Other coins can aim at different jobs. Start with the job, then ask how the network adds blocks and what evidence supports the project.
Where does Ethereum fit?
Ethereum (ETH) is a smart-contract platform. It moved from proof-of-work to proof-of-stake in September 2022, in the change known as the Merge.
Place Ethereum in the wider map rather than on the Bitcoin fork branch. The useful comparison here is what it is built to do and how its network agrees on blocks.
Who gets to add the next block?
Proof-of-work
Miners spend energy. Bitcoin uses this method. The question to carry forward: how does the network use that work to decide which blocks to accept?
Proof-of-stake
Validators lock up coins. Ethereum uses this method. The question to carry forward: how do the network's rules govern those validators?
These labels describe different ways of adding blocks. The label alone does not tell you whether a project has a working product.
Does “stable” mean the value cannot move?
No. A stablecoin is a token designed to track a reference, such as the US dollar. It can lose that peg. The issuer's reserves and redemption terms matter.
- What reference is the token designed to track?
- What evidence supports the issuer's reserve claims?
- What do the redemption terms actually allow?
- What happens if the token stops tracking its reference?
Is there a product beyond the token?
Many tokens have no working product. New coins are also a common vehicle for rug pulls and pump-and-dump schemes. Use questions that can lead to evidence, rather than relying on the token's name.
Show the thing that works.
Can you identify a working product, inspectable software or network records? A description of a future product leaves that question unanswered.
Connect each claim to a record.
Who makes the claim? Can you inspect the supporting material? Separate project wording from facts you can check.
Look past the ticker.
What would you learn about this project if its token had no name? If only promotional claims remain, the product question is still open.
Where can you check the sources?
This guide uses the project material and approved editorial facts supplied for this publication. External pages can change; follow the source and check its current wording.