What Is an Ethereum Transaction?
It represents the transfer of value or the execution of a function within the Ethereum ecosystem.
In the context of cryptocurrencies, an Ethereum transaction is typically initiated by an externally-owned account, which is an account managed by a human rather than a smart contract.
From Initiation to Immutable Record
Once a transaction is created, it needs to be validated and agreed upon by the Ethereum network according to its consensus rules.
The structure of an Ethereum transaction is defined by a message encoded using the Recursive Length Prefix (RLP) encoding format.
This message contains various fields, including:
- Recipient: The account address to which the transaction is being sent.
- Value: The amount of Ether (ETH) to transfer from the sender to the recipient. This value can be zero if the transaction is for executing a function on a contract without transferring Ether.
- Data: An optional field that can contain arbitrary binary data. In the case of contract deployment, it typically includes the bytecode of the contract.
- Gas Limit: The maximum amount of gas that the transaction can consume during execution.
- Gas Price: The price the sender is willing to pay for each unit of gas consumed by the transaction.
- Nonce: A sequence number that is specific to the sender’s account and ensures the transaction’s order and uniqueness.
- Signature: Data that identifies and authenticates the sender of the transaction.
By including these details in a transaction, Ethereum provides a flexible and powerful platform for executing various actions, including value transfers, smart contract interactions, and decentralized application (dApp) operations.