Build a step-by-step, decentralized application (Ethereum Blockchain Dapp) in more than 128 words – Part 1

This article aims to explain the key concepts of blockchain, dapp (decentralized app), smart contract and tokenization.

Blockchain

A blockchain is a decentralized database, it is shared between several nodes that has a copy of that database.

Block

A request for a user to add data to the database is a transaction. Transactions are grouped and added to a block in the blockchain.

Note that all data in this shared register, the blockchain, is secured by cryptographic hash and validated by an algorithm that is a consensus among network users.

Block concept in a blockchain

Minor

Minors are network users who use a program to validate new transactions and record them on the blockchain.

Example of a miner's farm equipped to calculate transactions on the blockchain (via complex mathematical and cryptographic problem solving), miners receive a "reward" for their work.

Blockchain Ethereum

Ethereum is an open source platform that uses blockchain technology to run decentralized applications (dapps).

This platform is based on the creation of Smart Contract, it is a program that contains data and functions called by applications.

Based on the blockchain there is no centralized database but a register shared and maintained in peer to peer by users.

This technology can be used to exchange currencies or to create decentralized applications that call smart contracts and store their data in blocks of the blockchain.

Public Blockchain

In a public blockchain there is no permission, everyone can join the blockchain network, which means they can read, write or participate with a public blockchain.

Public Blockchains are decentralized, no one has control over the network and they remain secure because the data cannot be changed once validated on the block chain.

Public blockchain platforms such as Bitcoin, Ethereum, Litecoin are un authorized blockchain platforms, striving to increase and protect the anonymity of the user.

Private Blockchain

In a private blockchain there are restrictions to filter who is allowed to participate in the network and what transactions.

Private blockchains tend to be associated with identity management tools or a modular architecture on which you can plug in your own identity management solution.

This may be an OAuth solution service provider that uses Facebook, LinkedIn, for example,…

Token Ethereum

Ethereum tokens or tokens are digital assets that are built from the Ethereum blockchain. These are tokens that attest that you have a value (economic for example). These tokens are based on Ethereum's existing infrastructure.

To store, receive, send ether (cryptocurrency on the blockchain ethereum) or tokens (which are tokens that are digital assets), you need at least one account. The easiest way to create an account is:

It is possible to create its own token to create its decentralized application that uses the public blockchain ethereum.

Tokenisation of financial assets

Tokenization is a method that converts the rights of an asset (financial, real estate …) into digital tokens (tokens).

Example for a 400,000 Euro apartment. Tokenizing it consists of turning it into 400,000 tokens (the number is arbitrary, the Issue can be 4 million or 100 chips).

Tokens are issued on a kind of platform that supports intelligent contracts, for example on Ethereum. The goal is for tokens to be freely exchanged.

When you buy a token, you actually buy a share of the ownership of the asset (from the apartment of 400,000 euros).

Buy 200,000 chips and you own half the assets. The Blockchain is shared register that is immutable, it ensures that once you buy tokens, no one can delete your property.

Decentralized application

Decentralized applications are applications that communicate with the blockchain. The decentralized application interface is similar to any website or mobile application.

The Smart Contract represents the central logic of decentralized application.

Illustration of a DApp that uses a blockchain with smart contracts combined with the looters of Swarm and Whisper.
Source: Ethereum Stack exchange

Smart Contract

Smart Contracts contain all the business logic of a DApp. They are responsible for reading and writing data in the blockchain, so they execute business logic.

Intelligent contacts are written in a programming language called SOLIDITY https://solidity.readthedocs.io, similar to Javascript.

To read on the subject: