What is the difference between Ethereum and ether?

Ethereum vs ether comes down to network versus money. Ethereum is the blockchain network that runs smart contracts and decentralized apps, and ether (ETH) is the cryptocurrency built into it. The two words are mixed up all the time, which is why ethereum.org notes that people talking about the price of Ethereum usually mean the price of ether.

What is ether?

Ether is the native currency of the Ethereum network. Its main job is paying gas fees, the charges for having the network process a transaction or run a program. It is also staked by validators to secure the network, used as collateral in lending apps and used as a unit of account on NFT marketplaces. You can read more about the network itself in what is Ethereum.

New ether is created only by the protocol, as rewards for validators who propose blocks and help reach agreement. Users cannot mint it themselves. At the same time, the base fee in every transaction is burned, which takes ether out of circulation. Unlike bitcoin, ETH has no fixed supply cap, so total supply can rise or fall depending on how busy the network is.

Is ETH the same as Ethereum?

ETH is the ticker symbol for ether, not for the network. When an exchange lists "Ethereum (ETH)", what you are buying is ether. The network is the system the coin lives on, in the same way an app store is different from the money you spend in it.

Ether also comes in smaller units. The smallest is the wei, equal to 10^-18 ETH, and the gwei, a billion wei, is commonly used to quote gas fees. See what is gwei for how that works in practice. Native ETH is also not an ERC-20 token. Apps that need an ERC-20 version use wrapped ether (WETH), which represents ETH one to one.

Where does the name Ethereum come from?

Vitalik Buterin described Ethereum in a white paper in November 2013, and the blockchain went live in 2015 with several co-founders. Buterin named the network Ethereum and its currency ether. According to Dictionary.com, the name draws on the older word "ether", a substance once believed to permeate all space. The idea fits a network meant to sit underneath many different applications. The full founding story is in who created Ethereum.

Why does the difference matter?

Most of the time, mixing the words causes no harm. It matters when you are reading technical material or upgrade news. A network upgrade changes Ethereum, the software and its rules, but it does not change the ether in your wallet. For the Fusaka upgrade, ethereum.org said holders needed to take no action and warned that anyone telling you to "upgrade" your ETH is trying to scam you. Knowing which word refers to what makes that kind of trick easier to spot.