"Ether" is a form of cryptocurrency, which means that it is "decentralized", and also means that people can use it for payments without revealing who they are. Instead, people can use the Ethereum system by "addresses" (also called "keys") which they can keep secret from others. The Ether coin can be transferred between accounts and used as a payment mechanism. The Ether coin is mined and used as compensation to miners for verifying transactions.