Ethereum

Ethereum is a programmable blockchain platform with the capacity to support smart contracts, DAPPs (decentralized apps), and other DeFi (decentralized finance) projects.

The Ethereum platform launched in 2015, and it’s now the second largest form of crypto next to Bitcoin (BTC).

Ethereum is the foundation for building apps and organizations in a decentralized, permissionless, censorship-resistant way.

In the Ethereum platform, there exists a additional abstract layer, a single canonical computer called Ethereum Virtual Machine (EVM), whose state everyone on the ethereum network agress on.

Everyone who participates in the Ethereum network (every Ethereum node) keeps a copy of the state of this computer. Additionally, any participant can broadcast a request for this computer to perform arbitrary computation. Whenever such a request is broadcast, other participants on the network verify, validate, and carry out ("execute") the computation. This execution causes a state change in the EVM, which is committed and propagated throughout the entire network.

Requests for computation are called transaction requests; the record of all transactions and the EVM's present state gets stored on the blockchain, which in turn is stored and agreed upon by all nodes.

The Ethereum native token is the Ether (ETH), and it’s used to fuel operations on the blockchain.

In the Ethereum network, ether serves several key purposes:

1. Transaction fees:

• Ether is charged for transactions and computation services. Users are required to pay a small amount of Ether to miners as a fee for processing transactions whenever they execute smart contracts or transfer tokens. The fee increases the incentive for miners to accept and add transactions into blocks on the Ethereum blockchain.

2. Smart Contract Execution:

• On the Ethereum blockchain, ether is necessary to execute Smart Contracts. Smart contracts are agreements that implement predefined rules and conditions, written in the code. A certain amount of Ether is consumed every time a Smart Contract is triggered or terminated in order to cover the computing power required by an Ethereum Virtual Machine (EVM), for processing and executing code.

3. Store of Value:

• In the Ethereum platform, ether is also used to store value and digital assets. Some users believe that Ether is an investment and are betting on its future value increase. Additionally, Ether can be used as collateral for decentralized finance (DeFi) applications, lending, borrowing, and other financial services within the platform.

Please refer below for detailed explanation and understanding:

• Ethereum white paper: click here
• Ethereum official website: click here