How Ethereum works

The Ethereum blockchain is a decentralized, open-source blockchain that facilitates the execution of smart contracts. These are self-executing contracts with the terms of the agreement directly inscribed into the code. Ethereum's native cryptocurrency is Ether (ETH). Ethereum's blockchain comprises a sequence of "blocks" filled with transactions. Each transaction reflects a change in the Ethereum network's state, such as the transfer of ETH from one user to another, or the execution of a smart contract. Previously, miners used to validate these transactions and grouped them into blocks in a process known as mining. However, Ethereum recently transitioned from a proof-of-work mechanism to a proof-of-stake model, where validators now manage this process. The Ethereum blockchain operates on consensus, implying that a majority of nodes (computers within the Ethereum network) must agree on the network's state at any given moment. This consensus maintains the system's integrity and prevents double-spending, a scenario where a user might spend the same cryptocurrency more than once.