What Is Ethereum?

Ethereum is a decentralized blockchain platform that enables developers to build decentralized applications (dApps) on top of its blockchain. Launched in 2015 by Vitalik Buterin, Ethereum has become one of the most popular blockchain platforms in the world, thanks to its robust ecosystem, active community, and innovative features.

Ether (ETH) is Ethereum's native cryptocurrency and serves multiple purposes on the platform. It can be used to pay gas fees on the Ethereum network and as a means of participating in the platform's governance system.

Two of Ethereum's most important characteristics are its interoperability and scalability. The former refers to Ethereum's ability to connect and communicate with other blockchain networks and platforms, which allows for greater functionality and compatibility. Scalability, on the other hand, refers to Ethereum's ability to handle large volumes of transactions and data without compromising its performance or security.

In September 2022 Ethereum went through a major upgrade called The Merge, dubbed one of the most significant upgrade events for the industry because of its complexity. It involved the transition from the Proof-of-Work consensus algorithm to a more efficient Proof-of-Stake algorithm, with the purpose of reducing energy consumption, further improving scalability, and increasing security. Consequently, that mandated validation of the transactions on Ethereum to happen through the act of staking rather than mining.

Although much awaited, the Merge is just the beginning of a series of major updates Ethereum has to undergo in order for Vitalik’s vision to be completed.