Ethereum (ETH)

Ethereum (ETH) is the blockchain platform that took Bitcoin's idea of decentralised money a step further: instead of only transferring value, Ethereum runs programs — smart contracts — directly on the blockchain. Launched in 2015, it underpins most of decentralised finance (DeFi), stablecoins and NFTs.

For Australian investors, ETH is typically the second asset they encounter after Bitcoin. Its price in AUD reflects both investment demand and real usage: every transaction or application on the network pays fees in ETH.

Ethereum is a decentralised, open-source blockchain whose core feature is programmability. Developers write smart contracts — self-executing code that runs exactly as written — in languages like Solidity, and deploy them to the network. These contracts power lending markets, decentralised exchanges, games, digital collectibles and much more.

Ether (ETH) is the network's native asset. It is used to pay transaction fees (known as gas), to secure the network through staking, and as the base trading pair across much of the crypto economy.

Ethereum originally used Proof of Work mining like Bitcoin, but in September 2022 it completed “The Merge”, switching to Proof of Stake. Instead of miners, validators now lock up (stake) ETH for the right to propose and confirm blocks; validators who act dishonestly can lose part of their stake.

Blocks are produced every ~12 seconds. Transactions pay a gas fee in ETH, part of which is burned (permanently destroyed) under the EIP-1559 upgrade, introducing a mechanism that can reduce net supply when network usage is high. High throughput demand is increasingly handled by Layer-2 networks (such as Arbitrum, Optimism and Base) that settle back to Ethereum.

Ethereum was described in a 2013 whitepaper by Vitalik Buterin, then a 19-year-old programmer, and developed by a founding team that included Gavin Wood and others. The network launched on 30 July 2015.

Key milestones include the 2016 DAO hack and the subsequent chain split (creating Ethereum Classic), the 2017 ICO boom, the 2020–21 DeFi and NFT waves, The Merge in September 2022, and US spot Ether ETF approvals in 2024.

Unlike Bitcoin, ETH has no fixed supply cap. Issuance is set by protocol rules and changes with network upgrades: new ETH is issued to staking validators, while a portion of every transaction fee is burned. When network activity is high, the burn can exceed issuance, making ETH temporarily deflationary.

Circulating supply and market capitalisation are shown in the live pricing data on this page.

Australians can buy ETH on AUSTRAC-registered exchanges including Swyftx, CoinSpot and Independent Reserve, typically with free or low-cost AUD deposits via PayID or bank transfer. Identity verification (KYC) is required.

The ATO treats ETH as a CGT asset: selling, trading or spending it (including swapping ETH for another token) can trigger a capital gain or loss. Staking rewards are generally treated as ordinary income when received. Keep records of every transaction.

ETH is volatile and can fall significantly in short periods. Additional risks include smart-contract bugs in the applications built on Ethereum, competition from other smart-contract chains, changing fees and congestion, and evolving regulation of staking services and DeFi.

Holding ETH itself does not protect you from losses in individual DeFi protocols or NFTs. Never invest more than you can afford to lose.