About Ethereum (ETH)
Ethereum (ETH) is a decentralised, open-source blockchain network launched in 2015 that was a pioneer of smart contract functionality. As the world's second-largest cryptocurrency by market capitalisation, it helped transform the basic functions of a digital currency into a versatile global computing ecosystem. It acts as the foundational layer for a new digital realm, enabling developers to build and deploy decentralised applications (dApps) without a central authority.
The native cryptocurrency, Ether, is used to pay for network fees and reward users participating in the Proof of Stake consensus mechanism. Individuals can purchase Ethereum using fiat through PayID transfers on AUSTRAC-registered platforms like Swyftx.
Why investors may choose Ethereum
Ethereum offers utility beyond being a store of value. It allows individuals to invest in the underlying technology that powers decentralised exchanges, lending protocols, and digital identity platforms. For those looking to navigate market volatility, automated features like Auto Invest facilitate dollar-cost averaging, enabling consistent, long-term accumulation.
Ethereum vs Bitcoin
Differentiating between the two largest digital assets requires looking at their underlying utility. Ethereum is a programmable network built specifically to execute smart contracts and support decentralised applications. Conversely, comparing it to Bitcoin highlights BTC’s primary design as a secure, decentralised store of value with a fixed supply.
Feature | Ethereum (ETH) | Bitcoin (BTC) |
|---|---|---|
Primary Purpose | Smart contracts & applications | Store of value |
Supply Model | Variable (with burn mechanisms) | Fixed (21 million) |
Use Case | DeFi, NFTs, Web3 infrastructure | Wealth preservation |
What drives Ethereum's price?
Ethereum's market valuation can be driven by network usage, protocol upgrades, and broader macroeconomic factors.
Network adoption
As participation increases across decentralised applications and Layer 2 scaling solutions, the demand for ETH to pay transaction fees directly impacts its open market liquidity. Ethereum remains a foundational player in decentralised finance (DeFi) and has paved the way for alternative smart contract platforms like Cardano, Solana, and Avalanche.
Furthermore, institutional demand significantly influences valuation; following the US SEC's approval of spot Ether ETFs in May 2024, these funds exceeded a combined market cap of US $10 billion within a year, providing regulated exposure to traditional stock exchange investors.
Supply mechanics
Ethereum does not have a fixed maximum supply. However, it employs a fee-burn mechanism that permanently removes a portion of ETH from circulation during periods of high network activity, which can introduce deflationary pressure.
Market sentiment
As a globally traded asset, ETH remains highly sensitive to macroeconomic indicators, regulatory developments regarding digital assets, and institutional capital inflows.
How to store Ethereum
After purchasing ETH, investors must decide on a storage method. Assets can remain on a regulated custodial exchange or be withdrawn to a private hardware wallet or Web3 browser wallet for direct ownership. For more information on self-custody options, refer to our crypto wallet guide.
