Ether (ETH)

Ether (ETH) is the native cryptocurrency of the Ethereum blockchain and has many of the same features as bitcoin (e.g., ether is public, peer-to-peer, decentralized, censorship resistant, etc.). One distinction, however, is the method in which miners are incentivized. Instead of block rewards and transaction fees (in Bitcoin), Ethereum uses gas, which is a measure of computational power needed to complete a transaction. For larger transactions that take more power, an Ethereum user will have to pay more gas to miners and vice versa.

For block size, Ethereum blocks are capped by the amount of gas each of them can store up. Ethereum is limited by 6.7 million gas limits on each block. The miners can only add transactions whose gas requirements add up to something which is equal to or less than the gas limit of the block. A typical one-on-one transaction eats up 21,000 units of gas.

Currently, ether is the second largest cryptocurrency by market cap, second to Bitcoin. However, unlike bitcoin, which has a hard cap of 21 million bitcoins, ether does not (yet) have a hard cap limit.

In September 2022, the then-current Ethereum Mainnet merged with the Beacon Chain proof-of-stake system. This marked the end of proof-of-work for Ethereum, and the full transition to proof-of-stake set the stage for future scaling upgrades including sharding. The Merge also reduced Ethereum’s energy consumption by ~99.95% More: https://ethereum.org/en/upgrades/merge/

Note: These are non-technical definitions meant for a general audience and should not be used as legal definition
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