Transmission Lines
The type of transmission line used to connect two devices (chips, modules) dictates the type of signaling to be used. Single-ended signaling is used with coaxial cables, in which one conductor totally screens the other from the environment. All screens (or shields) are combined into a single piece of material to form a common ground. Differential signaling is used with a balanced pair of conductors. For short cables and low frequencies, the two methods are equivalent, so cheap single-ended circuits with a common ground can be used with cheap cables. As signaling speeds become faster, wires begin to behave as transmission lines.
Read more about this topic: Differential Signaling
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