Ethereum (ETH) is the native cryptocurrency of the Ethereum blockchain, an open-source decentralized platform that enables the creation and execution of smart contracts and decentralized applications (dApps).1
Here is a detailed overview of Ethereum:
What it is: Ethereum is more than just a digital currency; it is a programmable blockchain.3 This programmability stems from its support for smart contracts, which are self-executing contracts with the terms of the agreement directly written into code.4 These contracts are automatically executed5 when predefined conditions are met, without the need for intermediaries.6
Date:
Vitalik Buterin, the programmer and co-founder of Bitcoin Magazine, first proposed the concept of Ethereum in late 2013 in a white paper.7
Buterin envisioned a blockchain that could do more than just facilitate peer-to-peer digital cash; he wanted a platform for building decentralized applications.8
The Ethereum project was announced at the North American Bitcoin Conference in Miami in January 2014.9
A core team, including Vitalik Buterin, Mihai Alisie, Anthony Di Iorio, and Charles Hoskinson, worked on developing the platform.
In July 2014, a successful online crowdsale raised over $18 million in Bitcoin to fund the project.10
Ethereum's blockchain was officially launched on July 30, 2015, with its initial release "Frontier."11
Since its launch, Ethereum has undergone several significant network upgrades (hard forks) to improve its functionality, security, and scalability.12 Notable upgrades include Homestead, Metropolis (Byzantium and Constantinople), and the Ethereum Merge in September 2022, which transitioned Ethereum from a proof-of-work (PoW) consensus mechanism to a proof-of-stake (PoS) mechanism, significantly reducing its energy consumption.13
How it works:
Ethereum operates on a decentralized ledger technology called blockchain, where all transactions are publicly and transparently recorded across a distributed network of computers.14
Ethereum (ETH) is the native cryptocurrency used to pay transaction fees, known as "gas," and computational services on the Ethereum network.15
The shift to proof-of-stake (PoS) means that network participants, known as validators, stake their own Ethereum coins to validate transactions and secure the network, replacing the energy-intensive mining process used in proof-of-work.16
The Ethereum Virtual Machine (EVM) is the runtime environment for smart contracts on Ethereum.17 It allows developers to write and deploy decentralized applications in different programming languages, which can be compiled into executable binary code for the EVM.18
Use Cases: Ethereum's versatility has led to a wide range of use cases across various sectors:
Decentralized Finance (DeFi): This is one of the most prominent use cases, including decentralized lending and borrowing platforms (such as Aave and Compound), decentralized exchanges (DEXs) (such as Uniswap and SushiSwap), stablecoins, and yield farming protocols.19 These Ethereum smart contracts automate these financial services without the need for traditional intermediaries.20
Non-Fungible Tokens (NFTs): Ethereum is the dominant blockchain network for creating and trading non-fungible tokens that represent ownership of unique digital or physical assets such as art, music, collectibles, and virtual real estate.21
Decentralized Autonomous Organizations (DAOs): These are organizations led by a local community and governed by software on the blockchain.22 Smart contracts define the rules and governance of the organization, allowing for transparent and automated decision-making.
Gaming (GameFi): Ethereum is integrated into the gaming industry through non-fungible tokens (NFTs) for in-game assets, play-to-earn models, and decentralized gaming platforms.23
Supply Chain Management: Blockchain technology can enhance transparency and efficiency in supply chains by tracking and verifying goods.24 Ethereum can be used to build these decentralized tracking systems.25
Digital Identity: Ethereum can be used to create self-sovereign identity solutions, giving individuals more control over their digital data.26
Tokenization of Real-World Assets (RWAs): Real-world assets, such as real estate, commodities, and equities, are increasingly being tokenized on the Ethereum blockchain, making them more accessible and potentially more liquid.
Stablecoins: Many stablecoins, which are digital currencies pegged to stable assets like the US dollar, are built on the Ethereum blockchain (such as USDC and DAI).27
Enterprise Solutions: Many enterprises are exploring and creating applications on private or consortium versions of the Ethereum blockchain for use in applications such as supply chain tracking, data management, and financial tools.28
Current Price: As of Friday, May 16, 2025, the current price of Ethereum is approximately $2,605.54. Please note that cryptocurrency prices are highly volatile and can change rapidly.
