Crypto glossary
Ethereum (ETH)
Ethereum (ETH) is a programmable blockchain that runs smart contracts and decentralized applications, with ether as the coin used to pay network fees.
Ethereum was proposed by Vitalik Buterin in 2013 and launched in July 2015. Where Bitcoin focuses on payments, Ethereum adds a general-purpose virtual machine, the EVM, on which developers deploy smart contracts. Those programs power tokens, decentralized exchanges, lending protocols, NFTs and stablecoins. Its native currency, ether (ETH), pays for gas and secures the network.
Ethereum switched from proof of work to proof of stake in The Merge on 15 September 2022, cutting its energy use by more than 99%, and validators now stake ETH to propose and attest to blocks. Since EIP-1559 in August 2021, part of every fee is burned. The network scales mainly through layer 2 rollups, which since the Dencun upgrade in March 2024 post their data cheaply in blobs.
Fees on the main chain can still spike when demand is high, and much activity has moved to layer 2 networks with their own security trade-offs. Smart contract bugs and exploits are a constant risk for users of applications built on Ethereum.
Example
Swapping tokens on Uniswap on the Ethereum main network means signing a transaction, paying a gas fee in ETH and waiting about 12 seconds for the next block to include it.
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