How to Create Own Blockchain Network using Ethereum?
Creating a blockchain network is not necessarily difficult. For example, Litecoin, Dashcoin or Stellar cryptocurrencies were created by individual people on the basis of other cryptocurrencies, which does not prevent them from taking top positions in the market. In this article, we will look at the three available ways for everyone to create their own blockchain network.
First, you need to come up with creating of blockchain network. Whether you want to beat Bitcoin, collect tips from financial transactions like Ripple, or integrate a new technology into a business - this should be outlined in advance. Since the purpose of using the blockchain depends on its functions and characteristics, therefore, the process of creating.
As an example, if you need to raise funds to finance a startup, you can use one of the popular platforms to launch ICO / STO (Ethereum, Waves or tZERO). For tokenization of business or creation of corporate blockchain networks, it is better to use one of the Hyperledger frameworks. Bitcoin, Litecoin or Monero sources are suitable for launching cryptocurrency.
At the same time, it is necessary to remember that the blockchain is not a “magic wand” that will increase cybersecurity, make the business effective and allow you to earn millions. It is possible that you will spend hundreds of thousands of dollars on its implementation, and there will be no effect.
The blockchain network is useful if needed:
- decentralized storage of large amounts of data, but provided that these are small files (up to 1 MB);
- to create a network with unique functions that are not implemented on existing traditional or blockchain platforms;
- to create a blockchain network with unique properties;
- to create your own cryptocoin or token.
Another important question is: “What type of blockchain should I choose?”. A blockchain can be public (decentralized) or private (centralized). The first option is suitable for networks where are needed transparency and the absence of parties that act as guarantors of the integrity of transactions or are sources of truth - the reliability of the data. Private blockchains are useful in the banking, industrial and corporate sectors where data privacy is needed.
Creating a blockchain network from scratch is an option for the blockchain development team or those who are willing to hire such and pay them big money (the average rate of the blockchain developers is $ 100 per hour). In addition, this approach may take a long time and at the same time does not give a workable final product.
That is why most startups follow a simpler, faster and more reliable path - they launch their own blockchain network using the fork of the existing cryptocurrency. So did the creators of the network Ethereum, Bitcoin Cash, Stellar, Litecoin, Bitcoin SV and many other cryptocurrencies.
Usually the existing cryptocurrency framework can be found on the Github service. It is the world's most popular open source collaborative software development site. If the framework is not on Github, you should look for it on SourceForge.
For example, on Github it is easy to find the source code of Bitcoin, Ripple (XRP) or Monero. To find another blockchain framework, you need to:
1. Register on the site and enter the corresponding request in the search box in the upper left, for example, Ripple.
2. Once you find the crypt, click on the icon «Fork». So we copy the Ripple framework (repository) into our account.
3. Click on the “Clone or download” icon to download the cryptocurrency repository to your computer and start editing.
You can make changes to the source code of the framework either manually or using special applications. The last option is much faster and easier, so it is better to use it. In the Windows operating system, this is done through the Search and Replace program or its almost one hundred percent equivalent HandyFile Find and Replace. For the Linux family, you can use Regexxer, for “apple” devices - TextWrangler.
Title. With this software, the first thing you need to change the name of the network and coins. Instead of the original names and symbols, we enter our own, replacing them with all variations. Suppose we take the Bitcoin blockchain network as the source code, and the name of our new crypt, TestCoin. Then change the name in the code as follows:
- Bitcoin — to TestCoin;
- BITCOIN — TESTCOIN;
- bitcoin — testcoin.
When choosing a name, you need to find something short, conspicuous and memorable, because this is the first thing investors and users will see when they get acquainted with your blockchain network.
Do not forget about the exchange designation of the coin - the abbreviation BTC. It also needs to be replaced. However, before you do this, you should check what abbreviations are already used. For example, the abbreviation for the TestCoin TTS coin is already taken - a coin with such an abbreviation symbolizes the TittieCoin cryptocurrency.
Number of coins. Next, you need to specify the maximum number of tokens for our network. It can be unlimited, as in Dogecoin and Ethereum cryptocurrencies. In this case, you need to take into account the fact that your token must be constantly used and destroyed, otherwise its money supply will constantly grow and, as a result, the coin will constantly depreciate.
Another option is to limit the size of the money stock, as in the Bitcoin network (21 million coins), Litecoin (84 million coins) or IOTA (2.77 peta coins, where 1 peta is 1000 in 5 degrees). The size of the restriction, as a rule, is chosen quite arbitrarily, focusing only on the fact that there are not too many coins and not too few.
You can also create a network where digital coins symbolize real assets (dollars, grams of gold, or oil barrels). In this case, the size of the money supply should vary depending on the number of assets under control (collateral) of the owners of the blockchain network. For example, Tether has 2.54 billion real US dollars in its cryptocurrency bank accounts, so the Tether digital dollar money stock (USDT) is limited to this amount.
Logo. In a binding offer you need to change the cryptocurrency icon - its graphic image. It should be simple, stylish and fit into the overall concept of your blockchain network you have invented.
