Purpose of the token

The ethereum network provides a cryptocurrency token called “ether”, which can be transferred between accounts and used to compensate participant nodes for computations performed. “Gas”, an internal transaction pricing mechanism, is used to mitigate spam and allocate resources on the network.

The token is used to pay for the execution of "smart contracts" which are little programs run on the Ethereum network which most often are programs designed to execute a value transfer between two or more parties. Ether can also be used as a currency to pay one another.

Token uses & incentives for holders

The more the network will be used, the more people need to pay 'gas' to execute their smart contracts. This will increase the value of ether.