Ethereum Virtual Machine (EVM): The Essential Introduction

Everything you need to know about the Ethereum Virtual Machine (EVM), how it works, and its architecture.
Written by
Shivam Srivastava
September 30, 2023
min. read

Blockchain technology has revolutionized the way transactions are conducted and verified over the internet. Among the vast number of blockchain platforms, Ethereum stands out as a pioneering framework enabling decentralized applications. 

Central to Ethereum's functionality is its computing brain, the Ethereum Virtual Machine (EVM), which acts as the execution hub for smart contracts on the Ethereum network.

First and foremost, let’s land a short, clear definition of EVM.

What is Ethereum Virtual Machine (EVM)?

The Ethereum Virtual Machine (EVM) is the computational engine of the Ethereum network, responsible for executing smart contracts. It's a Turing-complete system that operates in isolation, ensuring that contract interactions don't affect the main blockchain. Every operation within the EVM consumes "gas" to measure and limit computational work. While typically associated with the Solidity language, the EVM is language agnostic, allowing various programming languages to be used as long as they compile to EVM bytecode. Its decentralized design ensures that all nodes in the Ethereum network verify every action, reinforcing Ethereum's trustless and decentralized nature.

In this article, we’ll expand on each part of this definition, giving you the essential details needed to understand how Ethereum Virtual Machine works. 

Understanding Ethereum Virtual Machine (EVM) in Detail

The EVM is a quasi-Turing complete machine that serves as the runtime environment for smart contracts in Ethereum. It plays a critical role in executing the unchanging byte code produced by the compilation of smart contract code. 

The EVM operates within the Ethereum ecosystem to ensure the deterministic execution of smart contracts, which is vital for maintaining trust and consistency across the network.

Working Mechanism of EVM

The Ethereum Virtual Machine (EVM) is an intricate mechanism designed to execute smart contracts on the Ethereum blockchain. A closer look at its working mechanism reveals a structured approach towards executing bytecode, managing computational resources, and transitioning network states. Here's an expanded elucidation of the working mechanism of EVM:

Bytecode Execution:

Compilation: Smart contracts, usually written in high-level programming languages like Solidity, are compiled down to a more basic form known as bytecode. This bytecode is a sequence of instructions that can be executed by the EVM.

Opcodes: Bytecode comprises a series of opcodes (operation codes) that are executed by the EVM. These opcodes perform various functions including arithmetic operations, data storage, and retrieval, among others.

Stack-Based Execution: The EVM operates as a stack machine, where operations are executed in a last-in, first-out (LIFO) manner. Instructions in the bytecode may push data onto the stack or pop data from the stack, executing computations accordingly.

Gas System:

Gas Measurement: Every operation or computation in the EVM has an associated gas cost, which is a measure of the computational work required to execute the operation.

Gas Limit and Price: Transactions specify a gas limit and gas price. The gas limit is the maximum amount of gas units that a transaction can consume. The gas price is the amount of Ether a user is willing to pay for each unit of gas.

Resource Allocation: The gas system ensures fair resource allocation, preventing abuse by imposing costs on operations and storage, which in turn dissuades spam and malicious activities on the network.

Transaction Processing: Transactions are processed by miners who prioritize transactions offering higher gas prices. The gas fee paid by users is a form of incentive for miners to validate and include their transactions in the blockchain.

More on understanding Ethereum gas prices and fee management can be read in this article.

State Transition System:

Initial State: The Ethereum network at any given block has a specific state, encompassing all account balances, smart contract code, and data.

Transaction Execution: Transactions initiated by external actors or triggered by smart contracts lead to execution of operations in the EVM, which may alter the state of the network.

New State Computation: Post transaction execution, the EVM computes a new valid state, transitioning from the old state to the new state following a predefined set of rules.

State Commitment: The new state is committed to the blockchain, and a new block is generated encapsulating the transactions and the resulting state transitions.

State Retrieval: The Ethereum state is stored in a data structure known as a Modified Merkle Patricia Trie, which allows for efficient retrieval and verification of the network state.

The orchestration between bytecode execution, the gas system, and the state transition system underpins the deterministic and secure operational framework of the EVM, enabling a robust environment for smart contract execution and decentralized applications on the Ethereum blockchain.

Architecture of EVMs

The architecture of the Ethereum Virtual Machine (EVM) is meticulously crafted to ensure a secure and efficient execution environment for smart contracts. The key components of its architecture include:

Bytecode: The EVM executes bytecode, which is a low-level, machine-readable instruction set. Smart contracts written in high-level languages like Solidity or Vyper are compiled down to EVM bytecode, enabling them to be executed on the network.

Stack: The EVM operates a stack-based architecture, where operations are executed via a last-in, first-out (LIFO) data structure. This stack architecture facilitates the execution of complex computations and logical operations within the smart contracts.

Memory: The EVM has a dedicated memory space where data can be stored temporarily during execution. This memory is ephemeral and gets erased after the execution of the smart contract.

Storage: Unlike memory, storage is a persistent data storage space on the blockchain where data can be saved indefinitely. Each smart contract has its own storage space which can be accessed and updated during execution.

