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Ethereum is a blockchain platform designed to build decentralized applications (dApps) using smart contracts. Ether (ETH), its native cryptocurrency, is the second largest crypto by market cap. It’s used to pay for transaction fees (gas), run dApps, and execute smart contracts. Ether also plays a key role in decentralized finance (DeFi), staking, NFTs, and decentralized exchanges.
Ether (ETH) is used to pay transaction fees, known as “gas,” on the Ethereum network. It incentivizes miners to process and verify transactions and is also used as currency within various dApps on the network, facilitating DeFi transactions, NFT purchases, and more.
Gas fees vary based on network demand. When many users want to transact or interact with dApps simultaneously, fees rise as users compete to have their transactions processed quickly. During quieter times, gas fees tend to be lower.
Ethereum 2.0, also known as “Eth2” or “Serenity,” is an upgrade to the Ethereum blockchain aiming to increase scalability, security, and sustainability. The upgrade includes moving from PoW to PoS, which replaces miners with validators, significantly reducing energy consumption.
Gas is the fee required to conduct transactions or execute contracts on Ethereum. Measured in small units of ETH called “gwei,” gas fees are paid to miners to incentivize them to validate and process transactions.
Ethereum mining initially relied on a proof-of-work (PoW) system, where miners used computational power to solve complex puzzles and validate transactions. However, with Ethereum 2.0, the network is transitioning to a proof-of-stake (PoS) consensus model.