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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.
Staking in Ethereum 2.0 is a process where users lock up their ETH as collateral to become validators. Validators are responsible for verifying and proposing new blocks in the network, earning rewards in return. This replaces mining in the PoS model, making Ethereum more energy-efficient.
In the PoW model, miners verify Ethereum transactions by solving mathematical puzzles. In the PoS model, validators verify transactions by staking ETH and participating in a consensus mechanism. Both methods ensure network security and transaction authenticity.
A zk-rollup (zero-knowledge rollup) is a Layer 2 scaling solution that bundles multiple transactions into a single batch, reducing on-chain data. It uses zero-knowledge proofs to validate transactions, making it secure and efficient for Ethereum.
Sharding is a method of splitting the Ethereum network into multiple “shards” or smaller chains. Each shard processes its own transactions, which reduces the load on the main chain, enabling the network to scale and handle more transactions per second.
Layer 2 solutions are scaling techniques built on top of the Ethereum main chain. They help reduce congestion and lower transaction fees by processing transactions off-chain or in separate chains, later settling results on Ethereum. Examples include Optimism, Arbitrum, and zk-rollups.