Ethereum (ETH) is a second generation cryptocurrency. Launched in 2015, Ethereum has much in common with its first generation counterpart, Bitcoin.
Like Bitcoin, Ethereum uses distributed ledgers and cryptography to facilitate digital transactions. However, Ethereum is much more than a medium of exchange. It uses blockchain technology to monetise and facilitate self-executing programmatic contracts via its native token, ether (ETH).
Ethereum is widely regarded as the hottest platform in the crypto world with a wide range of data friendly services. Though Bitcoin is bigger than Ethereum by volume, Ethereum is faster than its first generation counterpart with the ability to validate transactions in seconds.
Use these guides to learn more about what it does, how it works, and how you can invest in it from Australia.
What is Ethereum?
Created by Vitalik Buterin in 2013, Ethereum is a decentralised peer-to-peer platform that allows you to exchange money or enter into contracts with other people without going through an intermediary.
Ethereum was conceived with the aim of putting real-world assets on the blockchain. Its blockchain is programmable and can be used to exchange a variety of digital assets in addition to cryptocurrency.
You can explore a broad range of decentralised applications (dApps) on Ethereum including decentralised finance (DeFi) applications which enable financial services that do not require a central authority or financial intermediary such as a bank, exchange, or brokerage. You can also create and exchange non-fungible tokens (NFTs) on Ethereum as proof of ownership for digital works of art or other types of digital property.
Ethereum has used blockchain technology to facilitate smart contracts, transaction protocols that run when predetermined conditions are met. These contracts make transactions immutable, traceable, and transparent. Regardless of your background and location, you can use Ethereum both as a medium of exchange and store of value.
Every time you send ETH or use a decentralised app on Ethereum, you pay a small fee in ETH in order to use the Ethereum network. This fee gives miners an incentive to process and verify what you're trying to do.