What is Ethereum?

Ethereum is the blockchain that made smart contracts mainstream: a shared computer where programs hold balances and enforce rules, and where most of DeFi, NFTs and stablecoin activity first took shape. Its native asset, ether, pays for computation and, since the move to proof of stake, secures the network through staking. Transactions are batched into blocks roughly every twelve seconds.

An Ethereum address is a single identity across a family of chains. The same 0x address works on Arbitrum, Base, Optimism, Polygon and every other EVM-compatible network, which is convenient and confusing at once: one address can hold different balances on twenty chains, and a view of one chain is not a view of the wallet.

Fees, called gas, are the cost of using the shared computer. They rise when the network is busy and fall when it is not, and the layer-2 networks exist largely to make the same activity cheaper by settling batches of transactions back to Ethereum. Bridges move assets between the base chain and its layers, which is where much accounting confusion begins.

Tracking an Ethereum wallet properly means reading the address on every EVM chain it touches, decoding DeFi positions on each, and treating a bridge as a transfer rather than a sale. TrueHold reads one 0x address across the EVM chains it supports and totals the result, so a balance on Base is not missed because you only ever looked at mainnet.

Ether itself is also a productive asset. Since the switch to proof of stake, holders can stake ETH directly or through liquid staking tokens such as stETH, earning rewards that accrue in the token balance rather than arriving as separate payments. A tracker has to recognise those receipts as ETH exposure with yield, not as a different coin, or the portfolio's ETH allocation reads too low.