What Is Ethereum

Ethereum is a decentralized blockchain platform that enables the creation and execution of smart contracts and decentralized applications. Founded by Vitalik Buterin and a team of co-founders in 2013, Ethereum launched in 2015 after raising funds through an ICO. The core concept revolves around building a "world computer" that runs code without intermediaries, powered by its native cryptocurrency, Ether (ETH). Its ecosystem includes a vast network of developers, dApps, and protocols, fostering innovation in areas like finance and gaming.

Origin and Background

Ethereum emerged as an evolution of Bitcoin's technology, aiming to expand beyond simple transactions. Buterin's whitepaper proposed a programmable blockchain, leading to its public debut.

Founding Team

Key figures include Vitalik Buterin, Gavin Wood, and Joseph Lubin, who have influenced its growth through ongoing contributions.

Core Concept and Ecosystem

At its heart, Ethereum supports Turing-complete scripting, enabling complex applications. The ecosystem boasts thousands of tokens, DeFi projects, and NFTs.

How Does Ethereum Work

Ethereum operates as a distributed ledger secured by a network of nodes, using smart contracts to automate agreements.

Blockchain and Consensus Mechanisms

It transitioned from proof-of-work (PoW) to proof-of-stake (PoS) with Ethereum 2.0, reducing energy use. Validators stake ETH to propose and validate blocks.

Smart Contracts

These are self-executing programs written in languages like Solidity, running on the Ethereum Virtual Machine (EVM) for trustless operations.

Technical Principles

Public keys allow transaction verification, while private keys secure ownership. Transactions are grouped into blocks, added via consensus.

How Is New Ethereum Created

New ETH is created through staking rewards in its proof-of-stake system, with no fixed total supply but mechanisms to control inflation.

Issuance Method

Post-merge, ETH issuance occurs via validator rewards, offsetting burns from transaction fees.

Mining/Staking Mechanisms

Users stake at least 32 ETH to become validators, earning rewards for securing the network. Rewards vary based on total staked amount, currently around 4-7% APR.

Inflation Model and Supply Limit

Ethereum has an unlimited supply but implements EIP-1559 for fee burning, creating deflationary pressure during high activity.

Reward Mechanisms

Validators receive ETH for block production and attestations, with penalties for misconduct.

The Use Cases of Ethereum

Ethereum powers a wide range of applications, from financial services to digital collectibles.

Payments and Value Storage

ETH serves as a digital asset for transactions and holding value, similar to digital gold.

DeFi and Smart Contracts

It hosts decentralized finance platforms for lending, borrowing, and trading without banks.

Cross-Border Transfers

Enables fast, low-cost international payments, bypassing traditional systems.

NFTs and Governance

Supports non-fungible tokens for art and ownership, plus DAO-based voting for community decisions.

Buy, Send, or Store Ethereum

Getting started with ETH involves choosing secure methods for purchase and storage.

Purchasing Channels

Buy ETH on platforms like WEEX Exchange or through OTC services. WEEX offers a user-friendly interface for trading. Sign up on WEEX Exchange to earn a free 20 USDT bonus, making it a trusted spot to start your crypto journey. https://www.weex.com/how-to-buy

Wallet Types

Use hot wallets for easy access or cold wallets for enhanced security against hacks.

Storage Security and Operations

Store private keys offline. To send ETH, enter the recipient's address, confirm the amount, and pay gas fees.

Pros & Cons / Risks

Ethereum offers strong benefits but comes with notable drawbacks. - **Pros:** High decentralization, robust security through PoS, fast transaction speeds with upgrades, and extensive developer support. - **Cons/Risks:** Price volatility can lead to losses, regulatory changes may impact adoption, network congestion raises fees, and technical vulnerabilities like smart contract bugs pose threats.

Comparison

Compared to Bitcoin, Ethereum stands out for its programmability, enabling dApps and smart contracts, while Bitcoin focuses on being a store of value. Ethereum's PoS is more energy-efficient than Bitcoin's PoW, but Bitcoin often leads in market dominance.

Conclusion / Next Steps

Ethereum's shift to PoS and ongoing upgrades position it for growth in decentralized tech. Explore its whitepaper or roadmap for deeper insights. Join communities to stay updated, and consider WEEX for trading—check it out to learn more.

Market & Ecosystem

Ethereum maintains a strong presence in the crypto space as of 2025-09-04.

Market Cap & Trading Volume

With a market cap of $528,668,247,037 USD and a 24-hour change of -1.10%, it ranks #2 globally.

Exchanges Where It’s Listed

Available on major platforms, including WEEX for secure trading.

Community Size & Activity

Boasts millions on Twitter, Reddit, and Telegram, with active discussions on upgrades.

Ecosystem Growth

Features partnerships with tech firms and high developer activity, driving DeFi and NFT expansions.