The short version: Ethereum is a type of blockchain technology. Ether (ETH) is the cryptocurrency that runs on it. People often use “Ethereum” to mean both, but technically Ethereum is the platform and Ether is the coin.
What makes Ethereum different from Bitcoin?
Ethereum allows developers to build applications on top of it using smart contracts. These are automated agreements that execute when certain conditions are met. Bitcoin is mainly just a currency. Ethereum is a whole ecosystem.
How do you get Ether?
You can buy it through a cryptocurrency exchange, receive it as payment, or (historically) mine it. Mining involved using powerful computers to verify transactions on the network in exchange for newly created coins, though Ethereum has moved away from this model.
How is it taxed in the UK?
Same as other crypto. If you sell Ether for more than you paid, you might owe Capital Gains Tax on the profit above your annual allowance. If you earn Ether through work or mining, HMRC treats it as income and you’ll pay Income Tax and National Insurance on its value.
You need to declare crypto gains and income on your Self Assessment tax return.
Got Ether and not sure what you owe? We can help you work out your tax position.
