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INTRODUCTION TO ETHEREUM ECOSYSTEM
& SMART CONTRACTS
NPD Meet @ Divum Corporate Services Pvt Ltd.
Jitendra Kumar.Balla & Vaideeswaran sethuraman
AGENDA
1. What is a Blockchain?
2. Ethereum 3. Ethereum SMART Contracts
CENTRALIZED
Issues:
Single point failure
Scaling
Inefficiency
All activities are managed by one person/Organization
DECENTRALIZEDSolves:
Single point failure
Scaling
Inefficiency
Security and Transparency
Transaction time
INTRODUCTION TO BLOCKCHAIN
BLOCKCHAINA blockchain allows for trustless transactions between multiple parties. Or, more importantly, it allows transactions without trust of a third party intermediary!
Decentralized system for an exchange a value/asserts
○ Distributed ledger
○ Immutability
○ Consensus
○ Security
LET’S START WITH A TRANSACTION THAT OCCURS BETWEEN ACCOUNTS
Transaction #200
Account A Account BE.g. Send 2 tokens
An example transaction could be:
Account A will send 1 tokens to Account B
A LEDGER IS A LIST OF TRANSACTIONS (GROUPED INTO BLOCKS)
LEDGERBlock #100 Last Block: #99 (H) Timestamp: TM,
Transaction #399
Transaction #400
Transaction #401
Block #97Block #98
Block #99
Blocks contain an
indeterminate number of
transactions
BLOCKS ARE CHAINED TOGETHER
LEDGERBlock #100 Last Block: #99
Transaction #399
Transaction #400
Block #97 Block #98 Block #99
Blocks are generated on a
time interval(e.g. every 5
minutes)
The ledger is a chain of blocks! Each block is created with a pointer to the previous block creating a blockchain!
LEDGER
Distributed ledger = Distributed database
BLOCKCHAIN
Decentralized system for an exchange a value/asserts
○ Distributed ledger
○ Immutability
○ Consensus
○ Security
BLOCKCHAIN
Decentralized system for an exchange a value/asserts
○ Distributed ledger
○ Immutability
○ Consensus
○ Security
CONSENSUS
Consensus = Protocol by which peers agree on state of ledger
○ Ensure all peers in the network has exactly the same copy of ledger
○ Fraudulent transactions kept out of the ledger
○ Guarantees to record transactions in chronological order
BLOCKCHAIN
Decentralized system for an exchange a value/asserts
○ Distributed ledger
○ Immutability
○ Consensus
○ Security
SECURITY
Wow!!, thats cool stuff
Bitcoin:
- Transfer money- Fast transactions- Less fee- Transparent
Wow!!, thats cool stuff
Bitcoin:
- Transfer money- Fast transactions- Less fee- Transparent
Great Technology:
- Launch my sub currency - ICO (Crowdfunding)- Managing digital assets- Local laws
INTRODUCTION TO ETHEREUM
ETHEREUM
Ethereum is an open blockchain platform that lets anyone build and use decentralized applications that run on blockchain technology.
Ethereum is world of computers
HOW DOES ETHEREUM WORK?
○ Ethereum’s basic unit is the account
○ State of every account
○ The Ethereum blockchain tracks the state of every account, and all state transitions on the Ethereum blockchain are transfers of value and information between accounts.
