Ethereum is the world's second-largest blockchain and allows the storage and transfer of data through the use of so-called smart contracts. Smart contracts are digital agreements with predefined conditions and rules used between two or more parties, eliminating the need for a third party to be involved. More comprehensive smart contracts are commonly referred to as decentralized applications (dApps). This means that Ethereum is used for more than just payments. Simply put, Ethereum can be described as an internet-based marketplace for financial services, dApps, and more.
Ether (ETH) is the second-largest cryptocurrency after Bitcoin. Like Bitcoin, Ether is a decentralized cryptocurrency that operates without any control from third parties. Similar to Bitcoin, all transactions are available in a public ledger to ensure transparent access to transactions. Ether was created to be used as a payment method on the Ethereum blockchain, enabling participants to use the applications available on the blockchain. Unlike Bitcoin, the amount of Ether is not capped and can therefore vary.
Both Ether and Bitcoin are global, digital, and decentralized cryptocurrencies that use blockchain technology, but the reasons for their creation differ. While the primary purpose of Bitcoin was to introduce a new digital monetary system, the main purpose of Ether was to create a payment method to facilitate operations within the Ethereum network.
What decides the value of ether?
Just like other cryptocurrencies, the price of Ether is determined by supply and demand. In other words, the price at which users are willing to buy and sell determines its value. As DeFi applications (decentralized finance) and NFTs (non-fungible tokens) become more popular, new participants see the value in Ether. As more users choose to be part of the Ethereum network, volatility gradually decreases, and the asset's price stabilizes.
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Ethereum's website: https://ethereum.org/en/
Ethereum's white paper: https://ethereum.org/en/whitepaper/
Ethereum on Wikipedia: https://en.wikipedia.org/wiki/Ethereum