ETH is a utility token on the Ethereum blockchain. The Ethereum network’s operation principle is similar to a decentralized computer’s mechanism. The network uses Turing completeness to handle complex calculations: developers can write and deploy smart contracts on the network. Ethereum automatically fulfills digital agreements when creating dApps on the network.
The Ethereum network was launched in 2015 and, by 2017, had become the dominant platform for launching initial coin offerings. The popularity came thanks to the growing number of decentralized blockchain applications. In 2021, ETH hit the all-time high of $4,865.57.
In 2022, Ethereum switched from Proof-of-Work to Proof-of-Stake to achieve consensus among its distributed network of nodes. An Ethereum 2.0 update is also in the works, moving the network to a less resource-intensive consensus mechanism called proof of stake.
The selection of participants for processing and confirming transactions and calculations occurs randomly. Stakers get rewards in ETH for validating correctly and lose their stake in case of any attempt to manipulate the network.