Electroneum Review

Electroneum Token Review: Mobile Mining Creates a Payment Ecosystem

Electroneum in Brief

Electroneum has a mobile-first strategy to become a medium of exchange rather than a speculative asset. Android users around the world can already mine Electroneum’s token, the ETN, from their smartphone. The project’s success, however, may depend more on business acumen than on crypto technology.

This CoinIQ Electroneum token review will explain the project’s vision and its development in the year since its initial coin offering.


  • Vision promises a path to crypto as currency rather than investment asset.
  • Android app supports wallet, mining and (soon) mobile payments.
  • Mobile mining apps could spur widespread adoption.


  • Unproven business model as the payment infrastructure is still in beta.
  • Little support from mainstream exchanges.
  • Original white papers are hard to find, thin on technical details and obsolete.
  • Android app reviews are filled with fans posting their referral codes.
  • No app for iOS.

Exchanges that list ETN

According to CoinMarketCap, the following crypto exchanges list Electroneum: Bitbns, CoinBene, Cryptomate, Cryptopia, KuCoin, Liquid, OEX and Tradeogre. Electroneum lists several smaller exchanges that support ETN trading.

Electroneum’s History

Targeting developing markets
Source: Electroneum

The Electroneum development team wants their project to become the first digital currency used for daily consumer spending. This was Satoshi Nakamoto’s original hope for Bitcoin as well, but that goal never materialized because high prices and extreme volatility turned Bitcoin into a speculative asset.

This is how founder Richard Ells described his original goal:

“Wouldn’t it be lovely to make a cryptocurrency that is completely accessible to everybody? Literally without any technology skillset at all.”

A mobile-first approach unique among cryptocurrency projects lies at the heart of Electroneum’s strategy. Anyone who downloads the Electroneum mobile app becomes an Electroneum miner and receives ETN tokens into app’s mobile wallet. The app will also have a digital payment system, which will let people spend their ETN on mobile minutes or at local retailers.

“Everybody who uses the Electroneum app will be given some Electroneum…. So we’re paying you to have a digital payment solution,” Ells explained in a series of promotional videos. “Once they’re down that rabbit hole of cryptocurrency because they’ve got some. They are likely to want to spend it.”

“What we’ve actually done is created the world’s first cryptocurrency that’s genuinely being used for trade rather than just speculation.”

With more than 2.2 billion people worldwide using mobile phones, Ells is optimistic about Electroneum’s prospects. “The user numbers we could get are absolutely gargantuan.”

The path to Electroneum

Ells assembled a small team to begin blockchain development in 2015. By the middle of 2016, they had solid financial and technological foundations in place and formally launched as Electroneum, Ltd.

Making cryptocurrency as easy for people to use as traditional cash has been a goal for Electroneum’s development team since its inception. At 21 billion ETN, for example, Electroneum’s total monetary supply is 1,000 times larger than Bitcoin’s. The large supply makes the smallest fractional holding, 0.01 ETN, much easier to understand than Bitcoin’s satoshi.

A company document describes the “more human” experience you get when using ETN. The price of a can of Coca-Cola, for example, could be 99 ETN which is easier to deal with than 0.01374 BTC.

Overwhelming reception

The ICO went so well that, rather than grabbing more money, the team ended the fundraising campaign as soon as it hit the cap. Electroneum’s leadership wanted to signal their focus on long-term strategy rather than short-term gain.

More than 120,000 contributors took part in the ICO, dwarfing the previous record of 10,000 contributors set by Tezos. Electroneum became one of the 30-largest cryptocurrencies in the world by volume, although CoinMarketCap now ranks it around number 50.

Security threats

Bug bounty program
Source: HackerOne

Electroneum’s initial popularity turned the coin into a target. More accurately, it turned Electroneum’s users into targets. People who reused email addresses and passwords from other services were particularly vulnerable to attacks. Last November, Hackers tried to break into their accounts using lists of stolen identity information.

Electroneum quickly detected the bogus login attempts and froze its digital wallet. That meant nobody in the Electroneum community could get their tokens, but it also kept the coins safe.

The project hired a security company called HackerOne which has worked for the US Department of Defense, Starbucks and Coinbase. In the end, nobody lost any of their tokens. Electroneum finally launched in mid-December, six weeks after its planned November 1 launch date. The project now sponsors a HackerOne bug bounty program that rewards white hat hackers when they find a security vulnerability.

Pivoting to emerging markets

The pre-ICO documentation pitched Electroneum’s potential for the gambling and online gaming markets. The new cryptocurrency would bridge in-game currencies with the real-world economy, creating more opportunities for game makers and giving gamers more ways to use their in-game loot. Gamblers would also have an easier time using cryptocurrency.

