India on January 27, 2020, in Bangalore. This conference is being marketed as an accelerator for startups utilizing Aeternity blockchain and should see some new products and partnerships as a result. 

As for Aeternity partnerships, the project doesn’t list any directly on their website, but I managed to find some notable ones which are listed below:

  • Trakia Tech
  • Comrade Cooperative
  • Microsoft Innovation Center (MIC)
  • Crowdholding
  • Uruguay Can
  • Erlang Solutions
  • AionConnect
  • DSTOQ Exchange

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According to the Aeternity documentation hub, the Aeternity has 8 different æpps including:

  • AirGap
  • Base æpp
  • Waellet
  • Ledger Nano S
  • Hybrid Voting
  • Token Migration
  • Naming Example
  • The Drone Graffiti æpp

Also according to the documentation hub, Aeternity has 10 different developer tools for building on the Aeternity blockchain:

  • Blockchain Explorer
  • FireEditor
  • Contract Editor
  • Token Faucet
  • Playground
  • Goggles
  • AEKnow Explorer
  • AEMonitor
  • Node.js/MongoDB Middleware
  • Aeternity Blockchain Explorer & API Endpoint

Conclusion

Aeternity appears to be a solid project with some promising innovations for blockchain scaling. The project’s mainnet and blockchain are fully launched and the team is hosting meetups and conferences to drive its development and adoption.

However, Aeternity has a ways to go before it establishes itself as a leading blockchain platform in this crowded world of crypto. Its main challenge will be to catch up with more established blockchains, namely Ethereum, as these are Aeternity’s direct competitors. 

That being said, Ethereum is suffering major scaling issues and if Ethereum 2.0 fails, Aeternity has a chance to gain major market share. After all, Aeternity’s team believes their scaling solutions can take blockchain further.

What do you think about Aeternity (AE)? Is there room for multiple smart contract blockchain platforms? 

Let me know what you think in the comment section below.


Mr.CryptoWiki
Mr.CryptoWiki

In crypto since 2002 ;)


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