ETH utility describes the practical applications and functions of Ether, the native cryptocurrency of the Ethereum blockchain. Beyond its role as a store of value, ETH is primarily used to pay for transaction fees (gas), secure the network through staking in the Proof-of-Stake consensus mechanism, and serve as collateral or a medium of exchange within decentralized applications. Its utility is fundamental to the operation of the Ethereum ecosystem. The diverse applications drive its value.
Context
The discussion surrounding ETH utility is central to its long-term value proposition and the growth of the Ethereum network. The transition to Proof-of-Stake (the Merge) significantly enhanced ETH’s utility by enabling staking rewards and introducing a burning mechanism for transaction fees. A critical future development involves the continued expansion of the Ethereum ecosystem, particularly with layer-2 solutions, which further broaden ETH’s use cases and solidify its position as a foundational digital asset for decentralized computing.
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