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How the Ethereum Virtual Machine (EVM) works

The Ethereum Virtual Machine (EVM) is a crucial component of the Ethereum blockchain, responsible for executing smart contracts and processing transactions. Here’s a detailed overview of how the EVM works:

1. What is EVM?

2. Execution Process

  1. Bytecode Execution:

    • Smart Contracts: Smart contracts on Ethereum are written in high-level languages like Solidity.
    • Compilation: Smart contract code is compiled into bytecode, which is a low-level representation understandable by the EVM.
  2. Transaction Processing:

    • Transaction Initiation: Users initiate transactions by sending them to the Ethereum network.
    • Transaction Receipt: Miners and nodes validate transactions and include them in blocks.
  3. Smart Contract Invocation:

    • Call Data: Transactions or contract interactions include call data, specifying the function to execute and any parameters.
    • Execution Environment: Each transaction or contract call creates a new instance of the EVM to execute the bytecode.
  4. Gas and Fee Mechanism:

    • Gas Limit: Each transaction specifies a gas limit, which is the maximum amount of computational work (instructions) the EVM can execute.
    • Gas Price: Users specify a gas price, representing the fee paid to miners for executing the transaction.

3. Components of EVM

  1. Stack-based Machine:

    • EVM operates as a stack machine, where operations and data manipulation occur through a stack of items (values or instructions).
    • It supports basic operations such as arithmetic, bitwise operations, stack manipulation, and cryptographic functions.
  2. Memory and Storage:

    • Memory: EVM provides a volatile memory area for temporary data storage during contract execution.
    • Storage: Persistent storage on the blockchain where contract state variables are stored permanently.
  3. Gas Management:

    • Gas Cost: Each operation in the EVM has an associated gas cost, reflecting computational complexity and resource usage.
    • Gas Refund: Unused gas is refunded to the sender after execution, incentivizing efficient contract design and execution.

4. Decentralized Consensus

  1. Consensus Mechanism:

    • EVM execution and transaction validation occur across a decentralized network of nodes.
    • Nodes independently execute transactions and reach consensus on the validity of blocks.
  2. Deterministic Execution:

    • EVM execution is deterministic, meaning the same inputs and code produce the same outputs.
    • This property ensures consistency and predictability across all nodes executing the same transactions.

5. Example Workflow

  1. Transaction Initiation:

    • User A sends ETH to User B using a dApp interface (e.g., MetaMask).
  2. Transaction Propagation:

    • The transaction propagates across the Ethereum network, reaching miners for inclusion in a block.
  3. Block Mining:

    • Miners compete to solve a Proof of Work puzzle to validate and add a new block to the blockchain.
    • The block includes the transaction and state changes resulting from smart contract executions.
  4. Block Finalization:

    • Once added, the block is final and forms part of the immutable Ethereum blockchain.
    • Smart contract state changes are reflected permanently in the blockchain's state trie.
Published on: Jul 08, 2024, 11:53 PM  
 

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