Gas: The concept of gas in EVM architecture is fundamental for managing resources and preventing spam on the network. Gas measures the computational work involved in executing operations and enforces a limit to control the resources used by each transaction.

EVM Security Features

EVM enforces a strong isolation policy for smart contracts, ensuring that they operate in a completely isolated environment. This isolation prevents contracts from accessing each other's state, thereby guarding against re-entrancy attacks which could otherwise lead to a cascade of failures across multiple contracts. Besides, various other security measures like gas limits and stack depth limits are employed to ensure the robustness and security of the network.

Security in EVM is paramount. The isolation of smart contracts ensures a safe execution environment, preventing re-entrancy attacks. Moreover, EVM's deterministic nature, emanating from its state transition function Y(S,T)=S′, where S is an old valid state and T is a new set of valid transactions, ensures predictable, secure outcomes.

EVM Advancements and Upgrades

Over the years, EVM has seen numerous upgrades aimed at improving its efficiency, security, and functionality. Notable among these are the various Ethereum Improvement Proposals (EIPs) which have significantly impacted the EVM's performance. The impending shift to Ethereum 2.0 promises further enhancements, especially with the introduction of sharding and Proof of Stake (PoS) consensus mechanisms, which are expected to influence the working of EVM considerably.

What are EVM Compatible chains?

Ethereum Virtual Machine (EVM) forms the core of Ethereum, powering its smart contract functionality. However, the EVM's influence extends beyond just Ethereum through EVM compatible chains. These chains, while distinct, maintain EVM compatibility, enabling a seamless interaction with Ethereum-based applications.

Here are some of the leading evm chains list for various use cases in the cryptoworld which dominate the use cases mentioned as top evm chains amongst the all evm chains out there :

  1. Enterprise Use Case: Polygon shines for enterprise solutions as an evm chain of choice, As onboarding enterprises into web3 not just requires a great technical solution but also the thought leadership which can help enterprises envision the possibilities of the web3 world.
  2. Gaming Use Case: Immutable: With a focus on gaming, Immutable provides a platform where players have true ownership of in-game assets. By leveraging the power of EVM, Immutable not only enhances gaming experiences but also pioneers the transformation of gaming economies, making the virtual worlds interoperable and user-centric.
  3. DeFi Use Case: Arbitrum: In the realm of DeFi, Arbitrum stands tall, offering a scalable infrastructure that's pivotal for high-performance financial applications, while maintaining a strong level of security and decentralization, essential for the burgeoning DeFi landscape.

Real-World EVM Applications and Examples

Various projects built on Ethereum manifest the versatile utility of EVM across different sectors. For instance, the decentralized finance (DeFi) sector leverages the EVM's smart contract execution capability to facilitate trustless financial transactions. Several case studies underscore the EVM's pivotal role in fostering innovation in areas like supply chain management, healthcare, and the gaming industry.

Here's a list of various types of dApps and some examples in each category:

Decentralized Finance (DeFi)

  • MakerDAO: A decentralized credit platform that supports Dai, a stablecoin whose value is pegged to USD.
  • Compound: A decentralized lending platform where users can earn interest or borrow assets.
  • Uniswap: A decentralized exchange protocol that allows for token swaps directly from a user's wallet.

Decentralized Autonomous Organizations (DAOs)

  • Aragon: A platform for creating and managing DAOs.
  • MolochDAO: Focuses on sustainable Ethereum development by providing grants.

Gaming and Collectibles

  • CryptoKitties: One of the first blockchain-based games where users can collect, breed, and sell virtual cats.
  • Decentraland: A virtual reality platform where users can buy, develop, and sell parcels of land.


  • OpenSea: A decentralized marketplace for digital goods and collectibles.
  • Rarible: A marketplace for creating, buying, and selling non-fungible tokens (NFTs).

Identity and Reputation Systems

  • Serto: Provides users with a sovereign identity on the Ethereum blockchain.
  • Civic: A platform that offers identity verification solutions.

Infrastructure and Development Platforms

  • Tatum: Provides JavaScrip SDK for Ethereum and Node infrastructure for developers to help them connect dApps to the Ethereum network.
  • Chainlink: A decentralized oracle network that facilitates smart contracts to securely interact with real-world data and APIs.

Social Networks and Content Platforms

  • Peepeth: A decentralized alternative to Twitter.
  • Cent: A social network where users can earn money by answering questions or curating content.

Storage Solutions

  • Filecoin: A decentralized storage system where users can rent out their storage space.
  • Storj: A decentralized cloud storage platform.

This is just a snapshot of the diversity of applications built on the Ethereum platform leveraging the EVM. The Ethereum ecosystem is vast and constantly evolving, with new projects and ideas emerging regularly.


EVM is the cornerstone of the Ethereum ecosystem, embodying security, efficiency, and upgradability in its architecture. Its evolutionary journey, marked by continual upgrades and an expanding list of EVM compatible chains, underscores its pivotal role in the broader blockchain arena. Us Web3 devs know, Ethereum is and will remain the core blockchain for Web3 app development.

Learn about zkEVMs next and how they help Ethereum scale through Zero Knowledge rollups.