Ethereum is the second‑largest blockchain after Bitcoin, but it does more than just store value.

What Happened

Launched in 2015 by Vitalik Buterin, Ethereum introduced the concept of programmable money through smart contracts—self‑executing agreements that run on the network. The platform also hosts thousands of decentralized applications (dApps) that run on its native token, Ether (ETH).

Why It Matters for Bitcoin

While Bitcoin focuses on secure, immutable value transfer, Ethereum expands the ecosystem by enabling developers to create on‑chain logic. Many Bitcoin users interact with Ethereum through cross‑chain bridges, liquidity pools, and wrapped tokens, making ETH a complementary asset in the broader crypto economy.

Market Impact

Recent market sentiment, reflected in a Fear & Greed Index of 16 (Extreme Fear), has pressured ETH prices. However, institutional interest in Ethereum 2.0 upgrades and DeFi growth continue to support long‑term demand.

What to Watch Next

  • Ethereum’s shift to a proof‑of‑stake consensus with the London hard fork.
  • Upcoming roll‑ups and layer‑2 scaling solutions.
  • Regulatory developments around tokenized assets and DeFi.

Start Here

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Source

Original guide by Decrypt: What is Ethereum? Quickly Explained – Four Minute Guide.