Friday, 6 October 2017

Ether Sandman

Ok so we did a ton of work on Bitcoin, from building the standard wallet framework to experimenting with multi signatures and colored coin concepts.

We knew that we wanted to focus on Smart Contracts as our core business, but Bitcoin was built to be implemented as a currency. It's colored coins implementation is fairly limited in order to do what we dreamed of doing with this technology. So after reading a lot of literature on the subject, we decided to focus on the Ethereum Blockchain. Ethereum's cryptocurrency, Ether (ETH) is currently the second largest cryptocurrency in circulation in the market with a market cap of over USD 30 Billion.

The beauty of Ethereum is that it is designed as a smart contract platform via the Ethereum Virtual Machine (EVM). It even comes with its own object oriented scripting language called Solidity.

Now when talking about these cryptocurrencies, they are ingeniously crafted to sound cool and relate in a meaningful way. As an example, Bitcoin's unit of measure is called Satoshi, while Ethereum's unit of measure is called 'gas'. So when I write in this blog about passing gas to pay for my smart contracts... it is NOT what you think.

Some other key differences between Ethereum and Bitcoin Blockchains are listed below:

Token / CurrencyEther (ETH)Bitcoin (BTC)
Language baseTuring completeStack based
SupplyInflationary - more tokens can be made over timeDeflationary - a finite number of bitcoin exists
Block time10 to 20 secondsApprox. 10 minutes
PurposeSmart contract platformCryptocurrency
UsageUsed to make decentralized applications (Dapps) for the purpose of facilitating smart contractsA virtual currency used for purchasing goods and services and storing assets such as gold etc.

As a platform Ethereum provides us software developers with a few advantages:
  • Cryptographic integration to user authentication
  • Customizable payment logic 
  • Ability to create a payment gateway without the need for a third party provider
  • Decentralized architecture guaranteeing 100% D-dos resistant up-time
  • Lots of data storage
  • Interoperability; everything in the Ethereum ecosystem can interact with everything else
  • Whole applications can be deployed on the Blockchain with no server deployments requried
While it is true that you don't need any servers to run on the Ethereum network, we wanted to learn to create our own private chain utilizing the Ethereum engine. Ethereum's engine is well designed and flexible in its implementation methodology.

We are .NET developers by trade so our medium of choice was to utilize its Web3 Javascript Dapp API and wrap it around our development framework. We then setup our environment on Microsoft's Azure Cloud Platform and deployed our first Ethereum genesis block.

From there on we deployed our private crypto-token called Krypt and started building a Ethereum based Krypt wallet into our demo framework. For now Krypt only exists on our private network and used as experimental tokens in our work.

Another practical yet crucial reason why we chose Ethereum is that it has a wide usage across the cryptocurrency and crypto-token ecosystem. It's market cap as of this writing is almost USD 30 Billion with a node network that spans across the globe:

So based on the three Blockchain principles that we discussed in our earlier blogs, Ethereum fits the bill just nicely. Ask yourself, if we were to develop a solution for your industry, would you want it to run on top of a Blockchain framework with literary tens of thousand of nodes, or a 20 node Blockchain that someone created and deployed in his data center?

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