Setting up Private Ethereum Network

What is Ethereum Private Network?

An Ethereum Private Network is an isolated distributed system where each node is running an ethereum client(geth). Private Networks are mainly hosted by enterprises to restrict entry permissions to the network. Only the nodes with the right permissions will be able to access this Blockchain. The nodes in this network are not connected to the Ethereum mainnet, so ethers have no value here.

Installing Ethereum on Ubuntu

To install Ethereum, run the following commands in a terminal:

$ sudo apt-get install software-properties-common
$ sudo add-apt-repository -y ppa:ethereum/ethereum
$ sudo apt-get update
$ sudo apt-get install ethereum

Now you have ethereum geth client in your system.

Create a new directory for private network

$ mkdir private-ethereum
$ cd private-ethereum

Now, create two EOA’s with the help of below command

geth --datadir ./datadir account new

Creating Genesis File

It’s basically the config file for your Ethereum network.

create a file named genesis.json

{
  "config": {
    "chainId": 15,
    "homesteadBlock": 0
  },
  "difficulty": "1",
  "gasLimit": "9999999",
  "alloc": {
    "0xd5874ff2e27b5aa6ce3943803b5799a41c1b4f67": {
      "balance": "30000"
    },
    "0x104dc7d158c99c9a98a297ff82600eac99db7d02": {
      "balance": "40000"
    }
  }
}

The genesis file is a JSON file that contains config parameters that create a good base network.

config: “config” block contains all the config parameters and thresholds that control the network's basic operations.

chainId: Unique Id of the network.

difficulty: This number decides how difficult the blocks will be to mine. For Private networks, it’s good to set a lower number as it lets you mine blocks quickly, which results in fast transactions.

gasLimit: This defines the limit of gas cost per block. Set this value high to avoid being limited when testing.

alloc: This part is used to allocate ethers to already created accounts.

Initialize the Node with genesis file

geth --datadir ./myDataDir init ./genesis.json

On successful instantiation, you should see the following output:

Start Node

With the Data Directory instantiated, we can now start the Blockchain. Now start the node, using the command below.

geth --datadir ./myDataDir --nodiscover --networkid 1114 console 2>> Eth.log

Done! Your private Ethereum Blockchain is up and running.

You can check the logs in a separate terminal

tail -f Eth.log

Importing accounts to Private Network

You need to copy the accounts keystore files from

path: ./datadir/keystore

path: ./myDataDir/keystore

Set up the second node

Now let’s set up a second node in the blockchain network. The process will be similar to setting up Node1.
Open a new terminal window and navigate to the project folder that contains the genesis.json file.
Initialize the new node with the following command:

geth --datadir ./yourDataDir init ./genesis.json

Note: Since we want this node to be part of the same blockchain, we use the same genesis block.

To get your node up and running with a Geth console, type in the following:

geth --datadir ./yourDataDir --nodiscover --networkid 1114 console 2>> Eth2.log

Your node is up and running.

admin.nodeInfo

Now we will connect both the nodes and form a blockchain network.

We will do this by adding one of the nodes to the other as a “peer”.

Run the following command on the Geth Consoles of both Node1 and Node2:

> admin.peers
> admin.nodeInfo

You can now add peers using the below command

admin.addPeer(“//enode id”)

All set, now you can use the console to use all sorts of geth commands like:

eth.accounts
admin.nodeInfo
personal.newAccount()
eth.accounts[0]
eth.getBalance(eth.accounts[0])
eth.coinbase
web3.fromWei(eth.getBalance(eth.accounts[0]),"ether")
personal.unlockAccount(eth.accounts[0], "<password>")
web3.fromWei(eth.getBalance("0xd5874ff2e27b5aa6ce3943803b5799a41c1b4f67"), "wei")
eth.sendTransaction({from:eth.accounts[0], to:eth.accounts[1], value: web3.toWei(1000, "ether")})
eth.sendTransaction({from:”0xd5874ff2e27b5aa6ce3943803b5799a41c1b4f67”, to:”0x104dc7d158c99c9a98a297ff82600eac99db7d02”, value: web3.toWei(20, "wei")})

remember you need to mine the transaction to see the state change.

miner.start()
miner.stop()

Transaction Pool

1. shows transaction pool

txpool.status