Understanding Ethereum
EthereumXYZ provides clear, concise notes on how the Ethereum network works, what its ecosystem contains, and where to learn more. It is maintained by independent community members; for anything critical, consult the official developer documentation.
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Network
How the chain actually runs: execution and consensus layers, clients, gas and fees, accounts, staking mechanics.
History
Ethereum from the 2013 whitepaper to today: every major upgrade and turning point, in order.
Ecosystem
DeFi, layer 2 networks, token standards, staking services and developer tooling, mapped and explained.
Data
Network parameters, supply and staking figures, fee examples, energy use, and historical market notes.
Learn
Fifteen frequent questions, answered plainly, plus a glossary of the terms worth knowing.
Resources
A curated library of official documentation, data sources, tools and community forums.
The network at a glance
Approximate figures as of October 2026; see the data page for detail and sources.
What is Ethereum?
Ethereum is a public, open-source blockchain built to run arbitrary programs rather than only process payments. Short programs deployed on it, known as smart contracts, execute exactly as written, without a central operator able to intervene. The idea was proposed by Vitalik Buterin in late 2013, and the network went live in July 2015.
Its native asset, ETH, has three primary functions: it pays transaction fees (small amounts of ETH are burned with every transaction under the fee mechanism introduced in 2021), it is staked by validators to secure the network, and it serves as the ecosystem's most common unit of account and collateral.
Since September 2022 Ethereum has been secured by proof-of-stake rather than proof-of-work, which cut the network's energy use by an estimated 99.9% or more. Development continues along a public roadmap, with recent upgrades focused on making layer-2 activity cheaper and long-run scaling more tractable. The network page covers how it all works in detail.
The ecosystem
Six areas that account for most ecosystem activity; the ecosystem page goes deeper.
Decentralized finance
Protocols for lending, trading and minting assets without intermediaries, composed from open smart contracts. Widely used examples include the trading protocol Uniswap and the lending market Aave.
Tokens & NFTs
Interoperable token standards, including ERC-20 for fungible tokens and ERC-721 and ERC-1155 for unique items, let anyone issue assets that every wallet and exchange in the ecosystem can understand without custom integration.
Layer-2 rollups
Networks such as Arbitrum, Optimism and Base execute transactions off the main chain and post compressed data back to it, inheriting much of its security at a fraction of the cost.
Smart contracts & languages
Contracts run on the Ethereum Virtual Machine and are mostly written in Solidity or Vyper. Once deployed they are public, immutable unless designed otherwise, and interact with each other like APIs.
Staking
Validators lock 32 ETH each to propose and attest blocks, earning rewards for honest work. Since the 2023 Shapella upgrade, stake can also be withdrawn. Pooled staking and liquid staking tokens let people participate with less than 32 ETH, with different risk trade-offs.
Milestones
Condensed; the history page tells the full story.
- 2013The whitepaper proposes general-purpose computation on a blockchain, not just payments.
- 2015Frontier, the first live release (July 30).
- 2016Homestead hardens the protocol; the DAO exploit leads to a contested hard fork, after which Ethereum Classic continues the unforked chain.
- 2017Byzantium brings the first Metropolis upgrade package.
- 2019Constantinople rounds out Metropolis with cheaper opcodes and prep for proof-of-stake.
- 2020The beacon chain launches in December: proof-of-stake goes live, initially in parallel with proof-of-work.
- 2021The London upgrade introduces EIP-1559: predictable base fees that are burned.
- 2022The Merge (Sept 15) retires proof-of-work; energy use drops by an estimated 99.9% or more.
- 2023Shapella enables staking withdrawals.
- 2024Dencun introduces blob data (proto-danksharding), sharply cutting layer-2 costs.
- sinceFurther protocol upgrades have continued; see the official roadmap for the current picture.
Ethereum and Bitcoin, side by side
A simplified comparison for orientation; both projects continue to evolve.
| Ethereum | Bitcoin | |
|---|---|---|
| Consensus | Proof-of-stake since 2022 | Proof-of-work |
| Programmability | Turing-complete contracts on the EVM | Deliberately limited scripting |
| Block interval | ~12 seconds | ~10 minutes |
| Smart contracts | Core to the design | Minimal; richer behavior is implemented in adjacent protocols |
| Finance ecosystem | Large native DeFi sector | Smaller; focused on the asset itself |
| Energy use | Low since the Merge | High; inherent to proof-of-work |
| Supply | Dynamic: issued to stakers, base fees burned | Hard cap of 21M coins |
Common questions
Three of the most frequent; the learn page answers fifteen, plus a glossary.
- What is Ethereum?
- A public blockchain for running smart contracts: programs that execute and enforce themselves, used most visibly for digital assets and financial protocols.
- What was the Merge?
- The September 2022 switch from proof-of-work mining to proof-of-stake validation. It removed mining, cut energy use by an estimated 99.9% or more, and set up today's staking economics.
- What are layer-2 solutions?
- Separate networks that bundle transactions and anchor them to Ethereum for security. They charge much lower fees while keeping a strong link back to the main chain.
About this site
EthereumXYZ is a community-maintained guide to the Ethereum ecosystem, published at ethereum.xyz and run independently of the Ethereum Foundation. The site is provided for educational and informational purposes only, on a non-commercial basis.
Corrections and questions: [email protected].