You have 1 DAI.

Using a wallet's UI (like Metamask), you click enough buttons and fill enough text inputs to say that you're sending 1 DAI to 0xd8dA6BF26964aF9D7eEd9e03E53415D37aA96045 (that's vitalik.eth).

And hit send.

After some time the wallet says the transaction's been confirmed. All of sudden, Vitalik is now 1 DAI richer. WTF just happened?

Let's rewind. And replay in slow motion.

Ready?

Index

1. Building the transaction
   • Serialization
2. Execution
   • The call
   • EVM execution
3. Afterword

Building the transaction

Wallets are pieces of software that facilitate sending transactions to the Ethereum network.

A transaction is just a way to tell the Ethereum network that you, as a user, want to execute an action. In this case that'd be sending 1 DAI to Vitalik. And a wallet (e.g., Metamask) helps build such transaction in a relatively beginner-friendly way.

Let's first go over the transaction that a wallet would build. It can be represented as an object with fields and their corresponding values.

Ours will start looking like this:

{
    "to": "0x6b175474e89094c44da98b954eedeac495271d0f",
    // [...]
}

Where the field to states the target address. In this case, 0x6b175474e89094c44da98b954eedeac495271d0f is the address of the DAI smart contract.

Wait, what?

Weren't we supposed to be sending 1 DAI to Vitalik ? Shouldn't to be Vitalik's address?