A blockchain is a distributed ledger architecture based on peer-to-peer topology, where each node has access to that database to execute and record the same transactions. These transactions are grouped in the form of blocks each of which contains a one-way hash value. Each new block is verified independently by peer nodes and added to the chain when a consensus is reached.
Ethereum is an open-source blockchain platform that allows blockchain developers to build and use decentralized blockchain applications. It is a programmable blockchain that allows users to create their own operations, coded as Smart Contracts. These smart contracts are deployed and executed by the Ethereum Virtual Machine (EVM) running inside every node.
Difference Between Public and Private Blockchain Networks
Using EVM both the public and private blockchain networks could be developed. The public blockchain is open to anyone who wants to deploy smart contracts and Bitcoin is one of the largest public blockchain networks today. The mining nodes participating in the public blockchain require a hash value to maintain the distributed ledger on a large scale. In the Ethereum public blockchain, smart contract codes are visible publically to all nodes.
However, a private blockchain is completely the opposite. It is set up within the safety guidelines within an organization. All the nodes participating in private blockchain transactions are authenticated and authorized machines. Private Ethereum blockchains are deployed by private entities to use in the production or in the software development process. Some blockchain developers choose an Ethereum branch that does not depend on mining whereas some prefer a modification of the most up to date Ethereum node. This is so because the unchanged Ethereum node takes about 15 seconds per new block, while the mining functions dramatically low.
How to Setup Private Ethereum Blockchain Development Environment
Start with creating a directory for this exercise which would be used to hold binaries and configuration files.
Step 1: Install Ethereum and Geth
Step 2: Generate the authority account and transaction account
Step 3: Create the genesis file
The contents of the Genesis file, in brief, are as follows:
- chainId – This is the chain identification number that is used to distinguish between Blockchains
- Homestead block, eip155Block, eip158Block, byzantiumBlock – Set these properties to 0.
- Difficulty – This number decides how difficult the blocks will be to mine. For Private networks, it’s good to set a lower number as it lets you mine blocks quickly, which results in fast transactions.
- gasLimit – This number is the total amount of gas that can be used in each block.
- alloc – This part is used to allocate ethers to already created accounts.
The Genesis file is ready. Now, it’s time to start the Blockchain.
Step 4: Start your private Ethereum instance
Step 5: Initiate Data Directory
Result: A functional Ethereum blockchain
The above process takes about 20 minutes and results in a fully functional, private Ethereum blockchain environment in the cloud. This environment is ideal for decentralized application, proof-of-concept development, and provides fast and free transactions.
Creating Ethereum private blockchain development environment and then working on actual blockchain development is a technical process and could be difficult for startup businesses. However, if you have any queries or need consultation, simply contact 0xblock, we will serve you with the required development services along with post maintenance.