What is Ethereum?
Ethereum is a public blockchain that, besides moving money, runs programs called smart contracts. Its native coin, ether (ETH), pays the network fees. This guide explains the core ideas in simple terms.
What is Ethereum?
Ethereum is a decentralized network launched in 2015. It is built not only to hold money but to act as a shared global computer on which anyone can deploy programs.
Bitcoin is mainly known for transferring and storing value, while Ethereum is a programmable platform.
What is a smart contract?
A smart contract is a program stored on the blockchain that runs automatically under rules set in advance, with no middleman. For example, it can hold funds until a certain condition is met.
Smart contracts power tokens, decentralized exchanges, lending and escrow systems. A bug in a contract can cause real losses, so trust only contracts that have been reviewed.
Each smart contract has its own address, like an account, and anyone can inspect its code and transactions in a block explorer.
Ether (ETH) and gas fees
Ether is Ethereum's native coin. Every transaction or contract call costs a fee called gas, and it is paid in ETH, so you need some ETH even to send USDT on Ethereum.
The amount depends on how complex the operation is and how busy the network is, so it changes over time. The network fee guide covers this in more depth.
ERC-20 tokens and EVM chains
ERC-20 is the standard for tokens on Ethereum. USDT on Ethereum and many other tokens follow it.
Other chains copy Ethereum's technology and are called EVM chains, such as BNB Smart Chain, Polygon, Arbitrum, Optimism, Base and Avalanche. Their addresses look like Ethereum's, but each network holds separate balances.
Layer-2 networks and staking
A layer-2 network is built on top of Ethereum to make transactions faster and cheaper, then settles the results on Ethereum. Arbitrum, Optimism and Base are examples.
In September 2022 Ethereum moved from proof of work to proof of stake in an event called The Merge. People now lock up (stake) ETH to help validate transactions and earn rewards instead of mining. Staking has risks, and part of your funds may be locked.
What is Ethereum used for?
Ethereum is the base for many financial and digital applications. Well-known uses include:
- Tokens: creating digital assets such as stablecoins
- Decentralized exchanges: swapping assets without a central middleman
- Lending and borrowing through smart contracts
- Unique digital assets (NFTs)
- Escrow systems that hold funds until a condition is confirmed
Ethereum in Waletifi
Waletifi supports Ethereum and other EVM chains: BNB Smart Chain, Polygon, Arbitrum, Optimism, Base and Avalanche. One address works across these networks, but always pick the right network when sending.
The fee is shown before you confirm and the transaction is signed on your phone. This is not investment advice.
