Whether you're a blockchain newbie or looking to deepen your Ethereum knowledge, understanding its foundational components is crucial. In this guide, we journey through Ethereum’s ecosystem step-by-step—from the accounts that start it all to the gas that fuels every interaction.
🏦 Accounts: Who Owns What?
Ethereum accounts are like digital identities. They store ETH, interact with contracts, and initiate transactions. There are two types:
Externally Owned Accounts (EOAs): Controlled by a private key (think MetaMask).
Contract Accounts: Controlled by deployed smart contract code.
Real-life example: Think of an EOA like your mobile banking app — you control your money directly. A contract account is more like an automated savings system that handles transfers for you based on set rules (e.g., round-ups).
📠 Transactions: How Things Happen
A transaction is a signed message from an account. It can:
Transfer ETH
Interact with a contract
Deploy a new smart contract
Each transaction contains:
from and to address
value (ETH being sent)
data (optional function calls or contract code)
gas limit and max fee
signature
Real-life: Imagine paying for your groceries with your debit card. You send money (ETH), the shop receives it (contract/account), and the receipt confirms the transaction.
🔍 Blocks: Batches of Transactions
Transactions are grouped into blocks, which are linked together in a chain. Each block contains:
A list of transactions
The previous block’s hash
Gas limit & gas used
Timestamp
State roots
This chaining ensures immutability.
Real-life: Think of blocks like pages in a diary. Once written and sealed, you can’t change past pages, and each new page builds on the last.
🚀 EVM: The Ethereum Virtual Machine
The EVM is Ethereum's core engine. It runs the logic defined in smart contracts across thousands of nodes.
Key Components:
Stack: Temporary workspace (LIFO)
Memory: Transient byte array
Storage: Persistent state
Program Counter: Tracks execution
Opcodes: Low-level instructions (e.g., ADD, CALL)
Real-life: Picture the EVM like your phone running an app. You tap a button (transaction), and the app (smart contract) runs code in the background to show results or save data.
⚡ Gas: Fuel of the Network
Gas measures computational effort. Each opcode has a fixed gas cost. Gas ensures fairness, prevents infinite loops, and compensates validators.
📊 Sample Gas Costs
| Operation | Gas Cost |
|---|---|
| ETH Transfer | 21,000 |
| SSTORE (write) | ~20,000 |
| CALL (external call) | ~700 |
| ADD | 3 |
⚖️ Fee Calculation
Fee = Gas Used × (Base Fee + Priority Fee)
Real-life: Just like your mobile data bundle gets used when streaming a video, your ETH gets consumed when using Ethereum — even if the video buffers (the transaction fails), your data (gas) is still spent.
🧑🏫 Summary Flow
Account initiates a Transaction
The transaction is added to a Block
EVM executes the logic
Gas is consumed and part of it burned (EIP-1559)
State is updated across the network
🔍 Key Terms Explained
EOA: Wallet controlled by a private key
Smart Contract: Autonomous code-based account
Opcode: EVM instruction
Base Fee / Priority Fee: Define transaction cost under EIP-1559
👋Conclusion
Ethereum isn’t magic—it’s a well-orchestrated machine. Understanding accounts, transactions, blocks, EVM, and gas gives you the blueprint to build, audit, and interact confidently in the Web3 space.
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