Ethereum is a decentralized, open-source blockchain platform that was launched in 2015 by Vitalik Buterin and a team of developers. It is designed to enable the creation and execution of smart contracts, which are self-executing contracts with the terms of the agreement directly written into code.

Unlike Bitcoin, which primarily serves as a digital currency, Ethereum is a programmable blockchain that allows developers to build decentralized applications (dApps) on top of its platform. These applications can range from decentralized finance (DeFi) protocols, gaming platforms, decentralized exchanges, supply chain management systems, and much more.

One of the key features of Ethereum is its native cryptocurrency called Ether (ETH). Ether is used to power the network and incentivize participants to perform computations and validate transactions on the blockchain. It is also used as a medium of exchange for value transfer within the Ethereum ecosystem.

Ethereum introduced a major upgrade known as Ethereum 2.0, or Eth2, which aims to address scalability and improve the network's performance. The upgrade involves transitioning from a proof-of-work (PoW) consensus mechanism to a proof-of-stake (PoS) mechanism. This transition will make the network more energy-efficient and allow it to process a significantly higher number of transactions.

Smart contracts are a fundamental aspect of Ethereum. They are self-executing agreements with the terms of the contract directly written into code. Smart contracts automatically execute when the predefined conditions are met. This feature enables decentralized applications to operate autonomously without the need for intermediaries or central authorities.

Ethereum has gained significant popularity and has a large developer community, making it one of the most widely used blockchain platforms for building decentralized applications. It has also served as a platform for the launch of numerous Initial Coin Offerings (ICOs) and token sales, allowing projects to raise funds by issuing their own tokens on the Ethereum blockchain.

It's important to note that while Ethereum has established itself as a leading blockchain platform, it faces challenges such as scalability, high transaction fees during periods of high network demand, and competition from other blockchain projects aiming to solve similar problems. However, its active development community and continuous upgrades aim to address these challenges and further enhance the platform's capabilities.