An Ether is a unit of a cryptocurrency which is used to settle payments within the Ethereum blockchain platform. Ethers are generated as payment to miners – entities which create new blocks to add to the blockchain at the rate of 5 Ethers per block. A maximum of 18 million Ethers can be created every year.
Although the Ethereum system is open-source, it is proprietary in that it is managed and developed by the Ethereum Foundation, which is headquartered in Switzerland. The system was developed by Russian computer scientist Vitalik Buterin.
The Ethereum system is designed to function as a platform which enables many different kinds of applications – much like computer operating systems function as platforms on which programs can be run. The Ether provides a tool through which value can be transacted between Ethereum applications. In this way, Ether is better described as a utility token than a cryptocurrency.
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