Understanding of following concepts is critical as they are stepping stones for a more in-depth understanding of Ethereum:
Ether and its denominations
Ethereum’s currency is ETH, short for ETH. ETH is subdivided into further denominations, the smallest being ‘Wei’. Have a look below.
It’s worth noting that subunits of Ether has scientific names as per international System of Units (SI), alongside corresponding aliases of some of the great minds of the industry. It’s a way of paying respect to their contribution to computing and cryptography by the community.
It’s a software that manages the access to Ethereum account, by storing keys and initiating transactions on the owner’s behalf. There bare basically 3 types of wallets: mobile-based, desktop-based, and web-based. There are multiple wallets available with different features and designs. It’s just a matter of personal choice.
In case you don’t like the wallet, migrating to a new wallet just takes moving funds from old wallets to a new one or simply importing your private keys to a new wallet. For now, the following are some of the populate wallets available:
- MetaMask: This is a web-based wallet which can be added to multiple browsers as an extension. It is convenient for use. It can easily connect to Ethereum as well as test blockchains, making it an ideal candidate for testing.
- Jaxx: This is a mobile as well as a desktop-based wallet and it can run on multiple operating systems (Windows, Linux, iOS, Android, etc). It’s designed to be convenient, making it suitable for beginners.
- MyEtherWallet: MEW, short for MyEtherWallet is a web-based ether wallet that runs on the browser.
Ethereum is a programmable blockchain. Like any other application development platform, Ethereum has public testnets (read test networks) where DApps (Decentralized Applications) are tested prior to migrating to mainnet (read main network). Following is the list of all the networks:
- Mainnet: As mentioned earlier, this is the main Ethereum network where ETH has real values and where the real action takes place.
- Ropsten Testnet: This is a public test blockchain network and ETH on this network has no value. It is a proof of work (PoW) consensus mechanism based network.
- Kovan Testnet: This is also a public test blockchain network like Ropsten testnet, but it employs Proof of Authority (PoA) as its consensus mechanism. It is developed and maintained by Ethereum developers. ETH has no value on this network.
- Rinkeby Testnet: Like Kovan testnet, RInkeby is a proof of authority (PoA) based public test blockchain network. Eth here has no value.
- LocalHost 8548: This connects to the node running on the computer and node can be part of mainnet or any testnet.
- Custom RPC: It allows us to connect to any node with a geth-comptible remote procedure call (RPC) interface, where the node can be a part of the mainnet or the testnet.
There are two types of accounts in Ethereum.
- Externally Owned Account (EOA): This is the type of account which is created in wallets. These accounts have a private key that grants access to funds and transfers.
- Contract Account: This type of account has a smart contract stored in it. The contract account does not have a private key.
When a transaction has a contract address as destination, it means the transaction is trying to invoke the smart contract. In such a case, transaction data is used as an input to a smart contract. Transaction data can be ETH as well as the specific functions of smart contract and their parameters.