Understanding the Ethereum Blockchain and Balances
As a user of the Ethereum network, it’s natural to wonder how your current balance is determined. You’re right that it seems intuitive to simply send a transaction with the amount you want to move. But behind the scenes, the Ethereum blockchain plays a crucial role in keeping track of your balance.
Basics: Transactions and Blocks
In simple terms, transactions are like digital messages sent between nodes on the Ethereum network. When you send a transaction, you’re sending a set of instructions (called a “transaction”) with the amount of Ether (ETH) or another token you want to transfer to someone else. The blockchain is a public ledger that keeps track of all transactions made on the network.
A block is a collection of transactions, and each block has a unique code, called a “hash,” that connects it to the previous block. This hash serves as a link between blocks, forming a chain.
The Ethereum Virtual Machine (EVM) and Accounts
At the heart of the Ethereum blockchain is the Ethereum Virtual Machine (EVM). The EVM is a software framework that runs smart contracts on the network. It defines how transactions are verified, validated, and stored on the blockchain.
Each user account on the Ethereum network is represented by a unique address, which is essentially a public key tied to a specific balance. This address is used to store and manage your Ether or other tokens.
How Balances Are Stored
When you create an account or deposit Ether into it, your balance is stored in the EVM memory pool. The memory pool is a data structure that keeps track of all balances on the network.
Here’s how it works:
- When you create an account or deposit Ether, the transaction is verified and validated by the Ethereum network.
- Once verified, the transaction is tied to a specific block hash and included in the blockchain.
- The EVM updates its memory pool balance based on transactions that have occurred since its last update.
The Block Hash: A Link Between Blocks
As mentioned above, each block has a unique hash code that connects it to the previous block. This hash serves as a link between blocks and forms the basis of the Ethereum blockchain architecture.
When you send a transaction, the EVM uses this hash to determine where on the blockchain your funds are transferred. The hash is used to validate the sender-receiver relationship and ensure the transaction is valid before including it in the next block.
In simple terms: your balance is stored
In short, when you create an account or deposit Ether into it, your balance is stored in the EVM memory pool. This pool is updated based on transactions that have occurred since its last update, using a unique hash code to link each transaction to its corresponding block.
When you send a transaction, the EVM uses this hash code to determine where on the blockchain your funds are transferred, ensuring your balance is accurately reflected.
In Conclusion
Ethereum’s blockchain architecture plays a crucial role in keeping track of balances. By understanding how transactions work and how your account is represented by a unique address, you now have a better understanding of how the Ethereum network knows your current balance.