Ethereum and It's Working

• It is a public trustless and most secure transactional peer to peer system which keeps records of transactions in a public database.
• It is a transaction-based state machine where state refers to the series of inputs which will in turn leads to transition to a new state after some processing mechanism.
• When no transaction is taking place or when a system sits ideal. In that situation the state refers to a genesis state.
• Each state of Ethereum contains millions of transactions that are gradually grouped into blocks and each block is linked with previous block that are chained together with the help of cryptographical chains.
• In order to cause a transaction from one state to another, it is essential to check the validity, authenticity of that transaction which can be achieved through a validation process called mining.So, Mining refers to a group of computers or nodes with in a network use their computational resources to create a block of valid or authentic transactions.
• Next step is to link or add the valid blocks in a block chain. This task is performed by miner in a faster way than any other competitor miner and for this miner has to provide a mathematical proof is known as a proof of work.
• Every time a miner validates a certain block, is awarded with a reward of value. The value is nothing but it is an intrinsic digital token called “Ether.” produced by Ethereum Blockchain.

You may be wondering:

What guarantees that everyone sticks to one blockchain? Can you confirm? In the past, we defined a blockchain as a singleton transaction machine with shared state. This definition helps us understand that the correct current state is the single global truth that everyone must accept. Having multiple states (or chains) messes up the whole system because it becomes impossible to agree on which state is correct. If the chain forks, you can have 10 coins on one chain, 20 coins on another chain, and 40 coins on another chain. There is no way to determine which chain is "best" in this scenario.

**A "fork" happens each time **many pathways are created. Forks are normally something we want to avoid because they mess with the system and require individuals to pick which chain they "believe" in.

​

Ethereum utilizes a system known as the "GHOST protocol" to decide which path is the most reliable and avoid numerous chains. Greedy Heaviest Observed Subtree, or "GHOST," In plain English, the GHOST protocol states that we must choose the path on which the greatest computation has been performed. The block number of the most recent block (the "leaf block"), which represents the total number of blocks in the current path, can be used to calculate that path (not counting the genesis block). The length of the path and the amount of mining required to reach the leaf increase with increasing block number. We can agree on the canonical description of the present state by applying this logic.