Change Puzzle: Understanding the role of ethereum for unjustified entrance reduction
When it comes to digital currencies such as Bitcoin, the concept of “change” can be puzzled. If you want to give someone a certain amount of cryptocurrency, say 0.22 BTC and you have a record Bitcoin (1BTC), how does the system solve this problem?
The answer consists of Ethereum, a decentralized platform that allows programmable smart and blockchain contracts.
How to cut Ethereum’s unjustified entrance
Bitcoin, when you want to send coins, you need to create a new deal with their public address. The recipient’s wallet will then check the transaction and add it to your block chain. This process is known as “extraction” or “evidence of work”.
However, if the sender has several inputs (in this case, 1BTC), which they want to combine in one exit (0.22 BTC), it is not possible to simply divide the transaction into small parts. Ethereum comes here.
The Ethereum’s unanimity algorithm is based on a node network that confirms transactions and maintains a blockchain. When a node receives a new transaction, it checks its validity by checking the sender’s identity, the recipient’s address and the amount sent.
To solve this problem, Ethereum introduces the term called “Unjustified Investments”. Unjustified entrances come from previous transactions that have not yet been spent. These unjustified entrances are then combined with other inputs to create a new output (for example, 0.22 BTC) in such a way as to ensure that each output is fully spent.
This process of unjustified raw materials is known as “expenses” or “redemption”. When sending coins from the wallet to someone else’s wallet, the recipient’s node checks whether there are unjustified records in the sender’s account. If not, add these unjustified records to your block chain and combine them with new entrances to create one output.
How can Alice give 0.22 btc
Now that we understand how Ethereum resolves unjustified records, apply this concept into our example. Let’s say the wallet has 1BTC and you want to give Alicei 0.22BTC.
Here’s what happens:
- Create a new deal with the addressee’s address and specify the amount (0.22 BTC).
- The knot checks the transaction, checks the unjustified entrance to your account and concludes that it is not.
- The knot combines unjustified entrances from previous transactions with yours to create one exit: 0.22BTC.
The transaction is added to Blockchain, and Alice’s wallet receives the new balance of 0.22 BTC.
Conclusion
In summary, Ethereum allows intelligent contracts to combine a number of unjustified investments using its term “unambiguous entrance”. This reduces the need to fully spend each individual output, which allows a large amount of cryptocurrency to be sent without a single transaction with all its accounting components.
As we continue to study the complexity of digital currency and decentralized applications, understanding how these concepts will work more and more.