On May 19, Electroneum cryptocurrency users received an email from the cryptocurrency creator announcing that phase two of the project would be coming into effect from that moment. If you do not know the cryptocurrency or the proposal it brought behind, in this article I intend to explain what Electroneum is, what phase two brings to the project and at the end of this brief explanation I will give my opinion on the subject.
What was Electroneum?
The electroneum was a cryptocurrency that can be mined with a cell phone, without the need for technical knowledge or experience. The big difference compared to other cryptocurrencies (like Bitcoin) is that it does not require expensive hardware and technical know-how to mine, it can be said that it was not even a real mining but rather an airdrop or "cloud mining" since it did not consume your cell phone battery like real mining would. Electroneum's mobile mining experience allowed anyone with a smartphone to earn ETN coins, thus attracting a potential market of 2.2 billion smartphone users worldwide. According to the cryptocurrency website itself, the idea was that airdrop would generate between 1 and 3 dollars a month in cryptocurrencies, making it attractive to peripheral countries where those few dollars (given the exchange rate) could bring some more significant return. The application had a very intuitive interface making anyone able to use it, even without prior knowledge about cryptocurrencies.
Realizing the difference this cryptocurrency was making in peripheral countries, the company behind the project started to expand its market by turning to these regions, making real mining (with asics) done only by NGO (non-governmental organization) focused on social projects; the company also expanded its area of activity when at the Mobile World Congress 2019 it announced its first Smart Phone, the one that would initially be marketed in Sub-Saharan Africa as an "experiment" with its price being U$80 and the features of the cell phone brought a very good cost benefit (The specifications of the cell phone are still available on the official website), the cell phone would come with the electroneum application already installed facilitating mining and attracting more people to the project, currently I have not found information about this experiment done and, according to the website , the cell phone is only available for purchase in Cambodia.
Finally, the electroneum gained a huge adoption with an average of 300,000 active 'miners' and real-life usability.
Electroneum Phase Two
In case you are not interested in watching the 10-minute video on the update, I will quickly go over the most important points mentioned here.
Initially, he talks about how phase one was successful and how other projects emerged from that, such as Any Task, which is a freelance platform focused on payments with electroneum. Then he comments that the mining of electroneum is over and the new way to "earn" electroneum is from Any Task selling their "digital skills" and that as this new phase of the project aims to be bigger and better, they quote that they have already brought to over 140 countries have the possibility to recharge their mobile phones and the next step is to make partnerships to make it possible to pay the electricity bill with electroneum (this conversation has already started in places like Nigeria, Mali, Gambia and Senegal). Finally, they mention how removing mining was beneficial for currency inflation, which fell from 9% per year to 4.1% and with the next fork scheduled for July, it intends to drop to 2%, equaling bitcoin and ethereum.
My opinion on the subject
I am (or was) a great Electroneum enthusiast, my first post on this site was exactly about him and the advantages it brought, the project presented me with something very solid with a real humanitarian proposal, when I joined reddit or even on twitter we could find countless reports of communities that have adopted ETN as their currency, people buying food, clothes and personal utensils, this has provided these often needy and neglected communities with an economic turn that can make people's lives easier by adding the opening of the world of cryptocurrencies to people who possibly would never think about. Phase two of the electroneum, comes back and neglects these people.
For starters, NEVER BEFORE the update mentioned a phase 2, the whitepaper (which was deleted from the official website but can still be read on alternative sites) said that the electroneum was meant to be a cryptocurrency to be mined on the cell phone, it would seek adoption en masse and would bring extra functionality beyond mining but making it clear that mining would be the focus.
Anytask is a great tool developed by the electroneum team as it brings even more usability mainly to cryptocurrency and attracts some attention from outside the bubble where the initial marketing was done, however when replacing mining with AnyTask the company ends up excluding those who do not own "digital skills" that can be commercialized. As soon as you enter the site you realize that the most coveted skills are things like Graphic Design, it is not a problem at all, it is actually the most expected when entering a site like this, but as a person who does not understand much of technology that was called for the proposal of mining by cell phone would be able to fit on that platform. A long time before AnyTask took the mining, I signed up and used it for some time, I developed a basic graphic analysis mini-course and made it available, there was no one interested in my product, that was not a problem because I continued with mining in cloud that the electroneum provided me and with that I even consumed some of the works they had there.
The electroneum will have a maximum of 21 billion coins mined, based on the fact that the project intended to contribute between 1 and 3 dollars a month (in the account I will use 3) in ETN, an average of 300 thousand monthly users and using current quote of 0.07 we have that the electroneum would have to distribute 428.57 per user, which would give a total of 128.571.000 distributed monthly. This is equivalent to 0.006% of the total capacity to be mined, given that we are in just under 50% of the maximum capacity (but I will use 50% to facilitate the account), it would take 833,33 months to reach the maximum capacity, that is clear if the maximum distribution was aimed at cloud miners, which is not the case but there is still a very long time of mining and distribution before reaching the max supply. So having that estimate on top, what is the need to remove mining now? Why not bring some kind of warning before removing mining?
Finally, I would like to bring the following sentence that was at the end of the email sent to users talking about phase two:
Most cryptocurrencies are only used by crypto enthusiasts. ETN is used by real people.
This was really true for some time, but in my opinion this update came to break this reality, what phase two brought to users was a departure from the original proposal, the main users who used, supported and marketed electroneum are in areas where their technological knowledge will not favor them in this new venture that is AnyTask, which can bring numerous disadvantages such as abandoning the project and perhaps even cryptocurrencies in general. On the other hand, in the long run there may be a very large appreciation in the price of cryptocurrency given the same factors mentioned above, this approach to the more traditional market and the possibility of negotiating its "digital talents" can bring new users, but I do not believe that I'll still be around to see, which is a shame because the electroneum was a unique project..
Thank you for reading :D