Ethereum Transaction

An Ethereum transaction is a signed message from an account that asks the Ethereum network to change its shared state. The simplest transaction sends ether from one address to another; others transfer tokens, deploy new smart contracts or call functions in existing ones, for example to swap coins on a decentralized exchange. Every transaction must be paid for with gas, priced in ether.

Only an externally owned account, one controlled by a private key, can start a transaction. Contracts can react to a transaction and call other contracts, but those follow-on calls are recorded as part of the original transaction, not as separate ones. Transactions are bundled into blocks by validators on the Ethereum blockchain and, once included, form part of its permanent history.

An Ethereum transaction is like a signed instruction slip handed to a bank teller, except that the teller is a worldwide network of computers. The slip says who is sending, who is receiving, how much, and any extra instructions. The signature proves the sender wrote it. A numbered sequence on each slip stops anyone from copying an old slip and handing it in twice.

The sender also attaches a fee, a bit like a postage stamp. A bigger stamp tends to get the letter picked up sooner when the post office is busy. If the instruction asks for more work than the sender agreed to pay for, the work stops and the fee is still charged.

• Nonce. A counter of how many transactions the sending account has sent, which sets the order and blocks replays; see nonce.
• Recipient and value. The destination address and the amount of ether, which can be zero when the purpose is to call a contract.
• Data. Optional input that encodes which contract function to call and with what arguments, or the code of a new contract.
• Gas limit and fee caps. The maximum units of computation the sender will pay for, and the most it will pay per unit.
• Chain ID and signature. An identifier for the network and a digital signature made with the sender's private key.

Since the EIP-1559 upgrade of 2021, each block has a base fee set by the protocol, which is burned, and senders add a priority fee, or tip, for the validator. The fee paid is:

• Gas used is the number of computation units the transaction actually consumed.
• Base fee is the protocol's per-unit price for that block, quoted in gwei.
• Priority fee is the per-unit tip offered to the validator.

A plain ether transfer uses 21,000 gas. With a base fee of 20 gwei and a tip of 2 gwei, the fee is 21,000 × 22 = 462,000 gwei, or 0.000462 ETH. Contract calls use far more gas. If a transaction runs out of gas, its changes are undone but the gas spent is still charged; the related settings are described under gas limit.

Ethereum has added transaction formats over time while keeping older ones valid. Legacy transactions carry a single gas price. Type 1 transactions, from 2021, added optional access lists. Type 2 transactions introduced the base-fee and tip model of EIP-1559 and are now the most common. Type 3 transactions, added in the Dencun upgrade of 2024, carry "blobs" of data used mainly by rollups. A further type added in 2025 lets ordinary accounts temporarily take on smart-contract features, part of the wider push towards account abstraction.

1. A wallet builds the transaction and the user signs it with the private key.
2. The signed transaction is broadcast to network nodes and waits in the mempool.
3. A block builder or validator selects it, usually favouring higher tips, and includes it in a block.
4. The network executes it in the Ethereum Virtual Machine and records a receipt showing success or failure, gas used and any events.
5. Later blocks build on it, and after about two epochs, roughly 13 minutes, it is treated as finalized.

Anyone can look up a transaction by its hash on a blockchain explorer. Pending transactions are public, which is why some are exposed to front-running by bots that copy or reorder trades before they are confirmed.

• Ethereum.org: Transactions