Ethereum ETH

Project profile

Ethereum is a public blockchain and programmable execution network that launched in 2015. Its Ethereum Virtual Machine (EVM) executes smart contracts, while network participants verify transactions and agree on shared state. Developers can deploy programs without obtaining permission from a central platform operator, creating infrastructure for applications that manage assets and coordinate activity through code. Ether (ETH) is Ethereum’s native asset. On Ethereum mainnet, transaction fees are paid in ETH, while gas measures the computational resources consumed by a transaction; gas is not a separate token. Transfers, contract deployment and contract interactions consume resources, with fees affected by execution requirements and demand for block space. ETH can also be transferred, held or used as collateral within applications. Ethereum supports decentralized finance, stablecoins, NFTs and other applications, but these protocols and their tokens are separate from the underlying network and ETH. Each application has its own contracts, governance and risks. Wrapped ETH (WETH) uses a wrapping contract to hold ETH and represent the deposited native asset as an ERC-20 token for use in applications. In standard wrapping, depositing 1 ETH creates 1 WETH; unwrapping burns the WETH and releases the same amount of ETH. Ethereum moved from proof-of-work to proof-of-stake in 2022. Validators stake ETH, propose blocks and attest to their validity, helping the network reach consensus. Protocol rewards encourage correct participation, while missed duties can incur penalties and certain conflicting or dishonest actions can trigger slashing of staked ETH. Pooled and liquid staking provide other participation routes, with additional operator and smart-contract considerations. ETH has no Bitcoin-style fixed maximum supply. The proof-of-stake protocol issues ETH to reward validators, with issuance influenced by the total amount staked. Under EIP-1559, the base-fee portion of transaction fees is destroyed, while priority fees go to the block proposer. ETH supply is jointly determined by issuance and burning. Issuance adds supply, while burning removes it and varies with network usage; the balance of these flows produces net supply growth or contraction. Layer 2 networks extend Ethereum’s capacity by moving transaction execution away from mainnet. Rollups batch transactions and submit data and state commitments to Ethereum, using it for settlement and data availability. Optimistic rollups and validity-proof rollups verify results differently. Security also depends on the implementation, bridge, sequencing and upgrade controls, which together shape each L2’s security model. Ethereum’s base layer and these execution networks play related but distinct roles.