What is Ethereum, and how does it work?

Ethereum is a decentralized blockchain that enables secure, peer-to-peer execution and verification of smart contracts, allowing applications to run without intermediaries. Its native cryptocurrency, ether (ETH), is the second most valuable cryptocurrency by market cap.

Unlike Bitcoin's capped supply, ether has an uncapped supply that fluctuates based on staking demand and transaction burns. Ethereum uses a Proof-of-Stake consensus mechanism, which is more energy-efficient than Bitcoin's Proof-of-Work, as validators are incentivized through collateralized stakes.

The blockchain supports diverse applications, including Decentralized Finance (DeFi), non-fungible tokens (NFTs), and stablecoins, enabling fast transactions and fostering a wide range of financial and creative opportunities. Its robust network of thousands of nodes ensures security and decentralization, making Ethereum a key player in the blockchain ecosystem.