Ethereum (ETH)

Ethereum is a blockchain that can run small programs called smart contracts. If Bitcoin is like a shared record book for money, Ethereum is like a shared computer that anyone can use, where the results are recorded publicly.

Its built-in currency is called ether (ETH). Ether pays the fees, called gas, for using the network.

Ethereum was proposed in a 2013 white paper (opens in a new tab) by programmer Vitalik Buterin, then 19. He and several co-founders, including Gavin Wood and Joseph Lubin, built it so blockchains could do more than send money, such as run agreements and apps.

Today, development is coordinated by many independent teams and supported by the nonprofit Ethereum Foundation.

1. 2013

   Vitalik Buterin publishes the Ethereum white paper.

2. July 30, 2015

   The Ethereum network launches.

3. 2016

   After a large hack of a project called The DAO, the network splits. Ethereum continues with a fix; the original chain continues as Ethereum Classic.

4. August 2021

   The London upgrade starts destroying (“burning”) part of every transaction fee.

5. September 15, 2022

   The Merge: Ethereum switches from mining to proof of stake.

6. April 2023

   Stakers can withdraw their staked ether for the first time.

7. March 2024

   The Dencun upgrade lowers costs for “layer 2” networks built on Ethereum.

A smart contract is a program stored on the blockchain that runs exactly as written when someone uses it. For example, it could hold funds and release them automatically when certain conditions are met.

Every action costs a small fee in ether, called gas, which pays the network for the computing work and discourages spam.

Instead of miners, Ethereum is secured by validators who lock up (“stake”) ether as a security deposit. They check and propose blocks, earn rewards for honest work, and can lose part of their stake for cheating. This is called proof of stake.

Ethereum is the network. Ether (ETH) is its currency. People often say “Ethereum” for both, but the difference matters.

Apps built from smart contracts are called decentralized applications, or dapps. Examples include tools to trade tokens, lend and borrow (often called “DeFi”), issue stablecoins, and create digital collectibles. Ethereum.org lists many dapps (opens in a new tab).

“Decentralized” doesn't mean safe. Smart contracts can have bugs, and many scams also run as dapps.

• It is built to run programs (smart contracts), not only to send money.
• It uses proof of stake instead of mining.
• Ether has no fixed maximum supply; new ether is issued to validators while part of each fee is burned.
• It has one of the largest ecosystems of apps, tokens, and developers.

• 1

  The smallest unit of ether is called a “wei,” named after computer scientist Wei Dai.

• 2

  Vitalik Buterin was 19 when he wrote the Ethereum white paper.

• 3

  The Merge in 2022 changed how Ethereum is secured while the network kept running, often compared to changing a plane's engine mid-flight.

• Myth: Smart contracts are legal contracts.

  Fact: They are computer programs. They may or may not match any legal agreement, and they do exactly what the code says, even if that's a mistake.

• Myth: Ethereum has a fixed supply like Bitcoin.

  Fact: Ether has no hard cap. Its supply depends on new issuance and how much is burned through fees.

• Myth: Anything built on Ethereum is approved by Ethereum.

  Fact: Anyone can deploy a smart contract. Nobody reviews or approves them.

Specific to Ethereum

• Smart contract bugs and hacks have caused large losses.
• Fake tokens and look-alike apps are common. A token's name or logo doesn't prove it's genuine.
• Signing a transaction in a wallet can give an app permission to move your tokens. Only connect to sites you trust.

For every cryptocurrency

• Prices can rise or fall sharply, sometimes within hours. Only people who can afford to lose the money should consider buying any cryptocurrency, and CLC does not recommend buying, selling, or holding any.
• Transactions usually can't be reversed. If you send to the wrong address, or to a scammer, the money is usually gone.
• Whoever controls the keys controls the coins. Anyone who learns your recovery phrase can take everything. No real company or helper will ever ask for it.
• Scammers use well-known names. Fake giveaways, “guaranteed returns,” and impersonated celebrities or companies are common. Learn the warning signs in our Resource Center.
• Rules differ by country and can change. Taxes may apply when you sell or spend cryptocurrency.

Smart contract

A program stored on a blockchain that runs as written.

Ether (ETH)

Ethereum's built-in currency.

Gas

The fee for computing work on Ethereum, paid in ether.

Proof of stake

Security method where validators lock up funds as a deposit.

Validator

A participant who checks and proposes blocks.

Dapp

A decentralized application built from smart contracts.

Company and project sources describe their own products; we cite them for what the products do, not as endorsements. Last reviewed October 19, 2026.

• What is Ethereum? (opens in a new tab)ethereum.org
• Ethereum white paper (opens in a new tab)ethereum.org
• Introduction to smart contracts (opens in a new tab)ethereum.org
• Proof of stake (opens in a new tab)ethereum.org
• The Merge (opens in a new tab)ethereum.org
• Ethereum history and upgrades (opens in a new tab)ethereum.org