Too small reward will not attract people, as it will be economically inexpedient to engage in mining. Too much will attract too many people, which will immediately increase the complexity of the network and, again, scare people away. Therefore, you need to choose the middle option, for example, as in Bitcoin or Ethereum.
Network ports. Through them, the blockchain network interacts with the Internet, so the choice should be approached with the utmost seriousness. Four ports are required — two for system operation and two more for testing. And on the resource of these ports should not encroach any other applications.
When changes are made to the fork network, it needs to be tested - run through all usage scenarios. You need to do this many times and preferably on different devices. Since any error or vulnerability of the network can cause a critical error or serve as an “entry” for intruders.
Both of these options are highly undesirable, as a non-working and unreliable network will scare users away or cause the ruin of your business. This is especially important in cases where the blockchain is created as a decentralized platform with irreversible transactions.
Now let's look at the process of launching the blockchain network at special sites that developers use to launch crypto startups. The most popular of them is Ethereum, so we will consider the launch of the network using its example.
The launch of smart contracts, the release of tokens and the deployment of new networks within Ethereum require gas - local “fuel”. Gas costs money, so beginners are advised to check the performance and functionality of their projects in the test network before spending real money on them.
Knowing this, you can start creating a personal blockchain network within Ethereum. To do this, we need a smart contract to launch new tokens. It can be written from scratch, but this is not our way. Easier and safer (if you're new) is to copy code of the desired smart contract from the official site.
After that, a new window will appear, where at the bottom of the screen you need to paste the previously copied token-contract code. Here you need to specify the name and symbol of the token, the maximum size of the money supply and how many parts of the token is divided (the number of decimal places).
When the contract code is inserted and the data is entered, you need to click "Deploy", and if there is enough gas in the wallet, the token-contract will start.
This is the easiest way to create a network based on Ethereum blockchain. Such a network will not stand out in any way and there will be no benefit from it either. To create something more useful, use the simple official guide of the platform to improve the standard token and give it unique properties.
Standard token is suitable only for the simplest cases of business tokenization or acquaintance with the world of blockchain and cryptocurrency. In other cases, it will simply not be noticed due to the presence of thousands of other similar coins.
If you do not want to understand all this and do everything yourself, you can hire a blockchain developer company. So you can save time and nerves, since the creation of the blockchain network will be handled by experienced professionals who know this inside out.
The development time and cost of services of such a company depends on the nature of the network being created. For example, if this is the tokenization of business through the initial offer of coins at the Ethereum site, it is somewhere around 100 thousand dollars and a couple of months. Creating a unique blockchain can take up to $5 million and a year to develop. The most simple projects cost 10-50 thousand dollars and deployed within a month.
The cost of services of development companies usually includes the following:
- compilation of the blockchain network core;
- development of wallets for different operating systems and device types;
- deploying multiple primary nodes (network nodes);
- creation of block explorer and mining pool.
If your blockchain network is not for internal use, it should be promoted to the masses. To do this, you need a separate budget and several specialists who will create a website, engage in advertising and informing the community. You can also run airdrop and bounty campaigns, this will reduce the budget and allow you to promote the network in several language zones.
It will not hurt to enlist the support of advisers - authoritative personalities in their field, who will help you as advisers. They can take control of certain aspects of development and/or advancement and will act as guarantors who vouch for their project with their reputation.
Access to the exchange
On the cryptocurrency exchanges, the market price of tokens is being formed, which in the plans of developers should grow as soon as their coins get into listings. Therefore, after the completion of the technical stages of development, testing and deployment of the blockchain network, coins are attempted to be included in the cryptocurrency exchange lists.
If your token does not have serious support and there is no hype around it, it’s not worth counting on the fact that it immediately falls into the lists of the main trading platforms. We need to start with new and small exchanges that want to stand out due to a larger list of tokens in the listings or the presence of exotic bitcoins. It should start exactly from such sites.
The listing procedure depends on the site. So, in Poloniex it is free, but tough: you need to register, go through verification and prove the benefit of the token to society. At other sites, the requirements may be relatively simple, but the procedure can cost money - from 1,000 dollars for little-known sites to 100,000 dollars for the largest cryptocurrency exchanges.
Creating a blockchain network unnecessarily is a waste of resources and time. Therefore, before starting, make sure that you really need a new blockchain. Then determine the budget and level of programming skills to understand which development method to choose:
- create fork of existing network - price and time depend on your quickness and number of changes;
- use a specialized platform - easy, fast, inexpensive;
- assemble a team of blockchain developers - long and expensive;
- outsourcing is fast and there is a guarantee of quality, but it costs a lot of money.
If you do everything right, the test network can be deployed in an hour. To make something unique and competitive, it will take several months. For the introduction of the blockchain in your own business, you need up to six months.
At the same time, you need to remember about the risk: your cryptocurrency cannot shoot and not pay off, losing among the 1,600 existing coins, so measure it seven times and then lay out the money. But if you do it for the sake of interest or gaining skills - go for it!