Electroneum’s messaging in 2018 no longer addresses those markets and focuses on creating real-world cryptocurrency ecosystems in developing economies. Citing a PwC study, Electroneum targets the 350 million smartphone users in the developing world.

Many people across the Americas, Africa and Asia do not have bank accounts, much less access to bitcoin and other cryptocurrencies. But they do have mobile phones. Carriers who integrate with the Electroneum app’s payment system can lower their customers’ costs of ownership and unleash a wave of mobile commerce.

Ells explains the concept in the project’s promotional video: “If you know you are in a village of 200 people that have got some cryptocurrency, and you go ‘You know what? I’m going to be the first person who sells… a physical product for Electroneum, then I know I’ve got people who have got Electroneum.”

“We are dropping Electroneum onto people’s mobile phones around the world. What I’m hoping is that entrepreneurial spirit means that people will start swapping it for real things.”


Leaders of electroneum
Source: Electroneum

Electroneum’s founder, Richard Ells, is a software developer and entrepreneur. He founded several technology companies, including the enterprise social media dashboard Retortal. He took up cryptocurrency mining as a hobby in 2014 and soon developed the concept that became Electroneum

“It was all initially part-time, in the evenings and weekend, fiddling around with blockchain,” Ells recalled.

Today, Ells leads a global team dedicated to integrating Electroneum into the modern mobile lifestyle.

  • Chris Gorman, director: Gorman founded the e-commerce website developer Reality Group and went on to hold a series of directorships in Britain’s technology sector.
  • Nick Cook, chief operating officer: Cook spent a seventeen-year career in the European automotive industry where he worked on enterprise systems.
  • Barry Last, chief technology officer: Most of Last’s career as a developer was spent at the automotive e-commerce provider GForces, where he rose to the position of solutions architect. Last applies those skills to developing Electroneum’s infrastructure.
  • Mark Robinson, advisor: Robinson was the CEO of cleantech company APC Technology Group. He is also a director of Retortal and the founder of blockchain developer Developeum.
  • Andy Denton, advisor: Denton specializes in gaming and fintech and is a senior product director at The Workshop.

What Does the Electroneum Blockchain Do?

Mining electroneum
Source: Electroneum

Fundamentally, Electroneum is a mobile payments system. The mining capabilities of the Electroneum app give users an initial stream of tokens that lets them start paying with crypto. That instant pool of Electroneum holders creates opportunities for local businesses.

If Electroneum becomes the success Ells and his team hopes, the network effects that come with mobile integration will make Electroneum a powerful force in the crypto payments space. With 2.2 billion mobile users worldwide, Electroneum could become the de facto standard for crypto payments.

The infrastructure needed to make this happen is still in development. The instant payment system is currently in a beta test phase and an application programming interface (API) to let mobile commerce companies integrate with Electroneum is still in the works.

Know Your Customer

Electroneum promotes itself as the first cryptocurrency to comply with Know-Your-Customer (KYC) regulations. In order to fulfill its vision, Electroneum must partner with mobile carriers, payment processors and large financial institutions. These companies can only work with other companies who comply with EU and other KYC requirements.

“The message we’ve been getting from the corporate world has been very clear: no KYC, no partnership,” Ells explained in a blog post last month.

Electroneum implemented a 3-tier verification system to make things easier. Everyone must complete Level 1, which requires your name, country of residence and timezone. In exchange for completing Level 1 verification, you can use up to €150 worth of ETN every 3 months. At Level 2, you must provide documents that prove your identity and residency. Passing Level 2 lets you use up to €10,000 worth of ETN every 3 months. To use more than that, you must pass Level 3 verification, which requires documents that prove your finances can handle those kinds of transactions.

The KYC requirements only apply to people making ETN-based transactions through Electroneum’s systems such as the mobile app. ETN held in 3rd party exchanges aren’t subject to the project’s KYC requirements — but those exchanges may have their own verification processes.

Which dApps run on Electroneum’s blockchain?

Electroneum is not a dApp platform, but will have an API that will let mobile commerce companies and mobile carriers integrate Electroneum payments into their services. The API is still in development.

How Does Electroneum’s Blockchain Work?

Based on Monero
Source: Electroneum

When the founding team first kicked off development of Electroneum, they wanted to use CryptoNight’s proof-of-work consensus algorithm. At first, they planned to make Electroneum a Bytecoin fork, since that would have made the development relatively easy.

With the rapid success of the ICO, however, the team suddenly had the resources to hire experienced developers. In October 2017, they announced that Electroneum would instead be based on Monero. With a more stable and well-developed ecosystem, Monero promised to form a stronger foundation for the new cryptocurrency.