ETHEREUM ACCOUNTS:
There are two types of accounts:
○ Externally Owned Accounts (EOAs)
○ Contract Accounts, which are controlled by their contract code and can only be “activated” by an EOA
ETHEREUM ACCOUNTS: Elliptic Curve Digital Signature Algorithm (ECDSA)
ETHEREUM ACCOUNTS:
○ Has an ether balance
○ Can send transactions (ether transfer or trigger contract code), EOA
○ Bytecode
○ Nonce
SMART CONTRACTS
ETHER, EVM, GAS
ETHEREthereum value token is called Ether
Denominations:
Unit Wei Value Wei
wei 1 wei 1
Kwei (babbage) 1e3 wei 1,000
Mwei (lovelace) 1e6 wei 1,000,000
Gwei (shannon) 1e9 wei 1,000,000,000
microether (szabo) 1e12 wei 1,000,000,000,000
milliether (finney) 1e15 wei 1,000,000,000,000,000
ether 1e18 wei 1,000,000,000,000,000,000
ETHER SUPPLY○ 48 days presale (July 2014): $ 60 M
○ 12M created to fund development
○ 5 Eth will created as rewarded for every block
○ 2-3 eths for non winning miners
○ Contract execution user pays Ether’s
ETHEREUM VIRTUAL MACHINE
○ Ethereum is “Turing complete”.
○ EVM will load bytecode and execute instructions
○ Every node will run eth client
GAS○ Gas is the metering unit for use of the World Computer
○ Each operation in the EVM consumes gas
○ totalEstGas = startgas * gasprice
Transactions0x60 0x01 0x60 0x02 0x01
Operation Name Gas Cost Remark
step 1 default amount per execution cycle
stop 0 free
suicide 0 free
sha3 20
sload 20 get from permanent storage
sstore 100 put into permanent storage
balance 20
create 100 contract creation
call 20 initiating a read-only call
memory 1 every additional word when expanding memory
txdata 5 every byte of data or code for a transaction
transaction 500 base fee transaction
contract creation 53000 changed in homestead from 21000
ETHEREUM TRANSACTIONS:
BITCOIN● Transactions based● Block creation ~10mins● Less number of transactions● Require high computation power● Not stopping big miners● Limited transaction based bitcoin
signature(128)● Limited functions● Peers can block list transaction ● SHA2 not so secure● SHA256 is not ASIC resistance
● Account based● Block creation ~12sec● Mining algorithm based on
memory usage (Gas)● Can decouple components● Rich programing language for
contracts (Solidity)● Uses SHA3● Customize protocol based on local
law● EthHash is ASIC resistance
ETHEREUM
INTRODUCTION TO ETHEREUM DAPPS
○ Ethereum Client’s
○ Installation of Geth
○ Geth commands
○ Web3JS Apis
○ Solidity
○ Smart contracts
○ Deploying smart contracts
ETHEREUM CLIENTS
eth pyethapp geth ethereumjs-lib
3rd Party Impl
ethereumj ruby-ethereum ethereumjs-lib parity
SOLIDITY
SOLIDITYSolidity is the most popular programming language used to write smart contracts to run on the Ethereum blockchain.
It is a high level language which when compiled gets converted to EVM bytecode.
This is very similar to the world of Java where there are JVM languages like Scala, Groovy, Clojure, JRuby etc.
SOLIDITY INTEGRATION TOOLS
IDE’s- Remix- IntelliJ IDEA plugin- Visual Studio Extension- Etheratom- Solium- Emacs Solidity- Package for SublimeText — Solidity language syntax
SOLIDITY INTEGRATION TOOLSSolidity Tools
- DappBuild tool, package manager, and deployment assistant
for Solidity.
- Solidity REPL
Instant command-line solidity console.
- solgraph
- Doxity
STRUCTURE OF A CONTRACT- Types
- Operators
- Functions
- Function Modifiers
- Events
- Enum Types
- Types
Booleans
Integers
Address
String
Enums
- Function Types
public, private, internal, external
- Function Modifiers
STRUCTURE OF A CONTRACT
- Types
Booleans
Integers
Address
String
Enums
- Function Types
Public, private, internal
- Function Modifiers
STRUCTURE OF A CONTRACT
TRUFFLE/EMBARK
We have frameworks for web application development such as Ruby on Rails, Python/Django etc, Truffle and Embark are the two most popular frameworks used to develop Dapps.
They abstract away lot of the complexities of compiling and deploying your contract on the blockchain.
LET’S CODE….