Ethereum has created a virtual environment that allows smart contracts to interact with each other that it calls the Ethereum Virtual Machine. It allows smart contracts to have greater functionality without having to become overly complicated.
A global supercomputer? That’s how Ethereum’s Virtual Machine has been described. It takes all the transactions your computer could do: send and receive things like cash, documents and contracts and transforms them on a global scale.
We show you how.
Bitcoin is like a basic version of what a blockchain can do. You have a unit of value, a Bitcoin, and you can send and receive bits of that value between you and other people.
Ethereum came along and allowed people to build smart contracts and Dapps using blockchain technology.
Read more about smart contracts and Dapps over here.
Once Ethereum allowed smart contracts to be created, the next step was to create an environment where all those smart contracts live and interact with each other. That’s where Ethereum’s Virtual Machine (EVM) comes in.
Let’s say you want to create a way for you and three roommates to buy things for the house you live in. You are essentially building your own smart contract.
There are a number of things you want your smart contract to cover.
So that’s now all working. But let’s say you want to allocate certain amounts of money every week for house supplies. You create a separate smart contract that says:
Then let’s say you want to buy a TV, but some of you only want to contribute a certain amount of money towards it. Here comes another contract. That contract says:
Can you see how these contracts all rely on an awareness of the contracts that come before them? This is the Ethereum Virtual Machine. An environment where all these contracts live, interact and influence each other.
It’s like a messaging service for smart contracts. 💬
Beyond the fact that you can avoid the pitfalls of living with roommates? There are lots of things EVM can help do.
Much like the website you are reading this article on, the EVM is built on a coding language.
Famous ones that already exist include Java, Python and Ruby.
The EVM has its own, called Solidity. It’s a language that lets people build smart contracts that can interact with other smart contracts easily.
We are just at the beginning of the virtual machine. In future, the complexity, speed and ability of the virtual machine will increase, much like the computers from the beginning of the PC-era became faster and more able to do complex things.