Yet, the Monero base code was only a starting point. Electroneum’s focus is on becoming the world’s micropayment system. That goal does not require privacy features as extensive as those Monero offers. An April blog post explained how Electroneum would start diverging from Monero.

“As we move towards a lean, fast blockchain to handle vast numbers of micropayments we need to lose some of the overhead that comes with the privacy of Monero.”

Electroneum began rolling out these changes in its June update. “We’ve got a much faster, leaner blockchain,” Ells explained in a video update. “We can get more transactions per block — our block size is slightly bigger…. So we’re much faster…. By removing some of the privacy-focused stuff it’s enabling our regulation push in Gibraltar, Japan and London.”

Mobile Mining and Desktop Mining

One of the keys to Electroneum’s widespread adoption is making the mining process accessible to as many people as possible. That means cutting out the large consortiums that dominate Bitcoin and Ethereum mining.

The Electroneum blockchain’s code does not work well on custom ASIC chips or on high-end graphics process. That leaves people free to use their desktop computers to earn rewards for processing blocks on the blockchain.

More importantly, Electroneum’s mobile app supports mining. “Everybody who uses the Electroneum app will be given some Electroneum for having the app,” Ells explained in a promotional video.

The mobile mining feature went live in March 2018, but only on Electroneum’s Android app. At the time, Electroneum had to change certain functions to comply with Apple’s rules. A Reddit post in August announced the app was within weeks of hitting the App Store. It is still unavailable.

Electroneum provides desktop apps for Windows, Linux and macOS as well as support for mining pools and virtual servers. Unlike the mobile users, these miners do the heavy lifting to ensure blocks get added to the blockchain quickly.

How Are Electroneum Tokens Distributed?

The Electroneum ICO launched in mid-September 2017, with a total distribution of 6.3 billion ETN. With an offering price of USD $0.01, and several discount levels for early purchases, this represented a hard cap of $40 million. The ICO would run through the end of October 2017 or until all 6.3 billion coins had been purchased. Any remaining coins would go into the fund for mining bonuses.

Electroneum did not reveal how much ETN employees, investors and insiders received before or after the ICO.

Does Electroneum Have a White Paper and Blockchain Explorer?

Electroneum has two documents, a technical white paper and a business-focused overview white paper. Neither are featured prominently on the Electroneum website, but both are still accessible.

The technical white paper was written in advance of the ICO when the project’s developers still planned to base their new cryptocurrency on CryptoNote. With the switch to a Monero-based design, much of the technical white paper is obsolete.

The technical white paper is still useful for gaining insights into Electroneum’s approach to mobile design. Previous attempts to create mobile mining apps ran into issues with bandwidth, performance and battery life. Electroneum’s woud address this by not downloading the entire blockchain or carrying out the intensive CPU operations needed to write blocks on the blockchain. Given the diversity of the mobile ecosystem, especially among Android devices, the consensus algorithm would assign each app a hash rate that reflects the device’s capabilities.

Nevertheless, more than one critic has pointed out the lack of technical details in Electroneum’s technical white paper. An updated, post-Monero white paper hasn’t been released, so there’s no way to independently assess the project’s technology.

Electroneum blockchain explorer

Electroneum provides a simple, web-based blockchain explorer. Unlike other projects’ explorers, this one does not provide aggregate statistics. All you can do is view the outstanding transaction pool and view a list of the previous transactions grouped by block.

Where Does Electroneum Stand Now?

By April, the project had more than 1.2 million users and more than 100,000 mobile miners. The Electroneum website now claims more than 2.5 million users.

However, the website also says the mobile payments system was due to launch in the third quarter of 2018. Almost halfway through the fourth quarter, Electroneum’s main feature still hasn’t been released.

Electroneum has signed several agreements with companies in the mobility and payments sectors. American payments company XIUS signed a memorandum of understanding (MOU) with Electroneum that could integrate Electroneum payments in XIUS Latin America payment network.

Belgian mobile operator Effortel also signed an MOU. The company provides MVNO services for retailers and mobile operators in Europe and Africa. Electroneum has not published details of the agreement.

Final Thoughts

Electroneum’s mobile-first approach to crypto payments looks like a smarter business strategy than many blockchain projects’ Field of Dreams approaches. The mobile apps give end users a financial incentive to run the Electroneum app and earn ETN. Letting carriers create ETN-based payment ecosystems gives the users a viable use case for spending the ETN that they mine.

On the other hand, there are many Western crypto companies promoting their payment systems as solutions to emerging economies’ woes. Electroneum’s success may depend less on technology and more on its leadership’s ability to close deals.

Christopher Casper

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