What is Ethereum? Simple Guide for Beginners - Smart Contracts & DeFi Explained (2025 Update)

Ethereum is a decentralized blockchain platform that goes beyond digital currency, enabling smart contracts and powering the DeFi (Decentralized Finance) ecosystem. Launched in 2015, it uses Ether (ETH) as its native cryptocurrency to fuel transactions and apps. Smart contracts are self-executing agreements that run automatically, driving innovation in finance, gaming, and more. In 2025, Ethereum’s eco-friendly Proof-of-Stake system, recent upgrades like Pectra, and booming DeFi activity—handling over 90% of DeFi’s value—make it a cornerstone of Web3. This beginner-friendly guide explains Ethereum’s basics, its role in smart contracts, and why it’s leading the DeFi revolution.

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