What is Ethereum? Ethereum is a decentralized, open-source blockchain pla orm introduced in 2015 by Vitalik Buterin. Unlike Bitcoin, which primarily focuses on peer-to-peer digital payments, Ethereum enables developers to create and deploy smart contracts and decentralized applica ons (dApps) on its blockchain. Key Features: 1. Smart Contracts: Self-execu ng contracts with predefined rules coded into the blockchain. 2. Ethereum Virtual Machine (EVM): Executes smart contracts and dApp code. 3. Na ve Cryptocurrency: Ether (ETH) is used for transac on fees and incen vizing network par cipa on.
Introduc on to Ethereum Ethereum builds on blockchain principles, but its focus extends beyond financial transac ons to programmable logic. It provides a pla orm for: 1. Building dApps: Applica ons that run without central servers. 2. Execu ng Smart Contracts: Automa ng agreements without intermediaries. 3. Token Standards: Suppor ng token ecosystems like ERC-20 (fungible tokens) and ERC-721 (non- fungible tokens or NFTs).
Consensus Mechanisms in Ethereum
Ethereum transi oned from Proof of Work (PoW) to Proof of Stake (PoS) with the Ethereum 2.0 upgrade in 2022, improving energy efficiency and scalability. 1. Proof of Work (PoW) (Before Ethereum 2.0): Miners competed to solve cryptographic puzzles. Energy-intensive and limited scalability. 2. Proof of Stake (PoS) (Ethereum 2.0 and Beyond): Validators lock (stake) Ether as collateral to propose and validate blocks. Energy-efficient and faster than PoW.
How Smart Contracts Work
A smart contract is a program stored on the blockchain that executes when specific condi ons are met. Key Steps: 1. A developer writes the contract code (e.g., in Solidity). 2. The contract is deployed to the Ethereum blockchain. 3. Once deployed, it becomes immutable and executes automa cally when invoked.
Use Cases: 1. DeFi (Decentralized Finance): Automated lending, borrowing, and trading. 2. Tokeniza on: Issuing tokens for fundraising or assets. 3. Supply Chain: Automa ng and tracking logis cs.
Metamask Setup MetaMask is a popular cryptocurrency wallet and browser extension that allows users to interact with Ethereum and dApps. Setup Steps: 1. Download MetaMask (browser extension or mobile app). 2. Create a wallet by genera ng a 12-word recovery phrase.
3. Secure the phrase offline.
4. Add ETH to the wallet via exchanges or direct transfers.
Ethereum Accounts Ethereum accounts represent a user's iden ty on the blockchain. 1. Externally Owned Accounts (EOAs): o Controlled by private keys. o Used for sending/receiving Ether and interac ng with contracts. 2. Contract Accounts: o Represent deployed smart contracts.
o Controlled by their code and cannot ini ate transac ons.
Receiving Ether (ETH)
1. Share your public key (address) with the sender. 2. Once Ether is sent, it is added to your account a er confirma on by the network.
What is a Transac on?
An Ethereum transac on is an ac on signed by an EOA and submi ed to the blockchain. Components: 1. Sender Address: Ini ator's account. 2. Receiver Address: Recipient's account or contract. 3. Gas Fee: Fee paid for computa onal resources.
4. Data: Op onal input data for contract interac on.
5. Signature: Verifies the transac on’s authen city.
Smart Contracts in Ethereum
Smart contracts form the backbone of Ethereum, automa ng agreements and enabling trustless opera ons. Advantages: 1. Transparency: Code is publicly visible. 2. Immutability: Cannot be altered once deployed. 3. Cost-Effec ve: Removes intermediaries. Challenges: 1. Bugs: Errors in code can lead to vulnerabili es. 2. Irreversibility: Mistakes or malicious interac ons cannot be undone.
Merkle Patricia Tree
A Merkle Patricia Tree is a modified version of the Merkle Tree used in Ethereum to: 1. Efficiently store and verify key-value data (e.g., account balances). 2. Provide a compact and secure structure for the Ethereum state (accounts, storage, and transac ons). How It Works: 1. Combines Merkle Trees (hash-based structure) with a Patricia Trie (prefix-based tree). 2. Stores: o Account balances. o Smart contract code. o Contract storage. Benefits: 1. Compact storage of blockchain data. 2. Efficient verifica on and synchroniza on for nodes.
