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Ethereum Blockchain: Introduction and Architecture

Ethereum is a blockchain platform that allows developers to build decentralized applications and smart contracts. It was created in 2013 by Vitalik Buterin and launched in 2015. Ether is the cryptocurrency or token that fuels the Ethereum network. Users pay gas fees in ether for computational steps and data storage on the network. There are two types of accounts on Ethereum - externally owned accounts controlled by private keys, and contract accounts controlled by their code. Smart contracts are programs stored on the blockchain that run when triggered by transactions or messages. Decentralized apps (DApps) build upon Ethereum smart contracts and can have decentralized front-end, back-end, and data storage.

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161 views

Ethereum Blockchain: Introduction and Architecture

Ethereum is a blockchain platform that allows developers to build decentralized applications and smart contracts. It was created in 2013 by Vitalik Buterin and launched in 2015. Ether is the cryptocurrency or token that fuels the Ethereum network. Users pay gas fees in ether for computational steps and data storage on the network. There are two types of accounts on Ethereum - externally owned accounts controlled by private keys, and contract accounts controlled by their code. Smart contracts are programs stored on the blockchain that run when triggered by transactions or messages. Decentralized apps (DApps) build upon Ethereum smart contracts and can have decentralized front-end, back-end, and data storage.

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ABC XYZ
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© © All Rights Reserved
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Ethereum

Blockchain
Introduction and Architecture
Second Generation
of Blockchain
Ethereum - ETH
THE WORLD COMPUTER

Ashish Kumar (+91-9876061725)


• Ethereum was a • Ether is the first
college project by cryptocurrency to
19-year-old boy successfully
Vitalik Buterin in implement
2013 “Smart Contracts”

ETHEREUM
HISTORY • Today,
• Ethereum
Ethereum
raised 18.4
Blockchain hosts
million $ in ICO
more than 90% of
and the rest is
new tokens on its
history
platform

Ashish Kumar (+91-9876061725)


• Ethers are not capped like Bitcoin
however only a max of 18M ethers can be
created every year.

• Rate of issuance of ether is modelled to


approach zero, like bitcoin.
WHAT IS
ETHER • Intended to encourage move to PoS
system.

• Ether is not meant to be a store of value


but a means to pay fees within the
network.
Ashish Kumar (+91-9876061725)
• Ether is the main fuel and currency internal to Ethereum
platform.

• It is a form of payment made by the clients of the platform


to the machines executing their requested operations.
WHAT IS • Miners earn Ether as fees for executing and validating
transactions and as reward for mining a block.
ETHER
• Current Ether reward for mining a block is 2ETH (static
block reward) + miner’s tip.

• Over 100M ethers are currently in circulation with a


market cap of over $500 Billion.

Ashish Kumar (+91-9876061725)


● Every computation that occurs as a result of a
transaction on the Ethereum network incurs a
fee. This fee is paid in a denomination called ‘Gas’.

● Gas is the unit used to measure the fees


required for a computation
Transaction
Fees - GAS ● Gas price is the amount of Ether you are willing
to spend on every unit of Gas and is measured in
‘gwei’ ( 1 gwei = 10 power (-9) Eth).

● ‘Wei’ is the smallest unit of Ether, where 10¹⁸


Wei represents 1 Ether. One gwei is
1,000,000,000 (109) Wei.

Ashish Kumar (+91-9876061725)


GAS Limit
● With every transaction, a sender sets a Gas limit and Gas price.
● The product of gas price and gas limit represents the maximum
amount of Wei that the sender is willing to pay for executing a
transaction.
● 50,000 x 20 gwei = 1,000,000,000,000,000 Wei = 0.001 Ether

Gas Limit x Gas Price = Max Tx Fee


50,000 20 gwei 0.001 ETH

Ashish Kumar (+91-9876061725)


• There is fee for storage too.

Transaction • Not only is gas used to pay for


computation steps, it is also
Fees - GAS used to pay for storage use.

• Imposing fees prevents users


from overtaxing the network.

Ashish Kumar (+91-9876061725)


• The global “shared-state” of Ethereum is comprised of a list of
many objects [key-value pairs] called “accounts” that can interact
with one another through a message-passing framework

• Each account has a state associated with it and a 20-byte address


which is usually the public key of the account owner.

ETHEREUM There are two types of accounts :

ACCOUNTS
• Externally Owned Accounts (EOA), which are controlled by
private keys and have no code associated with them.

• Contract Accounts (CA), which are controlled by their contract


code and have code associated with them.

Ashish Kumar (+91-9876061725)


Code, immutable in nature, saved on a blockchain

Has a predictable outcome as per the logic defined

Smart Contracts
(generally written “CODE IS LAW”

Solidity language)
Help to automate processes and avoid middleman.

Common examples are deFi applications ( tokens,


lending, swapping), NFT, Gaming, Voting.

Ashish Kumar (+91-9876061725)


A Decentralized Application, or DApp, is an
application which is mostly or entirely decentralized.

Consider all the possible aspects of an application


that may be decentralized:

Decentralized ● Front-end software


Apps (DApp)
● Back-end software (application logic)

● Data storage

Ashish Kumar (+91-9876061725)


Phone/WhatsApp : +91-9876061725

LinkedIn : in/ashishk74

THANK YOU
E-mail : [email protected]

Skype : ashish.kumar0725

Ashish Kumar (+91-9876061725)

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