Blockchains serve as excellent records of transactions. Blockchains are records, but what makes changes to those records is known as a “state machine.” A state machine updates the state of the blockchain from a previous to a new state.
Bitcoin was the first widely-used blockchain. Its state machine is responsible for very basic features, essentially executing transactions between people. It’s very hard to do anything with Bitcoin other than send or receive funds; that’s all the state machine can do.
Ethereum was created to improve upon this model. The key changes Ethereum made were that the blockchain could store code & the state machine could execute it. Ethereum’s state machine is what we know as the EVM & can execute both transactions and custom code.
The Ethereum Virtual Machine is capable of executing any program or algorithm, given enough resources. In computer science terms this means it is a Turing-complete machine. Any program can be built on this new operating system, available to all, censorable by none.
To better understand the EVM, we should quickly review what a transaction is on Ethereum. A transaction is a message with either funds, data, or both, between people and programs. People are known as Externally Owned Accounts & programs are called smart contracts.
Transactions with smart contracts can include funds or data, or both. When funds are sent to a smart contract, the smart contract can hold them or perform actions with them. The types of actions performed by the smart contract depend on the data in the transaction.
To be more specific, when a transaction is sent the EVM looks at what it contains, then executes the smart contract’s code based on the data & funds inside. The result is recorded on the blockchain. The blockchain is the record & the EVM is what causes changes to it.
I hope you enjoyed this write-up on the EVM! This knowledge will be important for my upcoming write-ups on EOF, Transient Storage, Verkle Trees, and many more!
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