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The asset ether is native to and dependent on the accompanying value transfer system of Ethereum the protocol and Ethereum the network. All participants in the Ethereum network share a common rule set, the Ethereum protocol, enabling each participant to keep track and effectively ensure the correct transfer of ether, the asset.
Each unit is fully digital and is only held and transferred through uniquely created digital wallets. The process of creating a wallet, storing and moving ether doesn’t require any involvement from any other individual, group, or entity other than the individual user. As a fully internal unit, ether can be transacted without counterparty risk, meaning it doesn’t depend on anything external to itself (credit or otherwise). It is also a digital bearer asset in that whoever controls the respective private keys controls the ether.
Ether is also used to pay for gas fees, which are required for executing transactions and smart contracts on the Ethereum network. Additionally, validators stake ether in the proof-of-stake consensus mechanism, providing economic security and ensuring the proper functioning of the network.