Unpacking Ethereum

Abstract

Ethereum is an open source, decentralized, blockchain platform with computational capabilities that reconstruct elementary currency exchange into a transfer of value between users via a scripting language. Ethereum is widely recognized as a successor to the Bitcoin protocol, generalizing the original ideas and enabling a more diverse array of applications to be built on top of blockchain technology. Ethereum has two essential components. The first is a Turing-complete virtual processor that can load resources and execute scripts, called the Ethereum Virtual Machine (EVM). The second component is a token of value called Ether, which is the currency of the network used for user-to-user transactions or compensation to miners of the network. In this chapter, we begin our journey by exploring the architecture of Ethereum, focusing on the EVM and Turing-completeness properties. Following the architecture, there will be a short discussion on PoS in Ethereum, the currency Ether, and gas, which is a spam-prevention mechanism in the network. Then, we deconstruct the notion of a smart contract enabled by EVM, the security concerns revolving around sandboxing executable code, and how the EVM pushes executable code (bytecode) to the blockchain. After that, we dive deeper into Solidity, the programming language behind writing smart contracts with Ethereum. We explore the syntax of the language and the common integrated development environments (IDEs) being used to work with it. Next, we look at a few enterprise applications of Ethereum that have recently become available, particularly the blockchain-as-a-service deployed on the Azure cloud by Microsoft. Finally, we will end our journey with a look at the structure of a distributed app (Dapp) built on top of Ethereum and showcase an example of a decentralized publishing application where posts are stored permanently without any fear of censorship.