It’s all automatic. The smart contracts execute all processes, starting with song recognition and ending in the monetary transaction whereby the artist receives the remuneration almost instantly. Middlemen are not needed anymore. The result is a fairer exchange.
So far, Ethereum has been doing a great Job in being an underlying basic computer structure. To develop and maintain a separate and entirely new blockchain is difficult. The security level has to be absolute. Many companies therefore choose to build on the Ethereum blockchain. This makes it possible for smaller companies to use blockchain technology.
Every transaction which goes through the Ethereum network is being paid in ether. Ether is the cryptocurrency of the Ethereum ecosystem. To counter the volatility of cryptocurrency markets, a new unit has been instroduced, gas. The regular price for a transaction is 21000. To keep this prize stable, even when the prize of ether fluctuates, the two units are kept separated.
Although the Ethereum ecosystem is using ether, attached companies can create their own tokens, if they wish, They are called ERC20 tokens. These don’t need their own wallets, but can be used with an Ethereum address. Examples: Omisego, Tenx, Civic, Link…
The DAO Hack
In 2016 a completely Decentralized Autonomous Organisation (DAO) had been created, which was funded through a crowdfunding even and collected around 150 Mio $. An unknown person was able to exploit a bug in the code withdrew the money. In order to make the money unusable and to protect the early investors, the network underwent a incompatible software upgrade, a hard fork. Some community members saw the iron rule code is law, broken. For this reason the old branch, which was left to die, was being kept alive by some community members which resulted in 2 Ethereum networks: Ethereum (ETH) und Ethereum Classic (ETC)
ETH and ETC left these initial difficulties way behind. Ethereum has become the major player in platform technology and is the second largest cryptocurrency by market cap, while ETC has been developed into a legit platform on its own, although much smaller. Well respected developers have joined the ETC project and keep developing it.
Famous figures are Vitalik Buterin and Dr. Gavin Wood for ETH, who are co-founders of Ethereum. Vitalik Buterin, who invented ETH when he was 17 years old, has become some sort of rockstar in the blockchain space.